Atlantic Lithium describes first Ghana mining lease as historic

The London Stock Exchange registered company, Atlantic Lithium has announced the signing of what is the first lithium mining license to be granted in Ghana, describing it as “historic”.

According to Atlantic, Ghana’s Ministry of Lands and Natural Resources has granted a Mining Lease in respect of the Company’s flagship Ewoyaa Lithium Project (“Ewoyaa” or the “Project”), comprising the proposed Ewoyaa Lithium Mine and Processing Plant, enabling the advancement of the Project towards commercial production.

In a press release copied to Ghana Business News, Atlantic said the  Mining Lease terms, secured in the interests of all stakeholders through close cooperation with the Ghana government, in line with establishing its new Green Minerals Policy, maintain the Project’s position as one of the lowest capital and operating cost hard rock lithium projects globally and indicate strong commercial viability and exceptional profitability potential for a 2.7Mtpa steady state operation, producing a total of 3.6Mt of spodumene concentrate (approximately 350,000tpa) over a 12-year mine life.

The company indicated that the Lease grants it exclusive rights to carry out mining and commercial production activities over the Mining Lease area for an initial 15-year period, renewable in accordance with Ghanaian legislation.

“Under the terms of the Mining Lease, the Company agrees to list on the Ghana Stock Exchange and is provided the opportunity, with incentives offered by the Ghana government as support, to participate in further value addition by undertaking studies to assess the viability of the production of feldspar at Ewoyaa and for downstream conversion in Ghana, offering the potential to significantly enhance shareholder value,” it added.

Neil Herbert, Executive Chairman of Atlantic Lithium, is quoted as saying: “As the first to be granted for lithium in the country, the award of the Mining Lease for the Ewoyaa Lithium Project is auspicious for both Ghana and Atlantic Lithium. It serves as Ghana’s statement of intent to establish itself as a leading hub in Africa in the electric vehicle supply chain through the long-term production of lithium, with Atlantic Lithium as its partner of choice in this objective.

“The Mining Lease is a major endorsement of the viability of the Project and a landmark de-risking milestone in its advancement towards production. The Government of Ghana, which is eager to build upon its mining history that spans back over a century and diversify away from its long-standing gold production, has remained incredibly cooperative throughout our application process. We wholeheartedly welcome their support, alongside the intent shown by Ghana’s sovereign wealth fund, MIIF, at this pivotal moment.”

Mr Samuel Abu Jinapor, the Minister of Lands and Natural Resources, signed on behalf of the government, and Mr Neil Herbert, Chairman of Lithium Atlantic, signed for his company.

Speaking at the signing ceremony, Mr Jinapor said in 2017, Atlantic Lithium started exploration for lithium at Ewoyaa and discovered high grade of the mineral in commercial quantity.

By the mining laws of the country, however, where a company undertakes exploration and discovers minerals in commercial quantities, it is entitled to the first right of refusal if it wants to go into mining of the mineral and it is entitled to be given a mining lease to that effect.

The Minister said the government had a vision of treating the mining of the new green minerals differently from previous ones, hence the formulation of a policy to ensure that the mineral inure to the benefit of the people.

It was also to make sure the mining firms respected the sanctity of the contracts, and without breaching the country’s mining laws.

Accordingly, on July 13, 2022, on behalf of the President, the Minister presented a policy statement on the development and management of the green minerals to Parliament, which was anchored on guaranteeing their exploitation benefitted Ghanaians, the true owners of the mineral.

Subsequently, he said, the policy was submitted to Cabinet, which after considerable debate and critique, approved on July 27, 2023.

Some of the key features in the policy include an increase in royalty rate, increase in Ghanaian participation in all green mineral operations to a minimum of 30 per cent, enhanced local content and local participation, including listing on the Ghana Stock Exchange; and value addition and beneficiation.

Based on those policies, the Minister said the government entered negotiations with Atlantic Lithium, which at certain times, the President Akufo-Addo himself, as a lawyer, made several inputs to ensure that the country got the best deal.

“So following series of negotiations, we concluded an agreement with Atlantic Lithium for the exploitation of lithium in Ewoyaa in the Central Region,” Mr Jinapor said.

“And today, we are granting to the company a mining lease to commence construction for the mining of lithium.”

By Emmanuel K Dogbevi, with additional files from the GNA