Kodal Minerals PLC (AIM:KOD) has agreed an MoU for the transfer of the Bougouni lithium project to a new entity 35% owned by the government of Mali.
Once the transfer is signed off the Bougouni licence will be in full compliance with all legal requirements and in good standing, Kodal added.
Bernard Aylward, Kodal’s chief executive, said: “The MoU with the State for the transfer of the Bougouni mining licence is the final legal step required as we rapidly progress the construction of the project, with production on track for the first quarter of 2025.”
The new entity, Les Mines de Lithium de Bougouni SA (LMLB), will be 65% owned by KMUK a joint venture between Kodal (49%) and Chinese group Hainan (51%).
Bougouni is being funded by US$117.5 million provided by Hainan, which includes a US$100 million investment into KMUK, the project developer.
Kodal added that the mining licence will transfer with an initial 10-year term, with the Mali government granting permits for operation, including for the export of spodumene products.
A cash payment of US$15 million is payable to the Mali government in relation to the Hainan transaction, to be executed in two equal instalments with the first following the signing of the MoU and the final prior to 31 March 2025.
Aylward added: “The transfer of the mining licence to the mining company LMLB confirms the good standing of the project and provides certainty of State support and ongoing stability of Bougouni.”