Brazilian court suspends Sigma Lithium mine licenses

Key facts

• A Brazilian judge suspended environmental licenses and mining activities at Sigma Lithium's Grota do Cirilo mine.
• The suspension is due to a civil suit alleging the mine impacts the Bau Quilombola community.
• The judge cited proximity of the Quilombola territory to the mining complex as a risk.
• Sigma Lithium claims it has not been notified of the ruling and continues operations.
• The company plans to initiate its legal defense.

A Brazilian judge has ordered the suspension of environmental licenses and mining activities at Sigma Lithium's Grota do Cirilo mine, a significant asset for the company. The ruling, issued on Friday, stems from a civil suit filed by the Federation of Quilombola Communities of Minas Gerais, which argued that the mining project encroached upon the territory of the Bau Quilombola community.

Judge Antonio Lucio Tulio de Oliveira Barbosa found sufficient evidence that the Bau territory falls within the project's area of influence, necessitating procedures such as free, prior, and informed consultation with the community. The judge expressed concern over potential harm, noting the mine's "constant blasting and earthmoving activities just a few kilometres from the traditional territory." Studies indicated the territory is approximately 2.7 km from the directly affected area, well within the 8 km threshold that triggers more extensive licensing requirements.

Sigma Lithium has maintained that its project lies outside the impact zone. The court has ordered an independent expert review to determine the precise distance between the project and the Quilombola territory. The decision not only suspends existing environmental licenses but also bars the Minas Gerais state from issuing new ones and imposes a fine on Sigma for continued operations.

In a statement on Monday, Sigma Lithium asserted that it continues to operate the mine and has not been officially notified of what it described as a "preliminary judicial ruling issued without due process." The company indicated it would commence its legal defense on Tuesday. The Grota do Cirilo mine is Sigma's sole productive asset, with a nameplate capacity of 330,000 tons of lithium oxide concentrate annually.