West Africa-focused Kodal Minerals (LSE:KOD) is advancing the development of the Bougouni Lithium Project “firmly on schedule” with the delivery of DMS units and equipment at the Port of Abidjan expected this week.
Commenting on the company’s results for the year ending 31 March 2024, CEO Bernard Aylward says the past 12 months have been “truly transformational for Kodal” as Bougouni has advanced in Mali and transitions from developer to producer.
Stage one first production is “firmly on track for Q4 2024, which would make Bougouni the first London-listed lithium producer”, Aylward says.
The CEO of the mineral exploration and development company, which is focused on lithium and gold assets in West Africa, notes this will be no small achievement and is testament to its strong capital discipline maintaining capex within the US$65m estimate from the 2020 Feasibility Study.
“We are excited about the role Kodal lithium will play in the global EV revolution, providing feedstock to Hainan’s lithium hydroxide plant in China, which, in turn, is supplying Asian markets including Japanese and Korean car battery makers,” he says.
Kodal has now finalised the US$117.75 million funding package to develop the Bougouni Lithium Project stage one with operating partner Hainan Mining Co, a subsidiary of Fosun International.
The company has also completed the transfer of the project to Kodal Mining UK (KMUK), which is 51% owned by Hainan in return for US$100 million investment, with Kodal retaining a 49% stake.
Additional US$17.75m investment into Kodal Minerals plc by Hainan will fund the exploration of new investment opportunities.
Over the reporting period, Kodal increased Bougouni’s JORC compliant Mineral Resource Estimate (MRE) by 40% to 31.9 million tonnes at 1.06% Li2O, following reverse circulation drilling completed in the first half of 2023.
Global lithium demand is projected to rise by 17% a year between 2023 to 2026, driven by the rising adoption of EVs. However, weak Chinese demand and shifting policies in the US and European Union could see EV sales growth continue to remain slow.
According to the Department of Industry, Science and Resources’ (DISR) latest issue of its Resources and Energy Quarterly: June 2024, a rise in global lithium supply will see the lithium market remain in surplus. Chinese lithium lepidolite production have seen only modest declines despite falls in prices, and there are sizeable project pipelines in Australia and among emerging producers such as Argentina and Zimbabwe.
Write to Adam Orlando at Mining.com.au
Images: Kodal
