Sigma Lithium Corporation, a leading global lithium producer dedicated to powering the next generation of electric vehicles with carbon neutral, socially and environmentally sustainable chemical-grade lithium concentrate, categorically states that its Phase 2 & 3 expansion plans are proceeding as planned.
Sigma Lithium vehemently denies inaccurate recent media reports that incorrectly denominated as an “injunction” certain conditions established upon the approval by the Brazilian Courts of the transfer by RIX Mineração S.A. (“RIX“) to Sigma Brazil of two sub-divisions of an exploration permit (“Exploration Sub-Plots“).
The Brazilian Courts authorized the transfer of the Exploration Sub-Plots by RIX without cost to Sigma Brazil or Sigma Lithium.
- Furthermore, the Brazilian Courts ruled that any undue loss to RIX can be resolved through financial compensation amongst RIX shareholders.
- This compensation is an internal matter related to RIX and does not impact Sigma Brazil or Sigma Lithium.
Sigma Lithium states as categorically incorrect recent media reports speculating that the status or conditions attached to the transfer are impediments to the Company’s future operations and its ability to conduct its Phase 2 & 3 expansion.
Sigma Lithium believes the decision by the courts approving the transfer of the Exploration Sub-Plots by RIX with certain conditions was fair. The conditions are in line with the provisions within the Brazilian Mining Law. RIX did not appeal the Brazilian Courts decision.
Both Sigma Brazil and RIX access to the small areas represented by the two Exploration Sub-Plots is regulated by the Brazilian Mining Law through a standard “waste sharing agreement“.
- The two companies celebrated an irrevocably binding waste sharing agreement on August 9, 2023 ensuring access of both companies to the areas.
- Sigma Brazil is authorized to remove waste from the Exploration Sub-Plots in question, when opening its Phase 2 & 3 pits.
- In the event of Sigma Brazil encounters any mineral in the Exploration Sub-Plots, it shall place in a nearby location determined by RIX for its future use.
Paula Lacava, Sigma Lithium Chief Legal Counsel stated, “Approving the transfer with conditions was a wise decision by the Brazilian Courts, ruling in line with the Brazilian Mining Law: Not only validated the transfer, but also solved the matter of whether the Exploration Sub-Plots might contain economically mineable ore.”
The conditions established by the Courts allow Sigma Brazil to remove waste and ground within the areas of the Exploration Sub-Plots, as planned, in line with the standard “waste sharing agreement” signed. The conditions just reinforced the regulations in the Brazilian Mining Code:
(i) Sigma Brazil is just prevented from sub-leasing the “Exploration Sub-Plots” to a third party and/or;
(ii) Profiting from the sale of mineral ore located in the “Exploration Sub-Plots”.
Therefore, these conditions are not material nor impact Sigma Lithium´s business or Sigma Brazil´s operations.
The Exploration Sub-Plots do not contain any mineral reserves. The surface farms over the Exploration Sub-Plots are held by private Brazilian land corporations, Miazga and Arqueana, both also related parties, 51% controlled by Ana Cabral.
Hence the decision by the Brazilian Courts was not appealed by RIX or by Calvyn Gardner, a minority shareholder of RIX.
Sigma Lithium continues its strategic review of proposals received from potential partners in various industries globally.
Sigma Lithium’s Phase 2 & 3 mines are clear separate ore bodies from RIX’s deposits, as determined by the vertical section at the border limit. Therefore, the mining activities of both Phase 2 & 3 are ensured and regulated by rule of law (Mining Code and Federal Laws regulating the Mining Code), including access guarantees.
RIX is a related party to Sigma Lithium. It is a Brazilian privately held holding corporation founded by Ana Cabral in March 2009 and funded with her principal capital since inception. She controls 51% of RIX and granted Calvyn Gardner 49% as an “earned free carry” for his work as an executive in the Company.