(Ecofin Agency) - Leo Lithium announced last May the sale of its remaining stake in the Goulamina project in Mali to China's Ganfeng Lithium for $342.7 million.

The Malian government has allowed Leo Lithium to sell its remaining stake in Mali’s first lithium mine, the Goulamina mine. The stake was sold to Ganfeng Lithium, a Chinese firm. Lea Lithium revealed it obtained Bamako’s approval on June 14. 

"This is a positive step in the process of Leo Lithium's eventual withdrawal from the project," said Simon Hay, CEO of Leo Lithium. "While it would have been preferable for Leo to remain involved in Goulamina, we believe that in the absence of a viable agreement with the Malian government, this course of action is in the best interests of all stakeholders."

The sale is subject to the payment of capital gains tax, which applies to investors who dispose of movable or immovable assets. Leo Lithium claims to have paid $7.6 million when it finalized the $65 million sale of a 5% stake in Goulamina to Ganfeng in May. For the remainder of Leo's stake, the Australian company agreed to get $342.7 million from its Chinese partner. Mali will receive part.

The Chinese company will hold a 65% interest in Mali's first mine, once the transaction with Leo Lithium has been finalized. Per Mali's new mining code, Bamako has obtained a 30% stake in Goulamina, with a further 5% reserved for local investors.

Goulamina is expected to generate annual revenues of over CFA100 billion (around $163 million at current exchange rates), once it goes into production next August. Sales of up to 250 billion FCFA ($407.8 million) are also expected for Malian companies providing subcontracting services to the mine.

Emiliano Tossou