Australian miner Leo Lithium Ltd. said Mali has suspended operations of unrefined lithium ore from its Goulamina project, a joint venture with China’s Ganfeng Lithium Group Co.
Crushing of direct shipping ore — an unprocessed form of material — has been immediately stopped while discussions with Mali’s Ministry of Mines are pending, according to a filing to Australia’s stock exchange. Leo Lithium plummeted more than 50% on Monday, its first day of trading since halting mid-July.
The Australian miner said the suspension won’t delay “any aspect of the project” and the first spodumene concentrate production remains on schedule for the second quarter of 2024. “Mining continues as per the pre-existing plan and mined ore is being stockpiled,” it said.
Goulamina is set to become the first producing lithium project in Mali, which is home to some of the largest gold mines in Africa run by companies including Barrick Gold Corp. and B2Gold Corp. The asset is one of the largest resources of lithium-bearing spodumene under development at a time when demand for the battery metal is surging.
Leo Lithium said in Monday’s statement it had received correspondence from the Malian mines ministry on July 17 about direct shipping ore, the status of the government’s 10% stake and overall status of project progress. Mali has also formed a commission to examine these items.
“No reason was given other than DSO was not included in our original project submission,” Chief Executive Officer Simon Hay said on a call Monday. “The mines minister who took this decision was appointed in early July and the previous mines minister was very supportive of DSO.” Leo Lithium had planned to export up to 139,000 tons of unrefined ore before beginning to ship concentrate next year.
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Leo Lithium said initial documents have been provided to Mali’s government on the transfer of the 10% stake to which the state is legally entitled, and Mali has an option to subscribe for an additional 10% interest at market value, according to the filing.
“We strongly recommended that it’s not good that our gold, that our resources, leave the country without being transformed on the spot,” Abdoulaye Pona, the president of Mali’s Chamber of Mines, said by phone.
--With assistance from Katarina Hoije.
(Updates with comments from CEO in sixth paragraph)
