Proactive Investors - Kodal Minerals PLC (LON:KOD) reported significant progress on its Bougouni lithium project in southern Mali, with all funds from the US$117.75 million funding transaction with Hainan Mining (SS:601969) received and the mining contractor due to mobilise this month.
The mineral exploration and development company said Bougouni is "on track" to start production in the final quarter of the year, with the first stage fully financed with all permitting in place.
A management team for the project company, Kodal Mining UK (KMUK), is now in place, having reviewed the project development plan and confirmed a US$65 million capital expenditure for Stage 1, which involves a dense media separation (DMS) approach.
The team has placed orders for crucial long lead items such as DMS units and dual stream crushing modules with suppliers in China, construction of access roads was completed (pictured), and a mining contract has been finalized with a local consortium.
Kodal CEO Bernard Aylward said the contractor will begin with site clearing works in early April along with other key site establishment activities.
"The integration of the Hainan and Kodal groups within KMUK has been very pleasing; this positive collaboration is very important to keep our development momentum moving forward," Aylward said.
Following the completion of the main access road, the Mali minister for environment visited the site late last month.
"I'm pleased to confirm that the Minister has since followed up on his visit with a formal letter, confirming his approval of the proposed plan for the Phase 1 DMS project," said Aylward.
"These are all major milestones for the company and underpins our target of moving into production at Bougouni before the end of 2024."
An updated Environmental and Social Impact Assessment (ESIA) for the project has also been approved, and negotiations with local communities on land compensation were said to be making good progress.
Hainan's investment includes a US$100 million investment for a 51% stake in the project company, KMUK, and an additional US$17.75 million from the subscription for new ordinary shares.