Kodal Minerals PLC (AIM:KOD) told investors that the construction of the Phase 1 Dense Media Separation (DMS) processing plant and crushing circuit at the Bougouni lithium project is progressing on schedule.
The project, located in Southern Mali, is fully-funded following the completion of the US$117.5 million Hainan transaction (announced in November), and, it is on track for first production in the fourth quarter of 2024.
Phase 1 of the project is expected to see around 125,000 tonnes of production per year, with this initial part of the project expected to have a capital cost of around $65 million.
Construction update
It is anticipated that the shipping of equipment to West Africa from China will occur on or around 5 June.
Structural steelwork fabrication is also advancing on site, with the initial shipping of structures to the project site anticipated on a similar date.
It comes after a consortium of mining contractors were mobilised to Bougouni in April.
Site clearing is complete, and plant construction is due to start in early June.
A civil construction contract has been awarded to Bambara Resources and GZB, which are expected to mobilize to the site soon, the company added.
Also, ongoing resource definition and extension drilling is continuing on the Boumou prospect, which is part of the Bougouni project.
Geological logging indicates continuity of the pegmatite bodies over a 970-meter strike length, the company noted, with all assay results still pending (some 2,128 samples will be tested).
Chinese charter significantly reduces project timeline
"The development of the Bougouni project is advancing as planned, both off-site and on-site, ahead of first production scheduled for the end of calendar 2024,” chief executive Bernard Aylward said.
“It is pleasing that the manufacture of Bougouni's long lead equipment is progressing on schedule and that the Kodal Mining UK Limited (KMUK) project team has secured a dedicated part-charter shipment from China to West Africa scheduled to depart in early June 2024."
"The charter vessel will transport all major equipment, steelwork, supplies and reagents required for the project from China direct to the Port of Abidjan in Côte d'Ivoire, which has direct links to Bougouni via a secure road network.
“Securing a port-to-port direct cargo ship is a major benefit to delivering our flagship Project on time as it will significantly reduce the transport time to around 21 days."
Aylward added: “the mining contractors have commenced site works at Bougouni and the plant site area is cleared and readied for concrete installation, marking a huge leap forward in Bougouni's trajectory.
“The civil engineering contract has also been awarded and the first concrete pour is anticipated for early June to prepare the site for the delivery of the DMS processing plant and crushing circuits."
The Kodal boss, meanwhile, highlighted that the latest round of drill was “hugely encouraging” as the anticipated upgrade to resources helps the company as it aims for “50 million tonnes and beyond”.
“Boumou continues to impress and provides the company with near-term potential for resource expansion,” he said.