DRC • Kinshasa gains ground in lithium arbitration against

The Democratic Republic of Congo has secured a significant tactical victory in its ongoing international arbitration against AVZ Minerals over the Manono lithium project, one of Africa's most contested mineral development disputes. As the DRC government intensifies efforts to reassert control over strategic battery metal assets, this arbitration development carries profound implications for mining governance, investor confidence, and the global lithium supply chain that powers electric vehicles and renewable energy storage.

## What is the Manono Lithium Project Dispute?

The Manono project in Katanga Province is one of the world's largest undeveloped lithium deposits, containing an estimated 27 million tonnes of lithium carbonate equivalent (LCE). Australian-listed AVZ Minerals holds the exploration license through its subsidiary, but the DRC government has challenged the company's rights to develop the asset, citing governance failures and alleged non-compliance with Congolese mining code requirements. The dispute escalated in 2021 when the DRC government reassigned the license, triggering international arbitration proceedings under ICSID (International Centre for Settlement of Investment Disputes) frameworks.

Kinshasa's legal gains in this arbitration reflect broader tensions over resource sovereignty in Africa's mining sector. The DRC, responsible for 70% of global cobalt production and a rising share of lithium supply, has been reasserting state control over strategic minerals essential to the global energy transition. This positions the Manono case as a test of whether African governments can successfully renegotiate or invalidate mining contracts without triggering massive arbitration payouts.

## How Does This Affect Lithium Supply and EV Markets?

Lithium prices have remained volatile since 2022, with battery manufacturers and automakers desperate to secure long-term supply agreements. The Manono project could produce 30,000 tonnes of lithium carbonate annually at full capacity, representing approximately 10% of current global demand. Any resolution favoring the DRC government could delay production by years, tightening supply further and potentially raising battery costs for African EV manufacturers and global OEMs.

For investors, the arbitration signals heightened regulatory risk in DRC mining ventures. AVZ shareholders have already absorbed significant losses on the stock price; the company's market capitalization fell from peaks above AUD $1 billion in 2021 to lower levels as the dispute dragged on. However, a DRC victory may embolden other African nations to renegotiate mining agreements unilaterally, reshaping project economics across the continent.

## Why Kinshasa's Position Matters for African Mining Sovereignty

The DRC's advancement in this case reflects President Félix Tshisekedi's mineral nationalism agenda—a strategy to capture greater value from Congo's vast resource wealth. Unlike previous administrations, this government has demonstrated willingness to weaponize regulatory enforcement, contract renegotiation, and arbitration defense against foreign miners perceived as extracting disproportionate value.

If the DRC prevails or negotiates a favorable settlement, it could establish precedent for African governments to reassert sovereignty over strategic mineral assets. Conversely, if AVZ wins, it reaffirms arbitration's role as an investor shield, potentially deterring future government action.

Market participants should monitor the arbitration timeline closely. A ruling is expected within 12–24 months. The outcome will influence lithium sourcing strategies, battery supply chain investments in Africa, and the cost structure of EV production globally.

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