With a bigger focus on EVs, Mexico is taking some spotlight as the prolific Sonora Lithium project moves toward production. This week, Mexico Mining Review interviewed Peter Secker, CEO of the project operator Bacanora Lithium, who shared the features that first interested the company in the project and the next steps in financing and operations.


Q: Why did Bacanora Lithium choose Mexico to start its next lithium project?

A: We first came to Mexico over 12 years ago exploring for borates and other industrial minerals. As one of the main indicators of borate is lithium, we sampled a number of outcrops for lithium as well as borates. The lithium project in Sonora was sampled as part of a regional exploration program about nine years ago and was found to be rich in lithium and so became our priority exploration project in 2009. Over the past seven years we have continued to sample, drill and evaluate and we now have one of the biggest lithium deposits in the world.

Our experience of working in Mexico, especially in Sonora, has been extremely positive. The government has been supportive, as have the workforce and landowners. Infrastructure is good and there is a wealth of industrial support and skilled labor.

Q: What steps is the company taking to start production on the Sonora project?

A: We finished the bankable feasibility studies in December 2017 that outline the construction of the plant that will produce 17,500t/y of lithium carbonate. It will cost US$420 million to build the plant over 18 months. Processing at the plant is quite standard but we are trying to accelerate the development to be the next producer and we plan to start production by 2020. We have been working on this project for almost 10 years and operating our pilot plant over the last four years. It has taken us a long time to get to where we are.

Our pilot plant was created to demonstrate to our off-taker, Hanwa, and to our Japanese manufacturers that the quality of the material in Mexico is just as good or better than anything else in the world. Our goal is to continue producing high-quality material, at 99.5 percent quality, at low operating costs. The Sonora project has one of the lowest operating costs, which at US$4,000/t which makes us as competitive as the best mines in Chile. The company also differentiates itself by having an operating team in Hermosillo and an off-taker that is also an equity investor. It is one of the most advanced lithium projects in the world.

The Sonora Lithium project has completed its Environmental Impact Assessment and received CONAGUA water permits. Our plant design is based on best practice environmental standards.

Q: What financial model is the company using to finance the lithium project?

A: We are a public company, listed in London, with a strong shareholder base that includes BlackRock, M&G and our off-take partner Hanwa, each with a 10 percent shareholding. We plan to finance the project with a combination of debt and equity. The equity will come from our shareholders and debt from project finance banks. Lithium is quickly becoming more and more popular thanks to the steady growth of Asian demand. Currently some 95 percent of the world’s lithium batteries are manufactured in Asia.

We are currently the only lithium company listed on the London AIM market. Our shareholder base has always been very London-centric and this is where we see the biggest financial support. In the long term, we might consider joining the BMV but our focus is to start production first and grow our cash flow.


This is an exclusive preview of the 2019 edition of Mexico Mining Review. If you want to get all the information, plus other relevant insights regarding this industry, pre-order your copy Mexico Mining Review or access our digital copy of the 2018 edition.

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