Highlights

• Africa's first integrated critical mineral refining facility announced with $100 million investment by ReElement Technologies and Novare Holdings
• Project aims to strengthen Africa's economic position by refining high-purity lithium carbonate and rare earth oxides using sustainable technology
• Initiative seeks to reduce global dependence on Chinese mineral processing
• Creates potential for regional industrial development

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ReElement Technologies (opens in a new tab) and Novare Holdings (opens in a new tab) have announced a $100 million partnership to build Africa’s first fully integrated critical mineral refining facility. This milestone project aims to strengthen Africa’s position in the global supply chain by adding value to locally sourced minerals rather than exporting raw materials. Utilizing ReElement’s proprietary chromatographic separation and purification technology, the facility will refine high-purity lithium carbonate, rare earth oxides, and other critical minerals—key components for the battery and defense industries in both Africa and North America.

This initiative is expected to accelerate industrial development in Africa by enabling nations to capture greater economic value from their natural resources. Unlike traditional refining methods, ReElement’s approach is more environmentally sustainable, reducing harmful emissions and waste byproducts. The project also aims to strengthen the supply chain for critical minerals, reducing global dependence on Chinese refining operations. By establishing a domestic processing hub, Africa could position itself as a key stakeholder in the rare earth and critical minerals market, an industry poised for exponential growth due to the increasing demand for electric vehicles, renewable energy storage, and defense applications.

Challenges and Risks

Despite the project’s potential, several key concerns remain unaddressed in the announcement. One major challenge is sourcing and supply chain risks. The press release does not specify where the raw materials will come from or whether existing mining operations will be integrated into the facility. Many African nations face regulatory instability, resource nationalism, and challenges related to artisanal mining practices, which could complicate the project’s long-term viability. Without clear partnerships with reliable mining operations, the supply chain may remain unpredictable.

Geopolitical and regulatory challenges also pose risks. Africa’s complex and varied regulatory environment makes obtaining the necessary permits, environmental approvals, and infrastructure support time-consuming. Additionally, political instability in certain regions could delay operations or deter foreign investors, making it difficult to maintain long-term sustainability.

While a $100 million investment is significant from an economic and financial standpoint, it may not be enough to scale up operations or compete with established global players. The project’s financial model and revenue projections remain unclear, and refining operations are traditionally capital-intensive. If costs overrun or demand shifts, the facility could struggle to maintain profitability.

One of the biggest competitive risks is China’s dominance in the rare earth refining sector. China controls the majority of the world’s rare earth processing capacity, benefiting from decades of expertise, infrastructure, and state support. However, it remains uncertain whether ReElement’s refining technology will be cost-competitive or capable of achieving the necessary output scale to attract large contracts from global manufacturers.

Finally, environmental and social considerations need further clarification. While the announcement emphasizes an environmentally friendly refining process, it lacks details on local environmental impact assessments, community engagement, and labor practices. Without clear ESG (Environmental, Social, and Governance) commitments, investor confidence and regulatory approval could be at risk.

Ola Leepile, CEO of Novare Group, said, “Novare is excited about this collaboration's potential for securing reliable and quality critical mineral supplies. It aligns seamlessly with our vision of being an impactful investor by establishing Sub-Saharan Africa’s first battery and critical minerals manufacturing facility. Through this partnership, we are confident that value addition and resource beneficiation can be achieved locally.”

REEx Takeaway

The partnership between ReElement Technologies and Novare Holdings marks at least another step toward Africa’s industrialization and self-sufficiency in the critical minerals sector. The initiative could reduce Western dependence on China by establishing a domestic refining capability and boosting Africa’s economic standing. However, success will depend on navigating geopolitical risks, securing stable raw material sources, and demonstrating the economic viability of its refining technology. As global demand for critical minerals intensifies, the project has the potential to reshape Africa’s role in the global supply chain—but only if these challenges are effectively addressed.