Sigma Lithium restarts Brazil operations after licences upheld

Federal appeal decision clears path for resumed production

Sigma Lithium Corporation (ASX:SAU) says it can resume full mining-industrial operations in Brazil after a Federal Court of Appeals upheld the validity of its environmental licences. The decision overturns the immediate constraint created by a local federal ruling and removes, for now, the most direct threat to production at the Grota do Cirilo project.

The announcement follows the company’s September operations suspension, which had placed its 330,000-tonne production target under pressure. Sigma says the appeal court granted emergency suspensive relief against the Teófilo Otoni ruling issued on 8 September, enabling operations to restart on the basis of what it describes as a technically grounded decision.

330,000-tonne target rests on existing plant capacity

Sigma has kept its year-end 2027 target of 330,000 tonnes of annualised lithium oxide concentrate production. It says the target does not require additional mine or processing capacity, relying instead on the South Pit, the Cleantech Industrial Plant and recycling and reprocessing circuits.

The company reported that the plant had previously produced more than 950 tonnes a day after a 2024 technology upgrade, with output exceeding 1,000 tonnes on several days. A fines and ultra-fines reprocessing circuit was completed in the first quarter of 2025. Those figures are company-reported operating benchmarks rather than a new production result, and the target remains exposed to operational, regulatory and market conditions.

Court weighs regional economic impact of licence dispute

According to Sigma, Senior Federal Judge Mônica Sifuentes found that a prolonged stoppage would create a significant and lasting economic impact in the Vale do Jequitinhonha. The company says its operations and associated programmes support about 19,000 direct and indirect jobs, linked to roughly 80,000 family members across 12 municipalities.

Sigma also points to reported GDP growth in Araçuaí and Itinga between 2021 and 2023, alongside initiatives covering water access, small-scale farming, women’s entrepreneurship and education. Those claims describe the company’s stated regional contribution; they do not remove the possibility of further legal or community challenges around the project’s environmental licensing.

Legal relief does not end the regulatory risk

The dispute arose from a case brought by Ngolo concerning alleged rights of Quilombola communities. Sigma rejects the basis of the challenge and says its operations do not sit within the newly claimed perimeter. The company also disputes reports linking the stoppage to geotechnical mitigation work at the North Pit, saying it does not operate that pit.

The ruling is therefore a material operational relief, but not necessarily the final word on the underlying licensing and community issues. Sigma’s ability to convert the restored legal position into steady production will be tested by the timing of the restart, future court action and actual output against the 2027 target.