London-listed Bacanora Lithium is confident that it meets licence requirements to develop the Sonara lithium project, where production is set to start in 2023.
Responding to proposed energy legislation changes in Mexico, Bacanora said on Monday that it had started early construction activities at Sonora and that it had met all its licence requirements.
President Andres Manuel Lopez Obrador last week announced new energy reforms, including that future lithium extraction would be reserved for the State. Newswire Reuters reports that the President stated that eight existing concessions for extracting the metal would remain in private hands if companies could develop the industry.
Lopez Obrador said that private companies had to prove that they had done exploration work and that they had the capacity to invest and extract lithium.
Bacanora in February this year started initial site activities at Sonora, which would produce 35 000 t/y of battery-grade lithium carbonate when in full production.
Other energy changes pitched by Lopez Obrador foresee giving the Comision Federal de Electricidad (CFE) more than half of the power market and putting it in charge of setting terms for private generators. The bill will also do away with energy regulators, grouping their functions under the Energy Ministry and the CFE.
The bill is seen as a reversal of business-friendly energy legislation enacted by the previous administration. Lopez Obrador argues that the changes will keep prices low for consumers and end preferential treatment for private firms.
- with reporting by Reuters