Ganfeng makes first payment for share in Firefinch’s world-class Goulamina lithium JV as FID nears

Chinese lithium giant Ganfeng has made the first payment in its US$194 million JV with Australia’s Firefinch for 50% of the Goulamina lithium mine in Mali, setting the world class project on the path to a final investment decision.

Ganfeng has received both Chinese and Malian government approvals for the deal, which will see Ganfeng pump US$130 million in cash into the project and arrange US$64 million of debt.

The first US$39 million equity tranche has now been deposited by Ganfeng into an escrow account, in line with the conditions of the subscription agreement between the companies.

Firefinch (ASX:FFX) is in the process of spinning out its lithium assets into Leo Lithium, which will separate its interest in Goulamina from Firefinch’s gold business at Mali’s Morila mine.

At that point the Project Exploitation Licence will transfer to the JV company and the cash made available to the project partners, expected early next year.

Goulamina set to get bigger before investment decision

The deal that brought Ganfeng, the world’s biggest lithium company, on board earlier this year was a signal of the significance and scale of the Goulamina asset.

Based on its DFS, the mine is expected to produce 436,000t of spodumene concentrate over a 23-year mine life from 2023.

But Lycopodium has been engaged by Firefinch to update that DFS ahead of an expected investment decision before the end of 2021.

That would consider a stage 2 expansion which would increase plant throughput 75% from 2.3Mtpa to 4Mtpa, increasing production from 450,000t up with the planned throughput upgrade.

That could make the large and high grade Goulamina project one of the largest globally.

Mining