Image Credits : With the contributions, the nominal capacity of the Grota do Cirilo complex will increase from 270 thousand tons/year to 520 thousand tons/year | Credit: Mara Bianchetti | visual for illustration purpose
2 minutes read

Sigma will invest US$100 million to double lithium production in Brazil

Sigma Lithium will practically double its green lithium production at the Grota do Cirilo industrial complex, in the Jequitinhonha Valley, after its board of directors approved investments of US$100 million (around R$505 million) in the installation of a second line. The investment will allow the company’s production to jump from 270 thousand tons per year (t/a) to 520 thousand t/a in 2025. The announcement was made on Monday (1st), when the company released a balance sheet preliminary financial report for 2023.

According to a published balance sheet , total revenue was US$135.1 million in 2023. Ebtida (earnings before interest, taxes, depreciation and amortization) was US$24.5 million, with a margin of 36.4%. Short- and long-term loans and export prepayment liabilities totaled US$129 million at the end of the year. The data has not been audited.

Work to build the second line of the Greentech industrial plant , located between the cities of Itinga and Araçuaí, in the Jequitinhonha Valley, will begin this month and will generate approximately 200 direct jobs. The expansion is expected to be completed by the end of 2024. As it has already obtained an environmental license to build and operate the new plant, Sigma expects lithium production to begin in the first quarter of 2025.

The company’s expectation is that the project will be financed by the National Bank for Economic and Social Development (BNDES), after receiving a letter of intent from the public bank. The mining company states that it has all the resources to satisfy Capex financing, in the proposed construction plans and calendar, whether due to unused financing lines, the expected generation of free cash flow (FCF) and the cash balance, which it was US$109.4 million at the end of March.

In the fourth quarter of last year, the company made investments to increase the efficiency of the Greentech Plant. Thus, capital expenditures in the period were US$6.5 million and the company was able to generate almost US$30 million in FCF.

 

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