Lithium exploration: Abuja-based Chinese companies in Court over ‘N10 billion contract breach, fake license’ 

Two Abuja-based Chinese companies, Lideal Mines Limited and Wangwang Mining (China) Co. Ltd, along with the latter’s shareholders, Wang Youfeng, Zeng Yusang, Yu Binbin, and Zeng Guodong, are before the Federal High Court in Abuja over an alleged contract breach and a fake lithium exploration and mining license.

Lideal Mines Limited’s lawyer, Abraham Abisoye, filed the case under suit number, FHC/ABJ/CS/1342/2023.

He is seeking N10 billion in general damages for breach of contract, due to alleged false representations by the defendants regarding their possession of an Exploration License and Mining License.

Applicant’s Claims 

According to the lawyer, the defendants informed his client that, although they had obtained all necessary licenses, they required machinery to execute mining activities in an additional approved area covering “approximately 32.3 square kilometers.”

He stated that the defendants allegedly solicited financial assistance from the plaintiff to finance the mining project, which ranged between RMB 30 million to RMB 40 million, and that the disbursed money was designated as investment costs.

“The investment cost loan facility was mutually agreed to span an 8-month period of mining operations. 

“Surprisingly, two months into the mining operation, the plaintiff was informed that the purported EXPLORATION LICENSE, issued by the Nigerian Mining Cadastral Office in Abuja, was false, and the Mining License for the 11 square kilometers claimed to be premised on the Exploration License was also false,” he submitted.

The lawyer added that the representatives of the plaintiff approached the defendants to produce the mining license for which the plaintiff had already invested significantly by purchasing equipment for the operation; however, they allegedly “have refused, failed, or neglected to keep their promises in line with Articles 9.1 and 9.2 of the Agreement.”

A representative of the plaintiff, Cheng Tao Hong, told the court that following the Exploration License and the representations made by the defendants, her company had entered into an equity sharing agreement for lithium materials from the mining site by purchasing a 30% share capital in Wangwang.

The plaintiff seeks a N10 billion award in general damages among other reliefs.

What Transpired in Court 

  • At the resumed sitting on Monday, Abisoye, for the plaintiff, informed Justice Inyang Ekwo that the defendants’ counsel had approached his client for settlement but later withdrew from the settlement discussions.
  • He also complained about several changes of counsel by the defendants even before the trial had commenced.
  • S.N. Agbu announced his appearance for Wangwang and another party but said nothing during the proceedings.
  • Abisoye informed the judge that the defendant’s counsel was another new lawyer in the matter.
  • Abisoye stated he had two witnesses to support his case.
  • The judge responded that while he is “not foreclosing parties from settlement,” he fixed February 18, 19, and 20, 2025, for the hearing.
  • The Federal High Court has jurisdiction to preside over mining and exploration disputes.