PERTH (miningweekly.com) – ASX-listed Firefinch is hoping to finalise the demerger of its Goulamina lithium project, in Mali, early next year, MD Michael Anderson told delegates at Paydirt’s Africa Downunder conference.

Firefinch in February this year flagged the possible spin-off of its Goulamina project into a separately listed company, after a strategic review found that the project was materially undervalued in the Firefinch share price.

Subsequent to the demerger decision, Firefinch struck an agreement with lithium developer Jiangxi Ganfeng Lithium Co to form a joint venture (JV) over the Goulamina project, under which Ganfeng would make a $130-million cash investment in return for a 50% interest in the project vehicle, and would also secure up to $64-million in debt funding that would bring the Goulamina project into production.

Anderson on Thursday said that the JV partners were now completing a definitive feasibility study on the project, building on Ganfeng’s technical knowledge.

“We hope to be in a position to make a final investment decision before the end of this year, before we bring the JV company to market. And I think that will present a significant value proposition in the lithium space,” said Anderson.

A 2020 definitive feasibility study into the Goulamina project estimated that it would require a capital investment of $194-milion, and based on a mineral resource of 108.5-million tonnes, grading 1.45% lithium oxide, the project would produce an average of 436 000 t/y of spodumene concentrate over a mine life of 23 years.

The study estimated a pre-tax net present value of some $1.2-billion, and a pre-tax internal rate of return of 55.8%, based on a price of $666/t of concentrate, while the all-in sustaining costs for the project have been estimated at $306/t of concentrate over years one to five of the operation.