Item 1. Business
Item
1. Business.
Overview
Atlas
Lithium Corporation (“Atlas Lithium”, the “Company”, “we”, “us”, or “our”
refer to Atlas Lithium Corporation and its consolidated subsidiaries) is a mineral exploration and development company with lithium projects
and multiple lithium exploration properties. In addition, we own exploration properties in other battery minerals, including nickel,
copper, rare earths, graphite, and titanium. Our current focus is the development from exploration to active mining of our hard-rock
lithium project located in the state of Minas Gerais in Brazil at a well-known lithium-bearing pegmatitic district, which has been denominated
by the government of Minas Gerais as “Lithium Valley.” We intend to mine and then process our lithium-containing ore to produce
lithium concentrate (also known as spodumene concentrate), a key ingredient for the battery supply chain.
In
addition to our lithium exploration activities, we also own approximately 32.7% of the shares of common stock of Atlas Critical
Minerals Corporation (formerly known as Jupiter Gold Corporation) (OTCBQ: JUPGF), as of December 31, 2024. Atlas Critical Minerals
Corporation (“Atlas Critical Minerals”) is an exploration stage company focused on the exploration and development of
mineral rights relating to certain critical minerals such as rare earths, copper, graphite, nickel, iron, gold and quartzite. The
results of operations of Atlas Critical Minerals are consolidated in our financial statements under generally accepted accounting
principles in the U.S. (“U.S. GAAP”). On November 19, 2024, Atlas Critical Minerals consummated a merger with our
majority-owned subsidiary, Apollo Resources Corporation, with Atlas Critical Minerals continuing its corporate existence as the
surviving corporation (the “Merger”). For more information about the Merger, please see “ Note 7 – Related
Party Transactions—Merger of Atlas Critical Minerals Corporation and Apollo Resources Corporation .” On December 18,
we entered into an Option Agreement (as defined below) with Atlas Critical Minerals pursuant to which we sold an Option (as
defined below) to Atlas Critical Minerals to acquire 100% of the equity interests of our subsidiary, Brazil Minerals Resources
Corporation. For more information about the Option Agreement, please see “Item 2. Properties—Other Critical
Minerals. ”
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Minas
Gerais Lithium Project
Our
most material property at this time is the Minas Gerais Lithium Project (“MGLP”), which comprises 85 mineral rights
totaling approximately 468 km 2 . In particular, we are focused on the Neves Project (as defined below), which is a part of MGLP. The Neves Project is depicted in Figure 1.
Figure
1: Neves Project mineral rights.
We
are primarily focused on advancing and developing our hard-rock lithium project located in the state of Minas Gerais, Brazil.
Our Minas Gerais Lithium Project is currently our largest undertaking and primary focus. This project is located in northeastern Minas
Gerais, Brazil along the Eastern Brazilian Pegmatite Province (“EBP”) that extends more than 850 kilometers across eastern
Minas Gerais. The EBP has been surveyed by the Brazilian Geological Survey and is known for the presence of hard rock formations known
as pegmatites which contain lithium-bearing minerals such as spodumene and petalite. Pegmatites are igneous bodies derived during the
final stages of crystallization of a larger parent igneous intrusion, most commonly a granitic rock. They are distinctive for their very
coarse-grained crystalline texture, and in some instances, complex composition with unusual minerals and rare elements. Commercially
productive lithium mineralization along the EBP is centered around the Araçuaí mining district, which is host to the majority
of Brazil’s commercial lithium production and reported mineral reserves.
Because
of the region’s long mining history, basic local infrastructure near our mineral properties ranges from adequate to robust, with
access to hydroelectric power and water supplies, and a well-established road network with direct access to commercial ports. Basic goods
and services, industrial suppliers and a skilled and semi-skilled labor force are also generally available from the surrounding communities
where we operate.
Since
initiating exploration at MGLP in early 2021, we have confirmed the widespread presence of hard-rock lithium-bearing pegmatites across
our property portfolio.
We
believe that we can increase our value by continuing our exploration work and quantification of our lithium mineralization, as well as
by expanding our exploration campaign to new, high-potential areas within our portfolio of mineral rights. Our initial commercial goal
is to enter production of lithium concentrate, a product which is highly sought after in the battery supply chain.
We
are in the process of assembling our modular dense media separation (DMS) lithium processing plant in furtherance of our goals to
begin lithium production at our Neves Project. Our DMS processing plant was manufactured in South Africa. It was designed to produce
150,000 tons of lithium concentrate per annum (“tpa”). The manufacturing process of the DMS plant was concluded in the
end of 2024 and the plant was successfully shipped to Brazil. The shipment, consisting of 141 containers and 10 bulk items, departed
the Port of Durban, South Africa, on February 2, 2025, and arrived in Brazil, Port of Santos, on March 7, 2025.
Our
DMS plant represents a cornerstone of our Neves Project, and was designed to deliver high-quality lithium concentrate to the global
market for electric vehicles (EVs) and renewable energy storage systems (ESS). With worldwide lithium demand growing, we are positioned
to emerge as a key contributor to the sustainable energy transition. This milestone marks a significant step in our progression
toward becoming the next lithium producer in Brazil’s resource-rich Lithium Valley.
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Geology
The
EBP is considered to be one of the world’s largest geologic belts of granite and related pegmatite intrusive bodies, encompassing
more than 150,000 km 2 and with more than 90% of the belt located in eastern Minas Gerais. Pegmatites are igneous rocks that
form during the final stages of a granitic magma’s crystallization. They are readily identifiable by their exceptionally coarse
crystalline texture, with individual crystals averaging one centimeter or more in size. Most pegmatites have a simple mineral composition
common to granitic rocks, however some may also contain lithium minerals of commercial interest such as spodumene which can contain up to 3.73% Li (8.03% Li 2 O 2 ), and petalite
with up to 2.09% Li (4.50% Li 2 O 2 ).
The
MGLP area encompasses multiple areas of mineralized pegmatites, in general occurring as series of sub-parallel elongate tabular bodies,
referred to as ‘pegmatite dike swarms,’ hosted in metamorphic shists. Individual pegmatite bodies range from several meters
to more than 50 meters thick and from tens of meters up to approximately one kilometer in lateral strike length. They are primarily composed
of minerals such as quartz, feldspar and mica, with localized concentrations of spodumene and petalite. Individual feldspar and spodumene
crystals can reach up to two meters in length but typically are more homogeneously distributed and range in size from one to a few
centimeters in length.
Neves
Project
At
our Neves Project, the focus is on the delineation of the four confirmed pegmatite bodies with spodumene mineralization, designated as
Anitta 1 through 4. Complementing the four confirmed mineralized pegmatites are six new and promising target areas designated by our
geology team within our Neves Project.
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Figure
2: Neves Project location within Lithium Valley.
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Through
geological mapping and soil geochemistry work, six promising exploration targets have been identified within the Neves Project, as
shown in the map below.
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Raw
Materials
We
do not have any material dependence on any raw materials or raw material supplier. All of the raw materials that we need are available
from numerous suppliers and at market-driven prices.
Intellectual
Property
We do not own or license any intellectual property which we consider to
be material.
Government
Regulation
Mining
Regulation and Compliance
Mining
regulation in Brazil is carried out by the National Mining Agency (“ANM”), a federal entity with offices in each state in
Brazil. We are required to file for exploration licenses for each mineral right that we own with the ANM office of the state in which
such mineral right is located. The applications for such licenses must contain, among other things, a project for the exploration work
to be undertaken. If approved, we have three years (subject to extension to up to an additional three years) to conduct exploration activities
in accordance with the approved plan and prove the existence of the mineral and quantify a deposit. Once exploration is completed, ANM requires a final exploration report which, if approved, allows for the application of an extraction license. Extractions requests
require detailed economic viability studies. We have been issued exploration licenses for our key areas for lithium. We believe that
we maintain a good relationship with ANM.
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Environmental
Regulation and Compliance
Environmental
regulation in Brazil is carried out by state-level agencies, which may have multiple offices, including one for each region of the state.
For instance, in the state of Minas Gerais, the State Council of Environmental Policy, or COPAM, and the Regional Superintendencies of
the Environment, or SUPRAM, carry out environmental permitting and licensing processes. For each mineral right that we own, after sufficient
exploration work has been conducted, we can apply for operational permitting towards mining by filing any such paperwork with the local
office of the environmental agency that has the applicable geographical jurisdiction. We believe that we maintain a good relationship
with the offices of the environmental agency and believe that our methods of monitoring are adequate for our current needs.
On
June 21, 2023, the government of the state of Minas Gerais in Brazil provided us with written notice granting us priority status for
review of environmental permitting and licensing. This development followed the vote of the Economic Development Group
(“EDG”) of the Secretariat for Economic Development of the state of Minas Gerais during a meeting held on June 6, 2023,
approving the request that our Neves Project be analyzed by the Superintendence of Priority Projects, recently renamed as
“Diretoria Regional Geral” (Regional General Directorship). EDG determined that the environmental licensing process, the
analysis of which is necessary to determine the proper progress of our Neves Project, shall be considered a priority for the
development of the state of Minas Gerais because it obtained a high score according to a matrix of specific criteria. This
development meaningfully expedited the permitting and licensing of the Neves Project, resulting in the grant of
the operating license on October 26, 2024.
The
current environmental regulations state that for the duration of mining operations and for a period of five years after all mining operations
have ceased, we would still be required to perform any necessary recuperation work.
Environmental,
Social and Governance
We
are committed to Environmental, Social, and Corporate Governance (“ESG”) causes. We believe that our efforts make a difference
in the communities in which we operate. The list below highlights our recent initiatives to develop the communities in which we operate:
Support
with donations of machines and equipment for works carried out by local governments:
○ Use
of our water truck for the works to improve access to local communities;
○ Improvements
in the Neves community pavement;
○ Use
of our earth moving equipment for a mobile phone tower in the community of Neves;
○ Use
of our water truck for supplying communities and wetting roads;
○ Donation
of asphalt emulsion to improve main roads in Araçuaí;
Road
improvements and gravel:
○ Improving road access to a municipal school and the São José
das Neves community;
○ Improving
road access to Comunidade Cardoso´s hill;
○ Improving
road access to Neves Community;
Infrastructure
○ Construction
of accommodation for teachers at the Calhauzinho Community State School;
○ Construction
of the sidewalk, accessibility ramp, recreation yard and improvement of the canteen at the municipal school of the São
José das Neves community;
○ Construction
of the support house, kitchen and courtyard of the São José das Neves Community
Church;
○ Renovation
and painting of the São José das Neves Community Church in partnership with the outsourced company Eco
Sondagens;
○ Construction/revitalization
of 14 small water storage dams for local residents;
Professional
development
○ Developed
trainee plan for the inclusion of women students in the mining technician course;
○ Agreement
with Instituto Técnico Educacional Polivalente de Araçuaí-ITEP to offer
internship positions at Atlas to the institution’s best students;
○ o
Partnership with SESI/SENAI/FIEMG to offer technical and professional courses using rooms
on the 1st floor of our building in Araçuaí for face-to-face classes;
Our current efforts are focused on hiring workers from communities
near our project areas. Many of these communities have high levels of unemployment, and we believe that we are making a positive contribution
by hiring local personnel at wages that are above the regional monthly wages.
Form
and Year of Organization
We
were incorporated in the State of Nevada on December 15, 2011, under the name Flux Technologies, Corp. From inception until December
18, 2012, we were focused on the software business, which business was discontinued. We operated with the name “Brazil
Minerals, Inc.” until September 26, 2022, when we changed our name to “Atlas Lithium Corporation.” In January
2023, we completed a public offering of shares of our common stock and on January 10, 2023 began trading on the Nasdaq Capital
Market under the ticker symbol “ATLX.”
Legal
Proceedings
We
are not a party to any material legal proceedings.
Available
Information
We
maintain a website at www.atlas-lithium.com. We make available free of charge, through the Public Filings section of the Investors
tab on our website, our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments
to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, as soon as reasonably practicable after
such material is electronically filed with, or furnished to, the Securities and Exchange Commission (the “SEC”). The
information on our website is not, and shall not be deemed to be, a part hereof or incorporated into this or any of our other
filings with the SEC.
In
addition, the SEC maintains a website at www.sec.gov which contains reports, proxy and information statements filed electronically by
us with the SEC.
Employees
As
of the date of this Annual Report, we have 70 employees, out of which 60% are represented by a private federation of employees in
the extractive industries of the state of Minas Gerais. Representation by such an entity is mandatory for non-management workers in
the mining industry in Minas Gerais. We entered into the collective bargaining agreements adopted by the federation in March 2024,
which set forth standard working requirements and employee benefits. We maintain a good relationship with our
employees and the federation.
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