Ghana is worried that a decline in global lithium prices could jeopardize its first lithium mining project in Ewoyaa, located in the south-central region of the country, according to the head of the country’s mining regulator.
In October 2023, Ghana, known for its gold and cocoa production, awarded a 15-year lease to Australia-based Atlantic Lithium to develop the nation’s inaugural lithium mine, with operations expected to begin by the fourth quarter of 2024, Reuters reported.
However, delays in parliamentary ratification of the lease are hindering its ability to meet construction timelines and secure favorable prices.
Martin Ayisi, head of Ghana’s Minerals Commission, expressed concerns that the Ewoyaa Project, which aims to produce around 360,000 tons of lithium annually, faces the risk of being halted due to these setbacks.
“It will cost Atlantic lithium around $650 to produce a ton of lithium concentrate, and with the price just above $700, it’s worrying for us,” he said, adding that if the downturn continues, the project may get delayed further like other lithium projects globally.
The price of lithium, crucial for electric vehicle (EV) batteries, has plummeted over the last two years as an increase in supply coincided with lower-than-expected demand for EVs.
With emerging alternatives to lithium in the EV and battery sectors, Martin Ayisi stressed that time is of the essence for Ghana’s Ewoyaa Project to remain profitable and competitive. Delays in the project could jeopardize its success as market dynamics shift.
“It’s not just a race against the price; it’s a race to mine at a time lithium is commercially needed.”
Ahmed-Salim Adam, general manager of Atlantic Lithium, informed Reuters that the construction of Ghana’s first lithium mine, initially set for July, has now been delayed until the first quarter of 2025 due to a lack of parliamentary ratification.
Lawmakers postponed the ratification to allow for broader consultations, seeking to avoid mistakes made during approvals for previous gold mining projects. Adam also noted that the company requires an operational permit from the sector regulator before construction can begin, which is expected to take around 22 months to complete.
