Managing director Chris Evans:
“We are fully permitted in Mali, we have our mining permit, we have our environmental permit and our water extraction permit which means that, technically, with the right partners on board, we can start on the ground tomorrow with the development of our mine.”
Mali Lithium Ltd (ASX:MLL) expects to publish a definitive feasibility study (DFS) for its Goulamina Lithium Project in Mali, West Africa, in May and has a number of potential partners in the works to support project development.
Goulamina’s reserve of 31 million tonnes at 1.56% lithium oxide makes the project the world’s largest uncommitted hard rock lithium ore reserve.
Mali managing director Chris Evans said that the new board, which was formed in 2019, had the knowledge and experience to set the wheels in motion for cost-effective mine operations.
He told Proactive: “We’ve now got expertise, both at the board level and the management level, with lithium, mining development and finance experience.”
In the last 12 months, the management team has made several enhancements within the DFS.
Evans said: “We’ve improved recovery from 70% lithium in 2018 to now 89%.
“We have also modified the proposed processing flowsheet to achieve better outcomes.
“This is mainly due to the experience of the management team in lithium mines.”
Expanding the mineral resource
MLL has started a scoping study investigating potential downstream processing of lithium oxide from Goulamina and a drill program is underway to increase confidence in and extend the existing mineral resource.
Goulamina drill plan.
Evans said: “We’ll have an updated resource at the end of March and should have the updated reserve around the same time as the DFS.
“Hatch has completed the technical components of the scoping study which needs to investigate adding value to our product by further downstream processing in Mali.
“They’ve completed the technical aspects but now we’re adding all the costings which are closely tied to the DFS - so they will be issued around the same time.”
Coordinating with Kodal
MLL also recognises the practicality of coordinating with a similar lithium project nearby which could reduce operating costs.
Evans said: “Too many times you see two companies blindly build mines alongside each other with no cooperation because they’re too focused on their own things.
This may include the establishment of common facilities to provide construction, maintenance and operational services to both projects which will include vehicle workshops, spares storage, mobile plant hire, construction materials supply and laboratories.
Evans said: “Only the mines with the lowest operating costs will survive.
“Anything we can do with Kodal to ultimately lower our operating costs will be of benefit.”
Fully permitted for development
The company estimates that, with the right funding, offtake and development partners, the project could be constructed in 18-months.
Evans said: “It’s a bit different to your average mining project or mining investment where you don’t see anything out of the ground for years because permitting takes years and studies take years.
“We are fully permitted in Mali, we have our mining permit, we have our environmental permit and our water extraction permit which means that, technically, with the right partners on board, we can start on the ground tomorrow with the development of our mine.
“We are about to publish the DFS and we’re fully permitted which makes it a very near-term investment.”
Completed 3D model of the Goulamina Lithium Plant.
China Minmetals and CHICO
The company is committed to expanding on and developing relationships with Chinese partners.
In December 2018, MLL signed a letter of intent with China Minmetals Rare Earth Co Ltd (SHE:000831), a state-owned entity, and has since sent ore for testing.
Evans said: “They have expressed interest in the company in terms of being the EPC contractor but potentially also helping with financing and offtake for our product.
More recently, Mali entered an MoU with Chinese state-owned construction and engineering company China Henan International Cooperation Group Co (CHICO), for an early contractor involvement agreement.
Evans said the agreement was of enormous benefit to the project and offered the potential to accelerate engagement with other Chinese parties.
He said: “[CHICHO] operates exclusively in Africa building infrastructure, mines and operating mines.
“Alongside the DFS we are doing, CHICO is doing their own work to provide us with a capital cost and operating cost for them to build and operate the mine.”
The estimates are expected by the end of January 2020.
Strong position for Chinese investment
With the current agreements in place, Mali is confident China will be a likely source of investment for the Goulamina project.
Evans said: “China supplies 50% of the world’s lithium and recognises the need for more, so it’s quite likely an investment either through offtake or financing will come from there.
“If a Chinese state-owned entity is potentially going to build our mine and operate it for us, potential investors will be more confident in our project and our position will be much stronger when looking at Chinese investment.”