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Minas Gerais Launched An Initiative To Attract International Investors For Lithium Exploration In The Jequitinhonha Valley Region.
The campaign, called Lithium Valley, is a collaboration with the federal government and aims to position the region as a production center for one of the critical minerals of the energy transition. Lithium is an essential component of batteries, and the expected market demand is projected to triple by the end of the decade with the electrification of transportation.
The state government bets on the initiative not only to transform one of the poorest regions in the country but also to contribute to global decarbonization and much more. With the intention of generating notoriety, the campaign was presented at Nasdaq headquarters in Times Square, New York.
The region has 45 lithium deposits in the northeastern part of the state, which could increase national production by more than 20 times, according to estimates from the state government.
The measure, besides generating a transformation in the region, also promises to bring legal security and aim for strict rules for environmental preservation.
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Chile, which has the largest proven lithium reserves and some of the lowest costs for obtaining the mineral, has just presented a new national policy for lithium exploration. The country will require state participation in future exploration projects, generating uncertainty among investors. Shares of the two companies producing lithium in the country plummeted over 20% the day after President Gabriel Boric’s announcement.
Minas Gerais Aims To Offer An Attractive Alternative For Investors And Make The Lithium Valley Competitive In Lithium Exploration.
Brazil is open to companies from all over the world. “We are convinced that the development of the mining sector does not disregard the private sector,” said Vitor Saback, national mining secretary of the Ministry of Mines and Energy.
Legal security is a key point in the government’s offer to attract investors. For just over a year, the state government has been working on the Lithium Valley campaign and now hopes that environmental licenses will be expedited with the presentation of the campaign.
The government’s objective is to enhance the Jequitinhonha Valley, demystifying mining, which is considered the most sensitive issue regarding the sector in Brazil, especially in Minas Gerais. “What doesn’t solve anyone’s life is for the mineral to remain eternally buried,” said the governor of Minas Gerais, Romeu Zema.
The Lithium Valley Campaign Did Not Present Many Details, But It Will Involve The Expediting Of Environmental Licenses And Also Studies For Possible Infrastructure Investments.
Objective criteria will also be prioritized to provide more security to investors. The campaign also provides a success example in the Lithium Valley. The company Sigma Lithium has just inaugurated its commercial lithium production in the region, after more than a decade studying the region’s potential and R$ 1.2 billion in investments.
The company is expected to ship its first load of 15,000 tons from the Port of Ilhéus later this month. “We will produce enough lithium for 617,000 electric cars [annually],” said CEO Ana Cabral-Gardner. With planned expansions in the coming years, the estimate is that this total will be tripled.
Sigma Lithium Claims To Be The World’s First Green Lithium Producer, With All Electricity Used In The Plant Coming From Renewable Sources.
All the water used is also 100% recycled in the lithium purification stage, which does not involve chemical agents. The tailings are stacked dry and then exported for the recovery of residual minerals, which have commercial value. Several other companies are conducting geological studies and wish to follow the same path as Sigma.
Although Chilean salt flats have a higher concentration of lithium and lower production costs for the mineral compared to the Lithium Valley, it is hoped that sustainability credentials will make the difference.
Environmental activists claim that the activity could interfere with water availability in a region that is already desert-like, which is one of the reasons Chile has reviewed its mineral exploration policy. Brazil, in turn, wants to contribute to global decarbonization and intends to do so with integrity, transparency, and predictability, says the national mining secretary of the Ministry of Mines and Energy.
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