U.S. commits funds to Zambian initiative aimed at reducing China's dominance over crucial mineral resources
The United States Trade and Development Agency (USTDA) has announced a $1.4 million grant to Metalex Africa, a subsidiary of US-based Metalex Commodities, to fund a feasibility study for expanding a copper and cobalt facility in Northwestern Province, Zambia.
The grant is not intended to directly fund the construction of the facility, but rather to prepare the project for potential financing from various sources, including the private sector. The feasibility study will evaluate the potential for producing up to 25,000 additional metric tonnes of copper and cobalt concentrates annually at the Kazozu mine in Zambia's North-Western province.
The expanded copper facility's production is intended to reduce reliance on Chinese sources for these critical minerals. Currently, Chinese companies hold a near-monopoly on the production and processing of cobalt used in electric vehicle batteries, military equipment, and electronics.
The USTDA grant is not the only source of potential financing for the expansion. The feasibility study aims to unlock financing from various sources, including the private sector, to construct the existing copper and cobalt facility in Northwestern Province, Zambia.
It is worth noting that the financing responsibility for the construction of the existing facility lies with other investors or stakeholders, as USTDA covers only the study expenses. The expanded copper facility's concentrates will be shipped to the US and its allies.
The assistance from USTDA is designed to prepare projects for financing from other institutions, including the private sector. The feasibility study signed on Thursday will not fund the extraction and processing activities at the mine, but it will provide a comprehensive analysis of the project's economic, technical, and environmental feasibility.
The expansion of the Zambian copper facility is expected to attract financing from various sources, including the private sector, and secure a direct source of copper for American industries. This move aligns with the USTDA's mission to promote economic growth and development in partner countries by creating shared opportunities and strengthening the competitiveness of U.S. businesses.
In a separate development, it has been reported that a Chinese copper manufacturer is benefiting from Trump's tariffs, highlighting the need for alternative sources of these critical minerals. The USTDA grant and Metalex Africa's expansion plans are steps towards achieving this goal.
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