Kodal Minerals PLC (AIM:KOD) acquired the minority interests in the Bougouni lithium project in southern Mali and now owns 100% of the concessions at the project.
In a statement, the mineral exploration company said it bought the 10% minority interest from original owners Gorutumu Mining SARL and Triumvirat Mining Company SARL, which will receive a cash payment of US$600,000 each.
In addition, Kodal will pay each vendor a net smelter return (NSR) royalty of 0.6%.
Initial feasibility studies at Bougouni indicate a minimum 8.5-year mine life producing on average 220,000 tonnes of 6% spodumene concentrate per year, with a total life of mine production of 1.94 million tonnes (Mt) of concentrate and life of mine revenue exceeding US$1.4bn.
The mining licence application for Bougouni is with the office of the Prime Minister of Mali, awaiting final signature.
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Kodal chief executive Bernard Aylward said: "These acquisitions provide Kodal and its shareholders with 100% ownership of the Bougouni concessions and full exposure to development of the existing 21Mt at 1.1% Li2O [lithium oxide] that is defined at the project, as well as continued expansion through ongoing exploration activity.
“These acquisitions further strengthen Kodal's ability to negotiate value accretive development opportunities and financing structures, which will be key as we move towards our construction phase.”
The CEO said Bougouni is an advanced project with a relatively short time horizon to first production, which places Kodal in an ideal position to benefit from the increasing demand for lithium globally, particularly from the electric vehicle (EV) industry.
“The strongly rising prices for spodumene concentrate highlight the opportunity for Bougouni's development with recent pricing levels reported of over US$1,360 per tonne 5% Li2O spodumene concentrate, compared with the initial US$680 per tonne for 6% Li2O spodumene concentrate used in the 2020 feasibility study,” Aylward said.