Sigma Lithium jumps after Brazil court reopens mine

Sigma Lithium (Nasdaq, TSXV: SGML; ASX: SAU) shares rose as much as 6.7% in New York on Wednesday after a Brazilian appeals court upheld its environmental licences, clearing the company to resume mining and processing at its flagship Grota do Cirilo lithium operation.

The federal appeals court overturned an emergency order that shut the operation last week in connection with a lawsuit filed by Ngolo, an association claiming to represent local Quilombola communities.

Senior federal judge Mônica Sifuentes said a prolonged shutdown would cause lasting economic harm in the Vale do Jequitinhonha region of Minas Gerais state, according to Sigma.

The decision removes an immediate legal obstacle for Grota do Cirilo, among the world’s largest hard-rock lithium deposits, as Sigma works towards an annualized lithium oxide concentrate production rate of 330,000 tonnes by the end of 2027.

Capacity in place

Sigma said it can reach the 2027 target without adding processing capacity, relying on its existing Mine 1 South Pit and Cleantech Industrial Plant.

The plant demonstrated production of more than 950 tonnes of lithium oxide concentrate a day following a technological upgrade in the fourth quarter of 2024, Sigma said. Output exceeded 1,000 tonnes on several days.

The resumption shifts attention back to Sigma’s ability to increase production after the court dispute interrupted operations at its main asset. Reaching the planned rate with existing infrastructure could limit the additional capital required to meet its 2027 guidance.

Sigma shares were trading at about $9.85 in New York Wednesday afternoon, up 1.5% after reaching an intraday high of $10.36. The company had a market value of about $1.1 billion.