Bougouni Lithium Project Update on Project Development Preparations
Kodal Minerals, the mineral exploration and development company focused on lithium and gold assets in West Africa, is pleased to provide an update on project development activities and general progress at its Bougouni Lithium Project in southern Mali (“Bougouni” or the “Project”).
The Company has continued to make good progress with its detailed engineering works for the DMS (dense media separation) plant utilising in part the conditional prepayment received from Hainan Mining Co. Limited (“Hainan”) of US$3,500,000 (see announcement of 3 August 2023), and confirms that the phased development (change) notification has now been formally submitted to the Direction Nationale de la Geologies et des Mines (“DNGM”) in accordance with the 2019 Mali Mining Code (“Mali Mining Code”) (the “Notification”).
Highlights:
· Kodal executives were in Mali to welcome Hainan’s key representatives who will be working closely with the Company during the finalisation of the design, construction, commissioning and future operations.
· Kodal and Hainan representatives met with the Director General of the DNGM to discuss the progress of the Bougouni Lithium Project and commencement of site development.
· Following completion of the registration of the Company’s new subsidiary mining company in Mali, Le Mines de Lithium de Bougouni SA (“LMLB”), the Company has now submitted the requisite formal Notification which outlines the change to a phased development approach. The Notification details the “Phase 1” DMS development plan at Ngoualana, followed by the future flotation operation (“Phase 2”).
· The DMS plant design is close to completion, with procurement specifications finalised in readiness for the drawdown of the US$100 million funding package from Hainan, which remains subject to final regulatory approvals in Mali (as announced on 31 August 2023).
Bernard Aylward, CEO of Kodal Minerals, remarked: “Kodal and Hainan continue to work closely together to finalise the major funding package as announced 19 January 2023 and significant progress is being made towards completion. Kodal and key Hainan representatives have met in Mali to meet with government officials and undertake site visits in preparation for the commencement of development.
“Our engineering team, with assistance from key consultants and support from Hainan, have submitted our Notification to the DNGM, which outlines the Company’s phased development approach. The Phase 1 DMS development plan provides a fast-track pathway to lithium concentrate production, at comparatively low capital costs and an expected construction timeline of around 12 months, exploiting the coarse grained spodumene prevalent at the Ngoualana deposit.
“Phase 2 will see the construction and commissioning of a down-stream flotation plant which is expected to be supported by utilising Phase 1 cash flows in order to exploit the finer-grained spodumene resources at Sogola-Baoulé and Boumou, as well as longer term exploration prospects.
“The development of Bougouni continues to receive strong support from Mali Government officials and within the local community, and the Company will be commencing the upgrade of local access roads in the coming weeks in preparation for major development activities to commence on site at Bougouni.
“We also take this opportunity to remind our shareholders of our upcoming Annual General Meeting on Friday, 29 September, and look forward to seeing you there.”
FURTHER INFORMATION
As announced on 19 January 2023, the funding package agreed between the Company and Hainan comprises a US$100 million investment to acquire 51% of the Bougouni project company, Kodal Mining UK Limited, and a further US$17.75 million subscription for new ordinary shares in Kodal Minerals PLC at 0.5p per ordinary share.
This week in Mali, Kodal welcomed key Hainan representatives that will form part of the LMLB management team for the development and operation of Bougouni. A meeting was held with the DNGM on 19 September 2023 and during that meeting, the DNGM confirmed that the Bougouni Mining Licence having been awarded under the 2019 Mali Mining Code, remains valid and administered in accordance with the 2019 Mali Mining Code.
The Company has completed the full registration of the new mining company, Le Mines de Lithium de Bougouni SA, that is held by Kodal Mining UK Limited (“KMUK” – the Company’s UK registered subsidiary formed to be the holder of the Mali lithium assets) and further to the announcement on 16 December 2022, has formally submitted to the DNGM the Notification of the proposed mining phases to commence at Bougouni. Summary details of the Notification are:
· The Company has now formalised and submitted its Notification to the DNGM, explaining its proposed two-phase development plan, with Phase 1 being the fast-track low cost DMS installation and Phase 2 being the larger downstream flotation plant operation.
· DMS plant design is close to completion, with procurement specifications finalised in readiness for drawdown of the Hainan US$100 million funding package. Once the funding is received and a final investment decision formalised, the Company will promptly proceed to procure long lead equipment items as defined in those specifications.
· Phase 2 development of the large-scale flotation plant is continuing, with design review and metallurgical testing. Immediate focus is on expanding the Boumou deposit and the potential impact of a larger scale operation that may be developed earlier following recent exploration drilling results, further bolstered by the already significant resource at Sogola-Baoulé which alone totals 12.2Mt @ 1.10% Li2O.
Environmental and Social Governance
Kodal was granted an Environmental Permit over the Project in November 2019. Supplemental studies have been ongoing in 2023, including dust and noise monitoring, surface water and hydrogeological assessments, and waste rock geochemistry analysis. These studies also supported preparation of the Notification.
The Company intends to commence the upgrade of local access roads following the end of the rainy season (October 2023), utilising Malian contractors. The upgrade of existing roads in the project area will improve conditions for the local community as they approach the harvest season and will be of benefit to the Company in upgrading access to the Ngoualana deposit for the commencement of the site development activities.
The Company is continuing to work with the local community to prioritise a community development programme, which involves direct consultation with the local communities, in order to document a programme that will jointly establish priority community development projects and identify how the Company can provide support for these initiatives.
For further information, please visit www.kodalminerals.com
