Australia's Atlantic Lithium (LSE: ALL; ASX: A11) said on Friday that is engaged in talks with Ghana's state-owned Minerals Income Investment Fund (MIIF) for funding of up to US$30 million.
The exploration and development company is developing the Ewoyaa project in central Ghana, which would be the country's first lithium mine.
Atlantic says the operation, which is expected to begin production in the second half of 2024, has the potential to generate nearly US$5 billion in revenue over its 12.5-year life time.
The MIIF confirmed plans to take an equity stake in Atlantic Lithium and said the company had agreed to list on the Ghana Stock Exchange. Atlantic Lithium said only that discussions were ongoing, adding that there was no certainty an investment will be made.
A resource update for Ewoyaa, released early February, shows a resource estimate of 35.3 million tonnes at 1.25% lithium oxide (Li2O), including 28-million tonnes in the measured and indicated categories.
That 79% of the resource that now falls within the measured and indicated categories is made up of 3.5-million tonnes at 1.37% Li2O in the measured category and 24.5-million tonnes at 1.25% Li2O in the indicated category.
Ghana, known for its gold and cocoa production, has long sought to diversify its exports, and Atlantic Lithium, previously known as IronRidge Resources, believes that mining the battery metal could be a partial solution.
Prices for the ultra-light metal have surged about 10 times since the start of 2021 to almost US$80,000 per tonne, reflecting supply shortages and higher demand from the car industry.
IronRidge changed its name and spun out its gold assets into a separate company to focus on production of the battery metal, key for the batteries that power EVs and high tech devices.