GHANA has raised concerns that a sharp drop in global lithium prices may jeopardise its first lithium mining project in the south-central town of Ewoyaa, according to the head of the country’s mining regulator.
In October 2023, Ghana, a major West African producer of gold and cocoa, granted a 15-year lease to Australia-based miner Atlantic Lithium to develop the nation’s first lithium mine, with an expected launch by the fourth quarter of 2024.
Despite receiving environmental approval on Thursday, Atlantic Lithium has warned that delays in parliamentary ratification of the lease are hindering its ability to meet construction deadlines and secure better pricing.
Martin Ayisi, head of Ghana’s Minerals Commission, expressed concern over the viability of the Ewoyaa Project, which aims to produce around 360,000 tonnes of lithium annually. ‘It will cost Atlantic Lithium approximately $650 to produce a tonne of lithium concentrate, and with prices hovering just above $700, it’s a worrying situation,’ Reuters quoted Ayisi as saying. He cautioned that if the downward trend continues, the project could face further delays, much like other lithium ventures worldwide.
Lithium, a key component in batteries for electric vehicles, has seen its price plummet over the last two years due to oversupply and weaker-than-expected demand for electric vehicles. With emerging alternatives to lithium in the EV and battery sectors, Ayisi stressed that time was critical for the project’s success. ‘It’s not just a race against the falling price; it’s a race to mine while lithium remains in high commercial demand.
Atlantic Lithium’s general manager, Ahmed-Salim Adam, confirmed that the mine’s construction, initially set to begin in July, has now been pushed to the first quarter of 2025 due to the lack of parliamentary ratification. Lawmakers are delaying approval to allow for broader consultation, aiming to avoid past mistakes made in granting gold mining licences.
Adam also mentioned that the company still needs an operational permit from the mining regulator, a process that could take around 22 months to complete. He emphasised the urgency, saying, ‘We need quick ratification, or we risk losing investor confidence, especially when other regions like the lithium triangle and Mali are more attractive to investors.’
The future of Ghana’s first lithium project now hangs in the balance as officials navigate these critical challenges.
Credit: Reuters
