PERTH (miningweekly.com) – ASX-listed Firefinch has announced plans to bring forward production at the Goulamina lithium project, in Mali, having signed a suite of full form legal agreements to progress its joint venture (JV) with lithium developer Jiangxi Ganfeng Lithium Co.

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.

Firefinch on Monday said that the JV would be called Leo Lithium, and would be listed on the ASX.

“Another significant milestone has been achieved in progressing Goulamina toward construction and production. Formal documentation has been completed, and satisfaction of the remaining conditions precedent to completing the $194-million Ganfeng deal is well underway,” said Firefinch MD Dr Michael Anderson.

“In consultation with our partner Ganfeng, we have also agreed to bring forward final investment decision (FID) to the end of this year. Off the back of a positive FID, we will be in a very strong position to demerge Goulamina into a dynamic new ASX-listed lithium player, Leo Lithium, and list in early 2022.

“All Firefinch shareholders will receive a pro-rata entitlement to Leo Lithium shares, together with the opportunity to increase their interest, should they wish, under a planned entitlement offer. On completion of the entitlement offer and listing, Leo Lithium is expected to have a fully funded interest in a global scale lithium development with pre-production engineering underway and imminent commencement of construction,” 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 pretax 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.

First production at Goulamina will be accelerated, and is now expected in 2023.

“Firefinch will be aligned with its shareholders as it intends to retain up to 20% of Leo Lithium and will support Leo Lithium in building operational capability and a world class management team,” said Anderson.