Birimian (ASX: BGS) has secured an offtake agreement for 55% of its planned lithium production from its Goulamina project in southern Mali.
The offtake memorandum of understanding was inked with General Lithium Corporation, which is a reputed major chemical convertor in China.
Under the agreement, General Lithium will purchase 200,000tpa of 6% spodumene concentrate from Birimian with negotiations to continue until a binding agreement has been bedded down.
General Lithium will purchase the concentrate based on global market prices.
Changsha Research Institute collaboration
The news follows yesterday’s letter of intent with China’s Changsha Research Institute of Mining and Metallurgy to discuss progressing Goulamina including project financing, off-take and engineering, procurement and construction matters.
According to Birimian, Changsha is division of China Minmetals Corporation, which is one China’s largest construction, metals and mining groups which generated $100 billion in revenue during 2017.
“Birimian is pleased to be entering discussions with Changsha on the Goulamina lithium project,” Birimian executive director Mark Hepburn said.
“Changsha and their associated companies have operations in all parts of the world, including Africa,” he noted.
The agreement will afford Birimian Changsha’s expertise and pave the way for the parties to advance Goulamina in a “mutually beneficial” way.
Minmetals’ managed assets reached $320 billion in 2017.
Goulamina lithium project
Goulamina has what Birimian claims is the world’s sixth largest spodumene mineral resource which totals 103.2 million tonnes at 1.34% lithium.
Goulamina lies within Birimian’s Torakoro permit which covers 100 square kilometres. The company has also lodge applications for almost 200sq km in adjacent tenements.
In July this year, Birimian announced a maiden reserve of 31.2Mt at 1.56% lithium for Goulamina.
Birimian is looking to develop a 2Mtpa operation to produce 362,000tpa of spodumene concentrate.
A pre-feasibility study into the project estimated capital expenditure of US$199 million would be needed to build a 16 year operation that would generate annual earnings before interest tax depreciation and amortisation of US$128 million.
The known mineral resource at Goulamina remains open along strike and at depth, with exploration ongoing across the deposit.
Before the end of the year, Birimian hopes to complete all environmental and mine permitting, with feasibility and definitive engineering studies to be finished in 2019.
Also next year, Birimian expects to lock-in project financing and offtake arrangements to begin construction for targeted first production in 2020.