Canada Sigma aims to put Brazil on the map

Image Source: ft.com

FT reported that Canadian mining company Sigma Lithium Resources is developing a mine in Brazil that it claims could put the country on the map as a high-grade lithium producer. Sigma is raising up to CAD 30 million (USD 23.8 million) through a Toronto Stock Exchange listing, as part of a plan to invest CAD 85 million for initial production of 240,000 tonnes a year by 2020.

Sigma said that it will look to raise further capital for a phase two expansion of similar size. This would place it in the ranks of producers such as Kidman Resources in the world’s largest lithium mining country, Australia.

Sigma said it had mining rights to an area covering 18,000 hectares and nine past-producing lithium mines in Minas Gerais in Brazil.

The initial Sigma operation had a resource estimate of 12.9m tonnes of ore with a 1.56 per cent lithium oxide average grade, which is considered high in the industry. The entire site could have resources of up to 70m tonnes.

Mr MacMurray Whale, an analyst at Cormark Securities in Canada said that “It is interesting, it’s going to take a fair number of people by surprise.” He said that “The industry hasn’t really thought about Brazil and what they may have.”

Sigma said its output could be used for electric vehicles in Brazil or could be sold for export. Almost all electric cars, such as the Nissan Leaf and Tesla Model S, use lithium-ion batteries because of their light weight and higher energy density.

Brazil is the world’s biggest producer of iron ore through Vale, the country’s largest mining company, but has up to now only been a very minor producer of lithium, which it mines from hard rock.

Source : Financial Times