The Cabinet of Ministers unveils the terms of the tender for Dobra lithium deposit

The Cabinet of Ministers approved terms of the competition to conclude a production sharing agreement for solid minerals in respect of Dobra lithium deposit in Kirovograd region. The relevant resolution of August 27 was published on the government's website.

This project may become the debut for the U.S.-Ukraine Reconstruction Investment Fund, established under the minerals agreement, the Prime Minister said earlier Yulia Sviridenko.

The tender procedure is set forth in Article 7 of the Law of Ukraine "On Production Sharing Agreements" and the Law on ratification of the resource agreement with the United States.

The competition is open to citizens of Ukraine, foreigners, stateless persons, legal entities of Ukraine or other countries, associations of legal entities established in Ukraine or abroad, acting separately or jointly.

Participants must have adequate financial, economic, and technical resources, as well as experience. The evaluation is based on nine criteria with a total maximum weight of 100 points. The highest weight will be given to:

→ proposals for the distribution of products in favor of the state and additional proposals (e.g., payment of a bonus) – 30 points;
→ program of works on the subsoil area (the most comprehensive and rational conditions for the use of resources) – 20 points;
→ experience in prospecting, mining and processing of metal minerals (including lithium-containing minerals) – 16 points;
→ the level of financial support for the work program is 10 points.

The sum of the scores for all criteria is the basis for determining the winner.

Dobra field is located in Kirovograd region on the area of 1706.9 hectares. It includes weathered crustal rocks of the crystalline basement and rocks of the crystalline basement to a depth of 1000 meters. Mineral resources: lithium, niobium, tin, rubidium, tantalum, cesium, beryllium, tungsten, gold.

The winner of the tender receives a special permit for the use of subsoil for geological exploration, pilot development and further production for the duration of the agreement.

The investor's mandatory work program should include:

→ geological study of subsoil and international audit of reserves (within 2.5 years);
→ report to the State Information Geological Fund of Ukraine;
→ submitting materials on the assessment of lithium and other metal minerals reserves to the State Commission for Reserves of Ukraine;
→ environmental impact assessment.

In case of commercial feasibility, a decision should be made within six months to proceed to the primary processing of lithium-containing minerals and other metal minerals.

In case of a positive decision, mining and enrichment operations in a volume not less than the declared volume must continue for five years. In case of a negative decision, the special permit must be returned and the agreement terminated.

The minimum investment amount should be:

→ at least $12 million for geological exploration;
→ at least $167 million for the organization of mining and enrichment.

The amount of total investment is determined based on the results of the tender.

The state owns all the production before distribution, and the maximum share of compensation production (to reimburse the investor's costs) is 70% of the total production.

The state's share in profitable products should be equal to one percent:

→ not less than 4% in case of excess of accounting expenses over the cost of marginal compensation products;
→ not less than 6% in case of excess of the marginal compensation output over accounting expenses.

The Agreement is concluded for a period of 50 years from the date of signing, unless otherwise agreed.

A fee of UAH 500,000 is charged for participation in the tender to the registration account of the Ministry of Economy. The fee for a successful tender is non-refundable. If the tender is recognized as not having taken place, the fee is refunded in full.

The tender shall be deemed to have failed if:

→ no applications for participation were submitted by the deadline;
→ none of the submitted applications meets the terms of the competition;
→ The Cabinet of Ministers did not select the winner within three months of the deadline for submitting applications.

• Interest in lithium mining in Ukraine confirmed by techMet, a company registered in Ireland. TechMet's investment partner is billionaire Ronald Lauder, the son of Estée and Joseph Lauder, founders of the cosmetics company Estée Lauder.
• Lauder is a sponsor of the Republican Party and a friend of US President Donald Trump.