ASX-listed Leo Lithium has obtained conditional approval from the Mali government for the sale of its remaining 40% stake in Mali Lithium BV (MLBV) to China’s Ganfeng, marking a significant move towards the company’s exit from the Goulamina lithium project.
The Mines Minister has conditionally approved the transaction, stipulating the submission of transaction documents and the payment of capital gains tax (CGT).
Leo has already settled $7.6 million in CGT for a 5% sale completed on May 6. Additional CGT on the 40% stake sale will be paid accordingly.
Leo recently announced its decision to divest its remaining interest in MLBV after failing to resolve issues with the Mali government concerning the project.
Leo’s Managing Director, Simon Hay, commented positively on the government’s approval, stating, “This marks a positive step in our exit process from the project.
While we would have preferred to continue our involvement in Goulamina, the lack of a viable agreement with the Mali government has led us to this decision, which we believe is in the best interest of all stakeholders.”
Goulamina is a prominent lithium development globally, with Stage 1 spodumene concentrate production estimated at 506,000 tonnes per year, projected to increase to a peak of 880,000 tonnes per year in Stage 2.
The project anticipates a minimum mine life of 23 years, yielding 15.6 million tonnes of spodumene concentrate over that period.
Under the terms of the agreement, Ganfeng will pay Leo $342.7 million for the remaining stake in Goulamina.
With Ganfeng assuming full ownership of MLBV, it has been agreed that Ganfeng will take over project management responsibilities this month, ahead of the finalization of the sale.
Given Ganfeng’s ongoing build-up of its operational team, Leo will provide management services to Ganfeng under a services agreement for up to six months, concluding by November 13 at the latest.
