Column: Electric dreams turn into a nightmare for battery metals
A sector that was once racing to build new supply has been closing mines and deferring projects as low prices bite into the cost curve.
Leo Lithium has signed an agreement with China’s Ganfeng Lithium to sell its remaining 40% stake in a mine in Mali for $342.7 million, the Australian miner said on Wednesday.
The West Perth-based company also signed a memorandum of understanding to settle all outstanding issues with Mali for $60 million, including the government’s free carry stake in the Goulamina lithium project.
Leo Lithium decided to sell the stake after it tried to reach a “viable agreement” with the Mali government, it said, adding that the risks associated with operating in Mali and the impact of new mining code meant selling the stake was in the best interests of its shareholders.
The implementation of the new mining code in Mali means the government’s potential stake in the Goulamina project will likely rise to 30% from 20% previously, with a further 5% stake likely going to a local entity.
“The board believes the executed sale and purchase agreement with Ganfeng provides our shareholders with certain value under highly challenging circumstances,” the Australian miner said.
Leo Lithium reiterated that the project was on track to produce its first spodumene in the third quarter of 2024.
(By Rajasik Mukherjee; Editing by Rashmi Aich and Subhranshu Sahu)
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