PERTH (miningweekly.com) – The Malian government has backed a joint venture (JV) transaction between ASX-listed Firefinch and lithium developer Jiangxi Ganfeng Lithium Co over the Goulamina lithium project.

The two companies earlier this year struck an agreement 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.

“The Goulamina transaction will materialise the development of the first producing spodumene concentrate operation in West Africa, and on the Malian territory. It will allow Mali to attract new investments focused on metals used for the manufacture of batteries and the field of renewable energies. In addition, as part of the transaction, there is a focus on the creation of local jobs, the establishment of local infrastructure and the rapid monitoring of community engagement plans to meet the needs of local communities, which also aligns with the Malian Mining Code in terms of local content,” Mali Minister of Mines, Energy and Water Lamine Seydou Traore said.

Firefinch MD Dr Michael Anderson on Thursday said that the support of the Malian government and local community were key to the success of the Goulamina project.

“Goulamina will be the next large scale global lithium hard rock project to enter production, and the first of its kind in West Africa, with production targeted for 2023.

“Together with our partner, Ganfeng, the world’s largest lithium chemicals producer, we are working to expand the scale and production capacity of Goulamina and look forward to updating shareholders on the revised definitive feasiblity study (DFS) in the coming weeks.”

A final condition precedent for the Goulamina transaction is the receipt of Chinese regulatory approvals, which will allow for the transfer of the Goulamina exploitation licence to the JV company, and would prompt Gangeng to provide the first $39-million cash investment for the project.

The updated DFS will enable a final investment decision (FID), Ganfeng’s second cash investment of $91-million, and subsequent debt funding of up to $64-million. A FID is expected in the December quarter.