DRC Faces Fresh Legal Battle With AVZ Over Lithium Site
TLDR
- The Democratic Republic of Congo (DRC) is once again facing arbitration proceedings from Australian mining company AVZ Minerals, after talks broke down over the Manono lithium project
- AVZ had temporarily suspended its legal claim in May 2025 at the request of the U.S. government, but resumed the case on June 18
- The dispute centers on the revocation of AVZ’s permit in 2023 by Congo’s Ministry of Mines, which cited project delays
The Democratic Republic of Congo (DRC) is once again facing arbitration proceedings from Australian mining company AVZ Minerals, after talks broke down over the Manono lithium project. AVZ had temporarily suspended its legal claim in May 2025 at the request of the U.S. government, but resumed the case on June 18 before the International Centre for Settlement of Investment Disputes (ICSID).
The dispute centers on the revocation of AVZ’s permit in 2023 by Congo’s Ministry of Mines, which cited project delays. The rights were reassigned to a subsidiary of China’s Zijin Mining, triggering legal action by AVZ. The revived case could complicate a separate deal between AVZ and U.S.-backed KoBold Metals.
KoBold, supported by Breakthrough Energy Ventures, announced a framework agreement in May to acquire AVZ’s stake in the southern section of Manono. The deal, potentially worth over $1 billion, targets one of the world’s largest hard-rock lithium deposits, estimated at 842 million tonnes at 1.61% grade. KoBold plans to export lithium to Western markets using AI-powered mineral exploration. But AVZ’s return to arbitration may now stall implementation of the agreement.
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Key Takeaways
The renewed legal battle over the Manono lithium project adds complexity to global efforts to diversify battery mineral supply chains. The DRC hosts some of the world’s richest lithium and cobalt deposits, and the Manono site is seen as critical to the U.S. strategy for reducing dependence on China in the electric vehicle sector. KoBold Metals, which uses artificial intelligence to locate and assess critical mineral deposits, is part of a broader U.S. push to gain access to battery metals through strategic partnerships. The firm’s deal with AVZ was intended to unlock production while avoiding further legal and political risk. Under the original arrangement, AVZ was expected to pause legal action in exchange for compensation and cooperation with KoBold. With arbitration now back on, that scenario is uncertain. The revived claim could delay investment timelines and create diplomatic friction. For the DRC, the case also highlights the tensions between foreign investor rights, national control over strategic resources, and the competing interests of Chinese and Western stakeholders. With over $1 billion in potential capital at stake, the outcome of the arbitration could influence future deals in Africa’s growing lithium sector.
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