Mitsui to invest £23m ($30m) in Grota do Cirilo, to tap into Brazil’s lithium for electric car batteries

Mitsui to invest  £23m ($30m) in Grota do Cirilo, to tap into Brazil’s lithium

Brazil could emerge as a major supplier for high-quality lithium – a raw material used in electric-car batteries- after Mitsui & Co, one of the world’s biggest commodity traders agreed to invest £23m ($30m) in Grota do Cirilo, a hard rock lithium deposit being developed by Canadian miner Sigma Lithium Resources, in return for quarter of its initial output of 220, 000 tonnes.

The cash from the Mistsui deal and £31m ($40m) debt offering will enable Sigma to start construction of a processing plant by 2020 at the site in the south-eastern province of Minas Gerais and plans to ship its materials to China, where it will be converted into Lithium hydroxide, the type of Lithium used by Tesla in its car batteries.

Demand for Lithium is expected to rise over the next decade because of an increasing sales of electric  vehicles.

Mina Gerais  welcome this good news as earlier this year it was rocked by the deadly mining disaster and a dam holding waste or tailings form an iron ore mine suddenly burst in January releasing a torrent of  material that cut through local community,  killing at least 300 people.  

Calvyn Gardner Sigma’s chairman and CEO said he expected Brazilian regulators to grant an installation licence for Grota do Cirilo in the next  couple of months. “ We can ship material to China for $340 to £360 a tonne”. Mitsui also has the right to buy a further 25, 000 tonnes a year of Lithium from Sigma over a period of six years.

Sigma will be using dry processing technology to produce lithium concentrate,  a refined version of the metal, so it did not need a dam to store waste materials and water.