Sigma Lithium said on Monday it has received an operating license from Brazilian regulators to sell and export lithium and that its production of the electric vehicle battery metal should begin within days.
The approval for Sigma to operate its Grota do Cirilo hard rock lithium mine and processing equipment was confirmed by the State Secretariat of Environment and Development (SEMAD), the environmental regulator for the Brazilian state of Minas Gerais.
The Vancouver-based company should be producing "within days" and shipping lithium "within weeks," Ana Cabral-Gardner, Sigma's CEO, told Reuters.
Sigma's US-listed shares closed on Monday up slightly following the news, after being down more than 4% earlier in the day.
Rumors have swirled in recent months that Tesla or Chinese lithium rival Ganfeng Lithium could make a bid for Sigma.
Cabral-Gardner declined to comment when asked if Sigma is in any takeover discussions.
"I'm focused on what I can control, which is getting this company to production," said Cabral-Gardner, who is also the managing partner of A10 Investimentos, which owns 45% of Sigma's shares.
Production is expected to slowly ramp up in coming months and hit an annual production rate of 270 000 t of spodumene concentrate by July.
In 2021, Sigma agreed to supply at least 60 000 tonnes to LG Energy Solution starting this year. The remaining production is expected to be sold on the spot market to customers that likely will process the metal in China, and Sigma is currently "ascertaining which client would get the first shipment," said Cabral-Gardner.
Because lithium demand is low in biofuel-focused Brazil, Cabral-Gardner said Sigma's project is "geared to enable the energy transition in the northern hemisphere."
Sigma has projected the mine will reach an annual free cash flow of $455-million for its first phase of production. Seven analysts recommend buying Sigma's stock and believe it should be trading 69% higher than current levels, according to Refinitiv Eikon data.