Lithium Ionic Secures $266 Million Loan Guarantee for Bandeira Lithium Project in Brazil
Lithium Ionic has announced that it has received preliminary approval for a $266 million loan guarantee from the Export-Import Bank of the United States (EXIM) to support the development of its flagship Bandeira lithium project in Minas Gerais, Brazil. The funding will cover 100% of the project’s initial capital cost, as outlined in a feasibility study released in May 2024.
The company will now work closely with EXIM, the official export credit agency of the United States, to complete due diligence and finalize a definitive financial agreement. The Bandeira project’s feasibility study projects an after-tax net present value of $1.3 billion, with an internal rate of return of 40% and a payback period of 3.4 years. The study assumes a spodumene price of $2,277 per tonne.
The underground mine is expected to produce approximately 17.2 million tonnes of lithium carbonate equivalent, grading 5.5% lithium oxide, over a 14-year lifespan. Lithium Ionic aims to commence construction and production at the Bandeira site within the next two years.
Bandeira is located just northeast of Araçuaí, in an area well-connected by infrastructure. The project's claims cover 1.6 square kilometers, representing only about 1% of Lithium Ionic's total 141.8-square-kilometer land package in the so-called “Lithium Valley,” which also includes the company's Salinas project located roughly 120 kilometers north of Bandeira.
The announcement has had a positive effect on the company's share price, with Lithium Ionic shares rising 4.3% by mid-morning November 28 in Toronto, giving the company a market capitalization of approximately CAD 154 million (USD 110 million).
