Sigma Lithium appeals Brazilian court ruling as shares drop 15%

Sigma Lithium Corp. (NASDAQ: SGML) filed an appeal against a May 17 ruling by a local judge in Aracuai, Brazil, that ordered the company to face up to $10 million in collateral if it ultimately loses the case. The decision relates to allegations that the Grota do Cirilo lithium mine in the Vale do Jequitinhonha region disposed waste improperly, despite the company’s claim that the operation complies with Brazilian environmental regulations and uses dry‑stacked tailings, recycled water and renewable hydroelectric power.

The ruling sent Sigma’s shares down 12.25% at market close and a further 1.76% in pre‑market trading, wiping roughly 15% of the company’s market value. Sigma said the case follows a public hearing attended by more than 200 local residents and denounced a coordinated “fake news” campaign that it says is damaging its reputation. Earlier inspections had fined the firm for continuing to deposit material on a waste pile that had been ordered shut, and a partial rupture near a school was cited as evidence of structural concerns.

The appeal comes as Sigma pushes ahead with a stage‑two expansion that would raise annual output from 270,000 to 520,000 tonnes of lithium oxide concentrate, underscoring growing scrutiny of lithium projects in Latin America as governments and communities demand tighter environmental oversight while the market races to meet battery‑material demand.