Highlights:
- Sigma Lithium has received a binding commitment from BNDES
(National Brazilian Bank for Economic and Social
Development) for a BRL487 million
development loan to fully fund the construction of Sigma Lithium's
Second Greentech Carbon Neutral Plant in Brazil.
- Sigma has initiated construction activities on site while
conducting detailed engineering work following the Final Investment
Decision made by its Board of Directors. Based on the current
construction timetable, the Company plans to complete construction
and commissioning in the summer of 2025.
- The Development Loan provides the Company with a 16-year
repayment period at a very low interest rate, a hallmark of
development debt financing. The key terms and conditions are:
- Amount: BRL 487
million
- Term: 192 months (16 years)
- Interest Rate: BRL 7.45% per year.
- Grace Period: 18 months - Amortization Period: 174
months
- Assets in Collateral: Not required. Development Loan shall
be secured by letter of credit ("fianca bancaria") issued by a
BNDES registered financial institution.
- With the second Greentech plant, Sigma expects to
approximately double the production capacity of its Quintuple Zero
Green Lithium from the current 270,000 tonnes per year to a total
of 520,000 tonnes per year.
Sigma Lithium Investor Day on September 24, 2024 at Nasdaq:
The Company will host an Investor Day in
New York on Tuesday, September 24, 2024 at Nasdaq,
featuring a series of presentations focused on Sigma Lithium's
operations and growth initiatives. The Investor Day will also
include a live question-and-answer session with members of the
Company's senior leadership team. Presentations are scheduled to
begin at 10:30 a.m. ET. The event
will be concurrently webcast and accessible on Sigma Lithium's
Investor Relations website at
"ir.sigmalithiumresources.com"
A replay will also be available on the Investor Relations website
following the conclusion of the live event.
SÃO PAULO, Aug. 29,
2024 /PRNewswire/ -- Sigma Lithium Corporation
(NASDAQ: SGML, BVMF: S2GM34, TSXV: SGML), a leading global
lithium producer dedicated to powering the next generation of
electric vehicles with carbon neutral, socially and environmentally
sustainable Quintuple Zero Green Lithium Concentrate received a
binding commitment letter dated August 27,
2024 ("Award Letter - Carta 64/2024 – BNDES
GP/SG/ROD") from BNDES ("National Brazilian Bank for
Economic and Social Development") with the final approval for a
BRL 486.8 million development loan to
fund the construction of a Second Greentech Carbon Neutral
industrial production plant for lithium concentrate at Vale do
Jequitinhonha in Brazil ("Second
Greentech Carbon Neutral Plant").
The Award Letter by BNDES outlines its binding
commitment to extend the Company a development loan as decided by
its Credit Committee to be funded from the National
Climate Change Fund ("Fundo Nacional de Mudanca Climatica –
FNMC, Climate Fund Program") in accordance with the
terms and conditions outlined in the supporting documents
(specifically "Decisao DIR 222/2024-BNDES") and in the
Development Loan agreement.
The approved funding of BRL 487 million represents almost 99% of
the BRL 492 million capex budget
submitted to BNDES for the construction of the Second Greentech
Carbon Neutral Plant, as per the Letter of Intent and the news
release issued by the Company on 12 February
2024. Sigma's capital budget for the construction of the
Second Greentech Carbon Neutral Plant has benefitted from
fluctuations in local currency values, as most of the equipment is
produced and assembled in Brazil
and/or quoted in BRL.
The Development Loan provides the Company with a
16-year repayment period at the low interest rate of 7.45% per year
(below the current Brazilian sovereign interest rate of 10.5%), a
hallmark of development debt financing. As a result of the
significant duration of this new loan to finance construction,
during the third quarter of 2024 the Company has decided to retire
most of its unused existing short term trade finance lines. Sigma
is repaying these lines using its current cash position.
The closing of the Development Loan remains
subject to the Company's submission of satisfactory letters of
credit ("Cartas de Fianca Bancaria") issued by Brazilian banking
institutions accredited by BNDES, as well as the customary closing
conditions for a Development Loan of this nature, including the
Company's constant adherence to the operating policies of BNDES.
Closing conditions for the Development Loan do
not include lithium market-related conditions and cyclical lithium
market and pricing elements that fall outside of the control of the
Company, as the Development Loan is a long-term development
industrial & climate policy instrument by BNDES.
With the Second Greentech Carbon Neutral Plant,
Sigma plans to double its production capacity of its Quintuple Zero
Green Lithium from the current 270,000 tonnes to approximately
520,000 tonnes. The Second Greentech Carbon Neutral Plant will
introduce innovations that will further increase the efficiency of
its industrial process to beneficiate mineral spodumene ore into
Quintuple Zero Green Lithium pre chemical high purity
concentrate.
Sigma initiated construction activities on site
following the Final Investment Decision made by its Board of
Directors. Based on the current construction timetable, the Company
expects to conclude construction and commissioning in the summer of
2025.
The Development Loan is part of a broader
strategic plan by BNDES to foster in Brazil the development of a competitive and
scalable industrial supply chain to globally supply environmentally
and socially sustainable industrialized lithium materials. BNDES
stated in the letter that the Development Loan for Sigma Lithium to
expand carbon neutral lithium industrial production capacity is
part of BNDES' long-term strategy to support the development of a
scalable, green and socially inclusive industrial base in
Brazil.
Ana Cabral, CEO
and Co-Chairman said: "We were honored with the award by BNDES's
Directors of the binding commitment letter for our development loan
to finance the construction of our second Greentech lithium plant,
which will double the production scale of our industrial
facilities. The award of this development loan by BNDES crowns over
10 years of relentless execution by our team at Sigma Lithium to
build our global leadership in the industrial production of carbon
neutral, environmentally sustainable and socially traceable lithium
materials. Our unparalleled operational success has significantly
contributed to attracting investment in Brazil from other global lithium companies,
creating one of the world's fastest growing producing territories.
Having BNDES as a creditor represents the support of the government
of Brazil for Sigma Lithium's
industrial expansion plans at Vale do Jequitinhonha'.
"In the last decade, we have pioneered and
consistently championed the socially inclusive and environmentally
sustainable industrialization of battery materials. As a result,
our region, once one of the most impoverished in Brazil, now prospers and is known the world
over as "Lithium Valley". BNDES support allows Sigma to further
amplify its socially transformational impact in Lithium Valley:
illustrating the effects of how a just and inclusive energy
transition has the potential to lift an entire region."
She added "we believe that with the optimum
long-term capital structure enabled by this development loan by
BNDES, Sigma Lithium has a unique opportunity to solidify its
global industrial competitive leadership in producing low cost,
environmentally and socially sustainable Quintuple Zero lithium
materials to supply the next generation of electric vehicles, which
are fully aligned with the ethos of their traceability conscious
consumers. BNDES has demonstrated a visionary long-term
counter-cyclical approach to industrial policy financing, in line
with its peers in large industrial countries, by fostering the base
industry of lithium materials beneficiation, despite the
deterioration in the short-term market outlook this year".
ABOUT SIGMA LITHIUM
Sigma Lithium (NASDAQ: SGML, BVMF: S2GM34, TSXV: SGML) is a
leading global lithium producer dedicated to powering the next
generation of electric vehicle batteries with carbon neutral,
socially and environmentally sustainable chemical-grade lithium
concentrate.
Sigma Lithium is one of the world's largest lithium producers.
The Company operates at the forefront of environmental and social
sustainability in the EV battery materials supply chain at its
Grota do Cirilo Operation in Brazil. Here, Sigma produces Quintuple Zero
Green Lithium at its state-of-the-art Greentech lithium
beneficiation plant that delivers net zero carbon lithium, produced
with zero dirty power, zero potable water, zero toxic chemicals and
zero tailings' dams.
Phase 1 of the Company's operations entered commercial
production in the second quarter of 2023. The Company has issued a
Final Investment Decision, formally approving construction to
double capacity to 520,000 tonnes of concentrate through the
addition of a Phase 2 expansion of its Greentech Plant.
Please refer to the Company's National Instrument 43-101
technical report titled "Grota do Cirilo Lithium Project Araçuaí
and Itinga Regions, Minas Gerais, Brazil, Amended and Restated Technical Report"
issued March 19, 2024, which was
prepared for Sigma Lithium by Homero
Delboni Jr., MAusIMM, Promon Engenharia; Marc-Antoine Laporte, P.Geo, SGS Canada Inc;
Jarrett Quinn, P.Eng., Primero Group
Americas; Porfirio Cabaleiro
Rodriguez, (MEng), FAIG, GE21 Consultoria Mineral; and
William van Breugel, P.Eng (the
"Updated Technical Report"). The Updated Technical Report is filed
on SEDAR and is also available on the Company's website.
For more information about Sigma Lithium,
visit https://www.sigmalithiumresources.com/
Sigma Lithium
LinkedIn: Sigma Lithium
Instagram:
@sigmalithium
X: @SigmaLithium
FORWARD-LOOKING STATEMENTS
This news release includes certain "forward-looking
information" under applicable Canadian and U.S. securities
legislation, including but not limited to statements relating to
timing and costs related to the general business and operational
outlook of the Company, the environmental footprint of tailings and
positive ecosystem impact relating thereto, donation and upcycling
of tailings, timing and quantities relating to tailings and Green
Lithium, achievements and projections relating to the Zero Tailings
strategy, achievement of ramp-up volumes, production estimates and
the operational status of the Grota do Cirilo Project, and other
forward-looking information. All statements that address future
plans, activities, events, estimates, expectations or developments
that the Company believes, expects or anticipates will or may occur
is forward-looking information, including statements regarding the
potential development of mineral resources and mineral reserves
which may or may not occur. Forward-looking information contained
herein is based on certain assumptions regarding, among other
things: general economic and political conditions; the stable and
supportive legislative, regulatory and community environment
in Brazil; demand for lithium, including that such demand is
supported by growth in the electric vehicle market; the Company's
market position and future financial and operating performance; the
Company's estimates of mineral resources and mineral reserves,
including whether mineral resources will ever be developed into
mineral reserves; and the Company's ability to operate its mineral
projects including that the Company will not experience any
materials or equipment shortages, any labour or service provider
outages or delays or any technical issues. Although management
believes that the assumptions and expectations reflected in the
forward-looking information are reasonable, there can be no
assurance that these assumptions and expectations will prove to be
correct. Forward-looking information inherently involves and is
subject to risks and uncertainties, including but not limited to
that the market prices for lithium may not remain at current
levels; and the market for electric vehicles and other large format
batteries currently has limited market share and no assurances can
be given for the rate at which this market will develop, if at all,
which could affect the success of the Company and its ability to
develop lithium operations. There can be no assurance that such
statements will prove to be accurate, as actual results and future
events could differ materially from those anticipated in such
statements. Accordingly, readers should not place undue reliance on
forward-looking information. The Company disclaims any intention or
obligation to update or revise any forward-looking information,
whether because of new information, future events or otherwise,
except as required by law. For more information on the risks,
uncertainties and assumptions that could cause our actual results
to differ from current expectations, please refer to the current
annual information form of the Company and other public filings
available under the Company's profile
at www.sedarplus.com.
Neither the TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this news release.
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SOURCE Sigma Lithium Corporation
