Cadence Minerals plc has secured funding for international arbitration in connection with its investments in the Sonora lithium project in Sonora State, Mexico.
UK-MEXICO
The company holds a 30% stake, through its subsidiary REMML, in Mexilit S.A. de CV and Minera Megalit S.A. de CV, which hold the concessions.
Ganfeng Lithium Group Co., Ltd is the third partner and operator of the joint venture.
The move follows the Mexican Government’s amendments in 2022 and 2023 to its Mining Law, which banned lithium concessions and granted exclusive lithium mining rights to state-owned entities.
Cadence said it had secured funding from LCM Funding SG Pty Ltd, which had completed due diligence on the case.
The international arbitration is under the agreement between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of the United Mexican States for the Promotion and Reciprocal Protection of Investments (UK-Mexico BIT).
Chief executive officer Kiran Morzaria said of the funding: “This is an important milestone as it provides dedicated non-recourse funding to support the advancement of the claims.
“The measures that Mexico took against our interests in the Sonora lithium project breached the protections afforded to us under the UK-Mexico BIT.
“This funding materially strengthens our ability to pursue the arbitration in an appropriately resourced manner, while preserving balance sheet flexibility and supporting our objective of protecting shareholder value and seeking appropriate redress.”
Cadence’s main focus is on the Amapá iron ore mine project, in northeast Brazil.