(Recasts, adds details in paragraphs 2,5, adds AVZ comment in paragraph 9)
China's Zijin Mining 601899.SS has vowed to defend its stake in the contested Manono Lithium mine in the Democratic Republic of Congo (DRC), one of world's largest hard rock deposits of the mineral, after it was granted development rights.
China's top gold and copper miner, Zijin has been snapping up lithium assets in recent years, including domestic mines and sites in Argentina, to produce the metal used in electric vehicle batteries.
Manono Lithium SAS, a joint venture by Zijin subsidiary Jinxiang Lithium and DRC'S state-owned Cominiere, has obtained an exploration licence for the northeast tenement of the Manono mine, the company told the Hong Kong Stock Exchange on Tuesday.
The company did not specify when the project will start exploration.
The permit had initially been held by Australian-listed AVZ Minerals (AVZ) , but it was revoked by the DRC's mining minister who said the company had not developed it fast enough. AVZ is contesting that decision.
Still, Zijin is committed to developing the project with Cominiere, the DRC, local stakeholders and the DRC people, Chen Chen, legal counsel for Zijin Mining, told Reuters on Wednesday.
"We cannot speculate as to what legal issues will arise in the future, but will defend the new JV so that work on the northern tenement may continue for the benefit of the DRC and its local communities," she said.
AVZ, which was worth A$2.8 billion ($1.79 billion) when it delisted from the Australian stock exchange last year, maintained it was the legal owner of the tenement.
"AVZ has been in constructive negotiations with the DRC Government to establish a pathway to grant the mining licence and the resolution of arbitrations between AVZ and DRC controlled entities," it said in a statement to Reuters on Wednesday.
Chinese resources firms and battery manufacturers are investing across Africa to expand output for metals like copper, cobalt and lithium that are key to the green transition.
"If exploration and feasibility studies go well, this has strong potential to become the first to-production lithium project for Zijin in Africa and the DRC," Jian Heyuan, general manager of Manono Lithium said in a statement to Reuters on Wednesday.
"Zijin intends to complete the construction of the Project within two years, after conducting the feasibility study and confirming financing," he said.
($1 = 1.5667 Australian dollars)
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