Lithium Ionic Corp.'s (LTH:TSX.V; LTHCF:OTCQX; H3N:FSE) receipt of the requisite installation and operational license, or Licença Ambiental Concomitante (LAC), for its Bandeira lithium project in Brazil was delayed yet again, given the discussion on it scheduled for March 28 was dismissed, reported Greg Jones, BMO Capital Markets analyst, in an April 7 research note.
The LAC "would allow construction activities to commence," wrote Jones.
178% Potential Return
BMO reiterated its CA$2 per share target price on Lithium Ionic, noted the analyst. The Canadian explorer-developer is trading, in comparison, at CA$0.74 per share. From this price, the return to target is 170%.
Lithium Ionic is rated Outperform.
Timeline of Delays
Jones explained that originally, the mining company had expected to receive the LAC permit in early Q3/24 after having submitted the application for it in November 2023. The date was pushed out to Feb. 28 then March 28 and now is delayed further.
Early in February 2025, the Minas Gerais State Department of Environment and Sustainable Development (SEMAD) recommended approval, but some councilors asked for additional review. Lithium Ionic expected to receive the LAC on Feb. 28. That did not happen, and the Câmara de Atividades Minerárias (CMI), a key decision making body within SEMAD, was scheduled to discuss and approve Lithium Ionic's LAC permit on March 28. This, too, was put off so that further investigation could be done, Jones reported, based on information in decision notes from a March 28, 2025 meeting of the State Council of Environmental Policy (COPAM).
Why Another Delay
The reason for this latest delay, according to the media in Brazil, explained Jones, is to get answers to questions that have arisen about whether or not appropriate "free, prior and informed consultation was completed with the local Quilombola Bau community," as was required by State Decree No. 48.893/2024.
According to its February 2025 report, the State Environmental Foundation (FEAM) assessed Bandeira with respect to a consultation with the Quilombola Bau community and considered a technical note on the potential socioenvironmental impacts of the project. Given this review and along with the fact that the regulation had been rescinded in January, the foundation concluded that Lithium Ionic's Bandeira is exempt from the regulation.
Also, given the possible impacts on the community and other current legislation, FEAM recommended submission of a report on mitigation measures related to the Quilombola Bau community every February, to commence the year after the LAC is granted.
| Want to be the first to know about interesting Cobalt / Lithium / Manganese investment ideas? Sign up to receive the FREE Streetwise Reports' newsletter. | Subscribe |
