Mining Exacerbating Namibian Water Crisis

Hunterbrook Media’s investment affiliate, Hunterbrook Capital, did not take any positions related to this article. Based on past reporting, it has positions in the lithium industry: long Sociedad Química y Minera de Chile (NYSE: $SQM), long Albemarle (NYSE: $ALB), and short Arcadium (NYSE: $ALTM).

WINDHOEK  –  Lithium and tin mining in Uis, near Namibia’s highest mountain, Brandberg, is depleting crucial underground water access.

“They have suspended the afternoon studies in order for us to go fetch water,” Rosia Indongo, a student at Petrus Ganeb Secondary School in Uis, said in an interview with Tracy Tafirenyika, a local journalist who shared her reporting with Hunterbrook Media. Children have to bathe outside and use the bushes as toilets because there is no water in their lavatories, Indongo said. 

Postrick Mushendami, deputy director at the Bank of Namibia, confirmed in an interview with Hunterbrook Media that the Uis mines face water challenges.

“Presently those mines are dependent on borehole water for production, which is not sustainable,” he said. Mushendami said the mines have plans to connect to a pipeline built by Namwater, a national water utility company, coinciding with the construction of a desalination plant.

According to a local news outlet, The Namibian, plans for a government-owned desalination plant, which could help reduce the water shortage, have been under consideration since 1998, but have yet to materialize.

Businesses and residents in the region blame local mining endeavors by Andrada Mining Ltd. (LSE-AIM: $ATM) and Xinfeng Investments (Pty) Ltd., a subsidiary of Tangshan Xinfeng Thermoelectricity Co., Ltd,. for depleting the water supply and threatening local economic activity and daily life. Neither company returned Hunterbrook Media’s requests for comment. 

Ambitious production targets and a 2023 government directive banning the export of raw lithium and other critical minerals, in order to support local refining and processing endeavors, have led to the overuse of already depleted groundwater reserves. According to The Namibian, this has forced schools to close for several days and a local business to cut production. 

Andrada’s active Uis tin mine was recently approved to increase its maximum water threshold from 75,000 cubic meters of water a year to 150,000, according to a technical mining report. And last November, Andrada commissioned its pilot facility designed to capture lithium byproduct from the tin mine. 

Andrada plans to expand this lithium facility with a long-term target of producing 50,000 metric tons of lithium carbonate per year or 10 million metric tons of unprocessed ore per year, despite acknowledging the challenges of operating in an area with water scarcity issues. According to industry publication Mining Weekly, Andrada Chief Executive Officer Anthony Viljoen described the new plant as key to Andrada’s lithium strategy as it aims to become a leading global supplier.

The company, which owns three other projects within 40 km of Uis, previously promised to find additional water resources to supply its new projects, but that plan has not been finalized or made public yet.

Despite the area’s water challenges, according to the Windhoek Observer, Xinfeng has plans to start operating a lithium processing plant this year. The plant could use as much as 8,000 cubic meters of water per day.

The water shortage is even impacting local companies. In April, NamClay, Namibia’s largest clay brick manufacturer, warned that it will have to cut down production if the water shortage persists. As of July, Albert Weitz Jr., managing member of Namclay, was still worried about how the mines will impact the company’s production. 

“The main mine is Andrada Mining … they are the biggest consumer of water in the area,” Weitz Jr. told Hunterbrook Media. Weitz Jr. said the groundwater levels have been depleted severely over the last several months and he worries that Xinfeng’s operation could exacerbate the problem. “If they use more water, less will be available for the rest. So, it’s the same problem. They need to come with a solution as to how to get more water to the area,” he added. 

Chief Zacharias Seibeb of the Dâure Daman Traditional Authority told the Namibian Sun that community members were unhappy with lithium miners, citing a lack of transparency in issuing prospecting and mining licenses. Seibeb said more than 88 exclusive prospecting licenses were approved without consulting the Traditional Authority, violating the Minerals Act.

Xinfeng has confronted significant legal and operational challenges in Namibia. Last November, the Ministry of Agriculture, Water, and Land Reform stopped Xinfeng “from drilling boreholes and sourcing water” from state-owned farms after the company drilled three boreholes without approval. The company’s laborers work and live in poor and unsafe conditions near the mines, as discovered during an investigation by the Mineworkers Union of Namibia. Also, as The Namibian reported, Xinfeng has been accused of corruption and violating other national laws. Despite a court ruling that found evidence Xinfeng may be guilty of fraud, the Namibian government has been unable to revoke the company’s mining license without judicial approval.