The federal government has thrown its full support behind the construction of Africa’s largest rare earth and critical minerals processing facility, a landmark industrial project set to reshape Nigeria’s role in the global energy transition economy. 

The plant, located in Nasarawa State, is being developed through a public-private partnership and is expected to boost local value addition in the country’s growing lithium and critical minerals sector.

The facility, which will be operated by Avatar New Energy Materials Company Limited, has a projected refining capacity of 4,000 metric tonnes of lithium per day. When fully operational, it will rank as the continent’s biggest rare earth processing hub and Nigeria’s first of such scale in lithium value addition.

The plant was officially commissioned in May 2025, with President Bola Tinubu represented at the event by Senate President Godswill Akpabio. Tinubu lauded the project as a cornerstone of his administration’s Renewed Hope Agenda, aimed at industrializing Nigeria’s resource sectors, creating jobs, and moving away from dependence on crude oil exports.

“Nigeria must stop exporting raw materials and start exporting finished goods. This plant is a major step toward that future,” President Tinubu said in a prepared speech.

The processing plant is expected to significantly advance Nigeria’s participation in the global supply chain for electric vehicle batteries, renewable energy components, and high-tech electronics, all of which rely heavily on rare earth and critical minerals such as lithium.

Investors from China are playing a central role. Avatar New Energy is leading the project, while Canmax Technologies—another Chinese firm—has pledged an additional $200 million for a second lithium facility in the same state. Another company, Jiuling Lithium, has committed $250 million for a processing site in Udege, reinforcing Nasarawa’s emergence as Nigeria’s lithium capital.

Altogether, the various phases of the initiative are projected to generate over 4,000 direct and indirect jobs, particularly for youths and skilled workers in the region.

As part of its support, the Nigerian government has restructured its mining regulations to prioritize local processing. Under the new policy direction, miners must demonstrate clear plans for in-country beneficiation before being granted export licenses. This shift aligns with global efforts to enhance supply chain security and reduce overreliance on foreign mineral refining hubs.

Governor Abdullahi Sule of Nasarawa State emphasized that the state is committed to creating an enabling environment for long-term investments in the solid minerals sector.

“This is not just an economic project—it’s a development milestone for Nasarawa, for Northern Nigeria, and for the entire country,” the governor said at the launch.

While the government celebrates the plant’s potential, several environmental and civil society organizations have raised concerns. The Corporate Accountability and Public Participation Africa (CAPPA) has urged the government to ensure that the drive for industrialization does not come at the expense of community rights, environmental health, and transparency.

CAPPA’s Executive Director, Akinbode Oluwafemi, warned against the risk of environmental degradation and displacement of indigenous communities, calling for rigorous environmental impact assessments, fair compensation, and continuous stakeholder engagement.

“We cannot allow Nasarawa to become another case of wealth extraction without development,” Oluwafemi said in a statement.

With global demand for lithium and rare earths skyrocketing due to the clean energy transition, Nigeria’s move to establish a domestic processing capacity positions it as a serious contender in Africa’s mineral economy. However, stakeholders agree that success will depend on the government’s ability to maintain regulatory discipline, uphold environmental standards, and ensure that local communities benefit meaningfully from the mineral wealth beneath their soil.

The Nasarawa plant is expected to begin full operations before the end of 2025.