Japanese chemicals company Mitsui is to pre-pay Sigma Lithium US$30 million under a strategic alliance agreement for the supply of battery-grade lithium concentrate.
Sigma will supply Mitsui with “up to 55,000 tonnes” of material annually for six years, with an option to extend for a further five years.
Sigma said the agreement provided for a significant portion of the funding required for capital expenditures and construction of Sigma’s commercial production plant at its Grota do Cirilo lithium project in Brazil.
Mitsui is supporting the Brazilian project with a disbursement of up to $7 million, to be used “for the deposits required to purchase long lead items for the construction of the commercial production plant”.
The firms’ agreement includes an option for Mitsui to purchase an addition 25,000 tonnes a year, “at then-prevailing market prices”, for the duration of the agreement.
According to a feasibility study design, the lithium concentration plant will have an initial annual processing capacity of 1,500,000 tonnes of spodumene ore, giving an annual capacity of 220,000 tonnes of battery-grade spodumene per year.
Sigma chairman and CEO Calvyn Gardner said Mitsui’s commitment would help to “accelerate development of the project”.
In 2018, Mitsui expanded production of its “ultra-high molecular weight polyethylene” in Japan for lithium-ion battery separators in response to growing demand from the automotive and industrial sectors.