Lithium Ionic has secured a non-binding letter of interest (LOI) from the Export-Import Bank of the US to provide up to $266m (C$372.59m) in debt financing for its Bandeira lithium project in Brazil.
This financing, with a repayment term of 15 years, is intended to cover the full capex for the project, as detailed in a feasibility study conducted in May.
The Bandeira project in Minas Gerais, known as Brazil's Lithium Valley, is pivotal to Lithium Ionic's expansion plans.
It is set to significantly contribute to the global lithium supply, which is crucial for energy storage solutions and electric vehicle batteries.
Aligned with Exim's China and Transformational Export Programme, the financing aims to strengthen the US supply chain for essential materials such as lithium, which are vital for energy security and transportation electrification.
The Bandeira project’s feasibility study indicated a 14-year mine life, an annual production of 178,000 tonnes (t) of 5.5% lithium oxide spodumene concentrate and on-site operating costs of $444/t.
The feasibility study also highlighted a capex of $266m, forecasting a post-tax net present value of $1.3bn and an internal rate of return of 40%.
Although the Bandeira project accounts for only 1% of Lithium Ionic’s 17,000 hectares of holdings in the Lithium Valley, it is seen as integral to the company's growth strategy.
Lithium Ionic CEO Blake Hylands said: “This LOI from EXIM is a major achievement for Lithium Ionic, providing a clear pathway to fully fund the development of the Bandeira Project.
“Securing this support demonstrates the viability of the project, reflects the strength of our project and team, and the growing recognition and importance of Brazil’s Lithium Valley in the global move towards electrification.
“We extend our sincere appreciation to the US Southern Command (SOUTHCOM) and the US State Department for their direct interest in the project and for reaffirming its strategic value to the security of the US, Canada and partner nations.”
Earlier this year, Lithium Ionic closed the acquisition of the remaining 15% stake in select Salinas properties, gaining 100% ownership of the lithium-rich assets in Minas Gerais, Brazil.
