Canada’s Sigma Lithium (TSX-V, NASDAQ: SGML) said on Wednesday its flagship Grota do Cirilo project in the Brazilian state of Minas Gerais contains more resources that previously thought, which will allow the miner to further boost production levels in the future.
Sigma has raised the mineral resource estimates at the lithium project by 27%, which makes it the world’s fourth-largest operating industrial pre-chemical lithium complex, with 109 million tonnes in resources, the company said.
The announcement comes at a time of plunging lithium prices and other market changes that are affecting big and small producers alike.
Prices for the ultralight metal, essential for electric-vehicle (EV) batteries, have plunged more than 80% from its peak in early 2023. The market has been rocked by shifting expectations, from fears of scarcity to warnings of persistent excess supply over the next two to three years.
Sigma Lithium began a strategic review of its business last year, which has extended into 2024.
The Vancouver-based miner said in December it had received expressions of interest to acquire the company, its subsidiary Sigma Brazil and the Grota do Cirilo project.
“We are delighted with the overwhelming interest in our business from some of the most admired companies in the battery materials and electric vehicles industries globally, including automakers and battery manufacturers,” CEO Ana Cabral said at the time.
Sigma Lithium believes the increased mineral resources can be seamlessly incorporated into its current open pit mineral reserves, validated by the pre-feasibility study.
It means the company could eventually expand its Brazilian project capacity to a planned 104,200 tonnes of lithium carbonate equivalent. Current annual output capacity is 36,700 tonnes.
Sigma said its focus this year is on a drill campaign to build on the “J-shaped” lithium corridor connecting the existing resources of Grota do Cirilo.
Shares in the miner were up 2.4% in pre-market trading in New York following the update, but by midday they were down nearly 7%, leaving it with a market capitalization of ($2.2bn).
