Unlocking Ghana's lithium potential: Atlantic Lithium's path to sustainable growth

Unlocking Ghana’s lithium potential: Atlantic Lithium’s path to sustainable growth

Paul Sanger: We're talking today with Atlantic Lithium (ASX: A11). And it has a market cap of around $300 million. Atlantic Lithium is a lithium focus, exploration and development company advancing its flagship Ewoyaa Project in Ghana, West Africa to production. We welcome Atlantic Lithium Finance Director and Company Secretary, Amanda Harsas. Amanda, welcome to The Network.

Amanda Harsas: Thanks, Paul. Nice to be here.

Paul Sanger: Amanda, this is the first time that we've had Atlantic Lithium on The Network. Maybe you can give us a brief overview of the Atlantic Lithium business.

Amanda Harsas: So Atlantic Lithium is a explorer and developer in Africa. We have a flagship asset, the Ewoyaa Lithium Project in Ghana. It has a mineral resource of 35.3 million tons. We have strategic partners with Piedmont Lithium in the US and with the Ghana sovereign wealth fund who are funding and assisting us in bringing this project to development. It has excellent economics. We released our DFS back in June. It has life of mine revenues of $6.6 billion revenue based on a long-term average of $1,400 per ton. This is all US, by the way. And a net present value of $1.3 billion. So it's an excellent project, really good economics, and because where we are in Ghana on the coast, it means we have very low OpEx. It's a simple DMS process, so low CapEx and we'll be one of the lowest OpEx and CapEx projects globally.

Paul Sanger: So let's start, Amanda. Firstly, can you tell us more about the mining lease for the Ewoyaa Lithium Project and the impressive financial outputs the project is indicating?

Amanda Harsas: So we lodged out mining lease application around 12 months ago, and it went through the technical rigor of the Minerals Commission for about six months. And for six months, we've been working with the Ghana government to really align the Ghana Government's objectives around their electrification and being part of that global thematic, as well as ourselves in terms of being the number one partner in choice in Ghana. We have only drilled 3% of our tenure and we plan to explore through the rest of Ghana and increase our resource. So we both have objectives through this process and this mining lease that we got happen to really aligns with that between both of us.

Paul Sanger: Amanda, it's clear that Ghanaian government is highly supportive of the company's project. How important has the relationship been to delivering the project to this point?

Amanda Harsas: Look really important. So we've always been very supportive and had support from our local government area, our communities that are around us. We now have support regionally and centrally from the main government of Ghana. They, as I've said, have high strategic goals around lithium and diversifying out of gold. So they're the number one gold producer in Africa. So basically having that alignment now means that we are working together to create excellent space for both of us in country.

Paul Sanger: The sovereign wealth fund has now taken a 6% position in the project. What does this mean for the advancement of the project and for Atlantic Lithium?

Amanda Harsas: This is a strong guidance as to what's happening now. We can all see the M&A activity happening globally and the sovereign wealth fund of Ghana who basically collect the royalties and free carry interest profits from the gold producers and the other producers in Ghana basically wanted to invest in lithium, and this is a way for them to do a commercial strategic investment. And they took that up and we welcome them onto our register and it really aligns again, our interests and making us part of Ghana, we're a Ghanaian company are working for Ghanaians.

Paul Sanger: Piedmont has also shown itself to be highly supportive of the project. How important has their contribution been to date and what additional benefits can Piedmont provide going forward in terms of technical contributions?

Amanda Harsas: So Piedmont have been our strategic partner since 2021, so we all know that what happened through '19 and '20 around lithium. So having the financial reassurance from a strategic partner has been just really awesome for us really. And it's really created the position we're in now. We've been able to aggressively drill, do our studies and we've been funded through that. And Piedmont also provide the technical advice on our technical committee. So it's been really helpful and supportive to have that. We also have Patrick Brindle on our board who is the COO of Piedmont, and he's been an excellent addition to the board bringing his thoughtful advice around what we're doing as well. So it's been a really supportive relationship.

Paul Sanger: What's the current status of the drilling program and do you anticipate recent results will lead to resource upgrades? And how much further upside can you see from exploration?

Amanda Harsas: So this year we've got an 18,000 meter drill program and the results have been very good so far. We'll continue to have results coming out over the next few months. We've had good results on our infill exploration and extensional drilling, and we'll see that come through in the next little while. We've only drilled 3% and we really see that we will have a mineral resource upgrade based on what we've been doing. The more exciting thing for me as part of this negotiating with the government is we will be getting a lot of our applications that we've got in for further areas that we want to explore. And now that we have cashflow insight, we can then actually start aggressively exploring those areas. Some of them are highly perspective and that's really exciting for us as a company and it's been our strategic objective to do that.

Paul Sanger: And Amanda, I have to ask this, what's the stages of discussions, if any, that you've had with off-takers?

Amanda Harsas: So there's been many discussions. So obviously I'm the finance director, so it all gets directed to me. Recently we bought in one of the large investment banks to actually manage this process for us. I had, I'm going to say 30 to 40 off-takers in my emails and it just became too hard to manage and obviously we want to maximize what this can bring for the project as well. So that process is underway.
We will be in the top 10 global producers. First production's in 2025. The main plant will come on in 2026. So if you think about it, the next three to five years, and if you look at what's out there, there's not much feedstock coming into the market. So it's really exciting and lucrative for these producers and battery manufacturers and OEMs. Pretty much every supplier across the battery supply chain is interested.

Paul Sanger: And Amanda, what would you say to those that consider Ghana to be a risky investment perspective?

Amanda Harsas: Look, Ghana has got good rule of law. It's been a stable country for many years now. It's on the Fraser Index, it's in the top few of Africa to work in. It's above I think Victoria in that respect in terms of being able to produce in. Where we are we are on the coast. It's got excellent infrastructure. It's a number one gold miner. It is a great place to work and the people are friendly – we we have staff wanting to come and work for us. It's very easy to work in and very stable.

Paul Sanger: And Amanda, correct me if I'm wrong, Kamala Harris from the US was in Africa recently in Tanzania, but I also believe that she was in Ghana.

Amanda Harsas: Exactly. And we've got a US partner, Kamala came to Ghana as well. And the US are very interested now in coming into Africa. Obviously the critical minerals space across the globe the thematic is changing. Security of supply is also becoming prominence more so than in the past. So yeah, Kamala was there. I was there at the same time actually. We crossed over on the road. Didn't quite see her in person, but yeah, no. I did see the flags waving as they went past.

Paul Sanger: And look to finish up, how well positioned is the company to fund the development of the project?

Amanda Harsas: Look, we are really well positioned. We obviously have the offtake process underway that will basically hopefully get a prepayment that's our ideal choice. Because of our funding partners with Piedmont and MIF, because they've got a contributing 6% interest, the need we have is around US$40 million. That will more than be covered by the offtake. So I believe we're in a strong position. It's a good position to be in, to be a near term producer where your funding is sorted, basically.

Paul Sanger: Amanda, many thanks for your time today.

Amanda Harsas: No worries. Thank you. Nice to see you.