Nigeria is gearing up to commission four state-of-the-art lithium processing plants in 2025, with investments totaling over $800 million, predominantly funded by Chinese companies. This ambitious initiative, spearheaded by Nigeria’s Ministry of Solid Minerals, marks a significant step toward transforming the country into a hub for critical mineral processing and reducing its reliance on raw material exports. As global demand for lithium—so crucial for batteries in electric vehicles, renewable energy storage, and consumer electronics—continues to soar, Nigeria is positioning itself to capitalize on its vast mineral wealth while fostering job creation, technological advancement, and sustainable economic growth.
According to Nigeria’s Minister of Solid Minerals, Dele Alake, the flagship project is a $600 million lithium processing plant located near the Kaduna-Niger border, expected to be commissioned within the first quarter of 2025. This facility, one of the largest of its kind in Africa, is designed to process raw lithium ore into high-value concentrates, a critical component in the global battery supply chain. Meanwhile, a $200 million lithium refinery on the outskirts of Abuja is nearing completion, with operations set to commence soon after. Two additional plants are slated for development in Nasarawa State, with completion targeted before the third quarter of 2025, further solidifying Nigeria’s ambitions in the lithium sector.
The funding for these projects is predominantly from Chinese investors, with over 80% of the capital coming from companies such as Jiuling Lithium Mining Company and Canmax Technologies. These firms bring not only financial backing but also technical expertise in lithium processing, a field where China has established global dominance. The remaining stakes are held by local investor Three Crown Mines, ensuring Nigerian participation in this transformative venture. This partnership reflects Nigeria’s strategy to attract foreign investment while maintaining a foothold in its burgeoning mining sector.
Why Lithium?
Lithium, often dubbed “white gold,” is a cornerstone of the global transition to clean energy. Its applications in lithium-ion batteries for electric vehicles, solar energy storage, and portable electronics have driven exponential demand, with global prices surging in recent years. Nigeria’s entry into this market is timely, as a 2022 report by the Nigerian Geological Survey Agency revealed significant high-grade lithium deposits across states like Kaduna, Nasarawa, Kwara, Plateau, and Ogun. These deposits, primarily spodumene and lepidolite, are among the world’s richest, positioning Nigeria as a potential powerhouse in the global lithium supply chain.
The decision to prioritize local processing over raw mineral exports aligns with Nigeria’s 2023 Mineral Export Ban Policy, which seeks to maximize economic value from its natural resources. Historically, Nigeria has exported raw minerals like tin, columbite, and now lithium, only to import finished products at a premium. By establishing domestic processing plants, the government aims to retain more value within the country, create thousands of jobs, and foster the development of downstream industries such as battery manufacturing and renewable energy technologies.
Economic Diversification and Job Creation
The lithium processing initiative is a cornerstone of Nigeria’s broader strategy to diversify its economy, which has long been tethered to oil and gas. In 2023, the mining sector contributed just N6 billion to Nigeria’s GDP, a fraction of the oil-dominated economy. However, strategic reforms and investments led to a remarkable increase to N38 billion in 2024, signaling the sector’s growing potential. The new lithium plants are expected to further boost this figure, with projections estimating thousands of direct and indirect jobs, from skilled engineers and technicians to logistics and support staff.
Beyond job creation, the plants are poised to catalyze technological advancements. The facilities will incorporate cutting-edge processing technologies, potentially positioning Nigeria as a regional leader in mineral beneficiation. Local communities near the project sites, particularly in Kaduna, Niger, and Nasarawa, stand to benefit from infrastructure development, including improved roads, power supply, and training programs for workers. The involvement of local investor Three Crown Mines also ensures that a portion of the profits remains in Nigeria, fostering economic empowerment.
Challenges and Opportunities Ahead
While the prospects are bright, challenges remain. Infrastructure deficits, such as unreliable power supply and poor transportation networks, could hamper the efficiency of the new plants. Additionally, Nigeria’s mining sector has historically faced issues like illegal mining and regulatory bottlenecks, which the government must address to ensure the projects’ success. The reliance on foreign funding also raises questions about long-term economic sovereignty, though local participation through firms like Three Crown Mines mitigates this to some extent.
On the opportunity side, the lithium plants could serve as a catalyst for broader industrial development. For instance, processed lithium could feed into local manufacturing of batteries for off-grid solar systems, a critical need in a country where millions lack access to reliable electricity. The projects could also position Nigeria as a leader in Africa’s green energy transition, attracting further foreign direct investment and strengthening its geopolitical influence.
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