After Zijin Mining Acquired a Controlling Stake for Over 13.7 Billion, Zangge Mining's 4.5 Billion Lithium Carbonate Project Was Approved

On the morning of June 24, Zangge Mining (000408) announced that its wholly-owned subsidiary, Zangge Mining Investment (Chengdu) Co., Ltd., through its controlled Tibet Ali Mamicuo Mining Development Co., Ltd., which is held by Jiangsu Zangqing New Energy Industry Development Fund Partnership (Limited Partnership), had received approval from the Tibet National Development and Reform Commission (NDRC) for the lithium-boron ore mining project at the Mamicuo Salt Lake in Gerze County, Ali Prefecture.

The announcement revealed that the Mamicuo Salt Lake is located in Gerze County, Ali Prefecture, Tibet. The estimated total investment for the project is 4.537 billion yuan, all of which is enterprise investment. The product plan includes an annual output of 50,000 mt of battery-grade lithium carbonate, along with the recovery of boron elements and the co-production of 17,000 mt of borax. The mine's production service period is 33 years (excluding a 2-year construction period).

The project extracts lithium resources from the Mamicuo Salt Lake brine as raw material. The brine is directly transported to the processing plant through pipelines. The lithium extraction process adopts the technical route of "continuous adsorption method + membrane-based impurity removal and concentration + one-step lithium precipitation." The main construction contents include a brine intake pumping station, brine transportation pipelines, brine return pipelines, pre-treatment adsorption units, nanofiltration and reverse osmosis units, bipolar membrane electrodialysis units, lithium precipitation MVR units, a finished battery-grade lithium carbonate warehouse, and supporting public auxiliary facilities.

Recently, during a survey reception by institutions, Zangge Mining also mentioned that it has currently cultivated over 100 technical personnel for the Mamicuo project, whose technical literacy and business capabilities have met the requirements of their corresponding positions. After the Mamicuo project is launched, the reserved technical personnel can quickly take up their positions, seamlessly meeting the project's technical needs and providing solid technical support for the smooth progress of the project.

According to information, since its establishment in 2002, Zangge Mining has been based on the Qinghai-Tibet Plateau, relying on the resources of the 724-square-kilometer Qarhan salt lake, focusing on the development and utilization of national strategic mineral resources—potash and lithium chemicals. The company's main businesses are the production and sales of potassium chloride and lithium carbonate, with products widely applied in various industries such as agriculture, NEVs, ESS, and consumer electronics. In addition, the company holds a 30.78% stake in Julong Copper through equity participation, with Julong Copper's main product being copper ore.

It is worth mentioning that just this May, through a series of capital operations, Zijin Mining (601899) finally succeeded in bringing Zangge Mining under its umbrella.

On May 6, Zijin Mining announced that its wholly-owned subsidiary, Zijin International Holdings Co., Ltd. (hereinafter referred to as "Zijin International Holdings"), had completed the transfer procedures for the acquisition of 392 million shares of Zangge Mining, thereby obtaining a 24.98% stake in Zangge Mining for 13.729 billion yuan. After adding the shares held by concert parties, Zijin Mining controls a total of 411 million shares of Zangge Mining, accounting for 26.18% of its total share capital, and thus gaining control over Zangge Mining.

Zijin Mining is a large multinational mining group engaged in the exploration, development, engineering design, and technological application research of metal mineral resources such as copper, gold, zinc, lithium, silver, and molybdenum on a global scale. The company has significant mining investment projects in 17 provinces (autonomous regions) in China and 17 countries overseas, including the Julong Copper Mine and Junuo Copper Mine in Tibet, the Duobaoshan-Tongshan Copper Mine in Heilongjiang, the Zijinshan Copper-Gold Mine in Fujian, Zijin in Shanxi, Zijin in Guizhou, and Zijin in Longnan within China, as well as the Čukaru Peki Copper-Gold Mine and Bor Copper Mine in Serbia, the Kamoa-Kakula Copper Mine and Kolwezi Copper Mine in the DRC, the Rosebel Gold Mine in Suriname, and the Buriticá Gold Mine in Colombia overseas. The company is accelerating its entry into the new energy and new materials industries, owning the 3Q Salt Lake Lithium Mine in Argentina, the Lakkor Tso Salt Lake Lithium Mine in Tibet, and the Xiangyuan Hard Rock Lithium Polymetallic Mine in Daoxian County, Hunan Province. It has also been invited to lead the development of the northeastern project of the Manono Lithium Mine in the DRC. As of the end of 2024, based on a 100% stake in controlled enterprises and the equity interest in associated and jointly controlled enterprises, the company's total proven, controlled, and inferred resources were 110.37 million mt of copper, 3,973 mt of gold, 12.98 million mt of zinc (lead), 31,836 mt of silver, and 17.88 million mt of lithium (LCE).

Zijin Mining believes that this acquisition is conducive to integrating high-quality resources among publicly listed firms, adding a new high-quality mining-related publicly listed firm under its umbrella, and further reducing the company's asset-liability ratio. It will significantly enhance the company's reserves of its main metal varieties, copper and lithium, and add strategic mineral potassium reserves that are crucial for national food security, propelling the company to become a significant potassium salt producer. It will also enable the company to achieve absolute control over the Julong Copper Mine, improving its operational and management efficiency. Moreover, it will facilitate efficient collaboration between the two parties in salt lake projects in the Tibet region, promoting the development of the company's "two lakes and two mines" lithium projects by leveraging Zangge Mining's salt lake development experience and low-cost lithium extraction technology.

On the same day, Zangge Mining announced that its controlling shareholder had changed from Zangge Venture Capital to Zijin International Holdings, and its actual controller had changed from Xiao Yongming to the Finance Bureau of Shanghang County, Longyan City, Fujian Province.

In terms of performance, according to Zangge Mining's Q1 2025 report, in the first quarter, the company achieved a lithium carbonate production of 2,165 mt, down 9.24% YoY, and lithium carbonate sales of 1,530 mt, down 61.46% YoY. During the same quarter, the associated company Julong Copper produced 46,400 mt of copper, up 9.94% YoY, and sold 46,400 mt of copper, up 16.95% YoY. The company earned an investment income of 610 million yuan.