Lindian Resources Inks 10-Year Lease for Woula Bauxite, Set for Annual Royalties

Lindian Resources Ltd, an Australian-listed company specializing in high-grade bauxite exploration, has announced a binding agreement to enter a 10-year lease and operational rights arrangement for its Woula Bauxite Project in Guinea, West Africa. The deal, signed with local partners Enterprise Generale d’Entretien & Construction and Lancinet Dabo, will provide Lindian with a passive royalty stream, marking a significant milestone in the company’s strategy to monetize its bauxite assets without incurring capital expenses.

Under the terms of the agreement, Lindian will earn a royalty of between US$1 and US$2 per tonne of bauxite produced, depending on the ownership structure of the producing entity. The royalty payments will continue throughout the entire production period. Lindian plans to transfer ownership of the Woula leases to the lessees once they have produced 10 million tonnes of bauxite, or after a period of five years, whichever comes first. This arrangement is designed to provide Lindian with consistent cash flow over the long term while allowing it to retain strategic control over the lease until production targets are met.

The Woula Bauxite Project, located in Guinea’s prolific bauxite-producing region, is set to benefit from the expertise and experience of the lessees. They are actively working to secure the necessary exploitation licence, and early-stage project activities have already been initiated, including mine planning, site access preparations, and securing the requisite local permits. The granting of the exploitation licence is expected soon, at which point full-scale development of the project will commence. This development is vital, as Guinea is home to some of the largest and most lucrative bauxite reserves globally, and the project could serve as a key contributor to Lindian's long-term growth prospects.

A key benefit for Lindian in this agreement is the preferential access secured to port facilities in northern Guinea. This port access, which aligns with a consortium involving the lessees, will significantly enhance the company's ability to export bauxite to global markets. The lessees recently completed a feasibility study that was positively received by the Guinean government, leading to the approval of an independent export terminal in the Boké region. This terminal, designed to handle bauxite shipments efficiently, will provide Lindian with reliable access to logistics infrastructure for its future projects. Moreover, if the lessees secure port access for the Woula project or other related projects, Lindian will be granted priority access to any surplus terminal capacity.

Lindian Resources is also actively evaluating its other Guinea-based bauxite projects, Lelouma and Gaoual. The company is currently engaged in discussions with potential partners and investors to fund and advance the development of these projects. The strategic agreements secured with the lessees for Woula are expected to further boost the company’s credibility and attract additional investment for its other bauxite assets.

Asimwe Kabunga, Executive Chairman of Lindian Resources, emphasized the significance of the agreement, noting, "This binding lease and royalty agreement with a well-established Guinean company will deliver a meaningful passive royalty stream to Lindian." He added that the deal marks the first step in monetizing the company’s bauxite assets, providing an ongoing, capital-efficient revenue stream that can be reinvested into other growth opportunities.

The development of a dedicated bauxite export terminal in the Boké region, spearheaded by SIG Infrastructure, the lessees, and STS Group, will also address logistical hurdles associated with bauxite exportation. The port terminal is expected to have a handling capacity of 20 million tonnes per year, supported by state-of-the-art loading systems, barge piers, and extensive storage facilities. This infrastructure will be a critical factor in ensuring the long-term viability and success of the Woula project.

Lindian’s focus on strategic partnerships, infrastructure access, and efficient monetization of its bauxite assets positions the company for long-term success in the growing global bauxite market. With strong local partnerships, access to world-class port facilities, and a well-established royalty stream, Lindian Resources is poised to capitalize on the increasing global demand for bauxite, a key raw material for aluminum production. As the company advances its Guinea-based bauxite projects, it will continue to provide updates on the development and production milestones of the Woula Bauxite Project.