Sigma Lithium Corp (TSX-V:SGML, NASDAQ:SGML) has announced significant project updates and renewed commitments to its existing social initiatives as it transitions from the development stage to production.
The company said it was awarded its environmental operating license (LO) on March 31, 2023, permitting it to produce green lithium and sell all green lithium product from current and future production, including any stockpiled product. The move also enables the company to commence commercial operations at its Phase 1 Mine and Greentech Plant.
Commissioning of the Phase 1 dense medium separation (DMS) circuit of its Greentech Plant remains on schedule with initial production expected to commence in April 2023. This follows the successful completion of crushing circuit commissioning of the Greentech plant, Sigma Lithium added.
The company noted that it has held the required dual environmental licenses for both construction and initiation of its wholly-owned Grota do Cirilo project since 2019. It obtained both the construction license as well as the installation and commissioning license for its Greentech Plant from the Conselho Estadual de Politica Ambiental (COPAM), which is the Council of Environmental Policy of the State of Minas Gerais in Brazil.
The dual LP and LI certificates permitted the company to build and install the Phase 1 Mine and Greentech Plant, conduct trial mining, and test the Greentech Plant, including stockpiling product as part of the commissioning and ramp-up of production capacity. COPAM issued the dual LP and LI certificates for six years expiring on May 31, 2025.
“As a result of this significant milestone and the project nearing commercial production, Sigma Lithium was honoured to receive a visit from the Governor of the State of Minas Gerais and his senior leadership team, including members of the Minas Gerais State legislative assembly, congressmen representing the region in Brazil's National Congress, representatives of the State General Attorney office, the commander in chief of the Military Police for the 60 municipalities of Vale do Jequitinhonha, and the mayors of Itinga and Araçuaí,” Sigma Lithium said in a statement.
“Discussions were centered around the broader development of the region of Vale do Jequitinhonha and the pivotal role of the lithium value chain. Estimates from the State of Minas Gerais envision that Sigma Lithium's investments will generate approximately 6,000 indirect jobs, in addition to about 650 direct permanent and contract jobs averaging over the forecasted life of the Grota do Cirilo Phase 1 operation (in addition to over 1,000 jobs created in the construction phase of the Greentech Plant),” it added.
Appointment of engineering firms to lead Greentech Plant expansion studies and construction
Sigma Lithium said it has appointed DRA Global Limited to work alongside Promon Engenharia on the design and construction of the Phase 2 & 3 expansion of the Greentech Plant, which is expected to be fully funded internally through cash flow generation.
It noted that the final objective for DRA and Promon in detailed engineering will be to determine an FEL-3 (front-end loading) level capital expenditure (capex) for the Phase 2 & 3 expansion and to obtain quotes for a fully costed estimate. The FEL-3 capex will generate an actionable list of long-lead items for deposits or prepayments supporting the predictability of capex and the construction timetable.
Positive results of the completed engineering report, along with the feasibility study results, economic analysis and other reports, are expected to be used by the company’s Board to support a potential decision to proceed with the Greentech Plant Expansion. The detailed engineering report is expected to be completed in the second quarter of 2023.
DRA was selected for its international experience in advanced mineral processing, specifically with lithium DMS plant design, and its construction management experience. DRA has a track record of on-time and on-budget execution of assignments in the mining, metals and chemical sectors, the company added.
Scaling up of social initiatives to deliver on UN Sustainable Development Goals
As it advances to becoming a lithium producer, Sigma Lithium also announced the scaling up of its existing social initiatives, aiming at lifting its communities and supporting women's economic empowerment.
- Microcredit for 10,000 female entrepreneurs
- Sigma Lithium said it has established the largest privately funded microcredit program in Brazil, targeting female entrepreneurs in the Jequitinhonha Valley region, with a target total enrollment of up to 10,000 women. The program reaches approximately 50% of the economically active female population of the broader urban and rural areas of the towns of Itinga and Aracuai. The initiative is developed jointly with NGO ‘Dona de Mim,' part of ‘Mulheres do Brasil’, the largest civil society movement in the country with over 120,000 women as members of its network.
- Through the program, the company said it will encourage sustainable development by providing microcredit loans of 2,000 reais (approximately US$400) per person along with mentorship programs to support the entrepreneurs on their journey to financial self-sustainability. The total investment by the company is estimated at approximately 25 million reais (approximately US$5 million) to be deployed over the next 12 months, including ongoing entrepreneurship training and monitoring costs.
- Sigma Lithium said that a total of 730 female entrepreneurs have now enrolled in the program and that 500 participants have already received a microcredit loan. Most recently, 500 women from the microcredit program attended the Governor's visit with Sigma Lithium. The program aims to advance the goals of UN SDG #5 (Gender Equality) and UN SDG #10 (Reduced Inequalities).
- Combating violence against women program
- The company also announced plans to introduce a program, in partnership with the State-General Attorney of the state of Minas Gerais and the Military Police of Minas Gerais to combat domestic violence against women in the Jequitinhonha Valley region. This program advances the goal of UN SDG #5 (Gender Inclusion), UN SDG #10 (Reduced Inequalities) and UN SDG #16 (Peace, Justice and Strong Institutions).
- Zero drought for smallholder farmers
- Additionally, Sigma Lithium said it announced during its participation at the COP-27 summit in Egypt its ‘Zero Drought for Smallholder Farmers’ program, a climate mitigation initiative of building 2,000 rainwater capture basins for smallholder family farmers in the municipalities of Itinga and Araçuaí in the Jequitinhonha Valley. The program reaches approximately 50% of the local rural agricultural lands of the towns of Itinga and Aracuai. These water capture basins will be dug into the ground and located at strategic points to prevent soil erosion during the heavy rainfall season, store water for irrigation of small crops during the nine-month dry season and contribute to increasing the volume of water that will feed the region's aquifers.
- The company said the total investment is estimated at 4 million reais (2,000 reais per structure). It is delivering the structures to the municipalities as a donation, which are currently being built via third-party contractors under the supervision of Sigma Lithium's ESG teams. This program advances the goal of UN SDG #10 (Reduced Inequalities), UN SDG #15 (Life on Land) and UN SDG #13 (Climate Action).
- Water for all
- Finally, the company said it committed to donating 3,000 water tanks as a further climate mitigation initiative, aimed to increase water security for communities in the Jequitinhonha Valley. It said it is also committed to maintaining water supply of the tanks by providing water trucks year-round, enhancing water security for the communities. This program, which is now in progress, advances the goals of UN SDG #6 (Clean Water and Sanitation) and UN SDG #13 (Climate Action).
Contact the author at stephen.gunnion@proactiveinvestors.com