Lithium Argentina, a mining company with operations in Jujuy and development projects in Salta, in Argentina, announced its second-quarter results this Tuesday, highlighting significant progress in its Cauchari-Olaroz operation.
By Panorama Minero
Sam Pigott, the company's President and CEO, expressed satisfaction with the progress of the plant's startup, stating that the operation has consistently reached 70% of its design capacity, with record monthly production levels over the past three months. "We are prioritizing maintaining consistent production volumes at these higher rates, which should continue to reduce costs," Pigott said. He also noted that these operational efforts, along with effective cost management, optimized working capital, and a strong financial position, will be crucial to ensuring the company's present and future success.
Pigott also praised the teams in Argentina and North America, whose dedication and expertise have been key to achieving the company's goals and efficiently overcoming challenges. Additionally, he emphasized that the improving financial landscape in Argentina and the country’s efforts to encourage foreign investment provide a favorable environment for continuing to increase the capacity of the Cauchari-Olaroz plant, which aims to become one of the world's largest sources of lithium carbonate.
During the second quarter of 2024, the Cauchari-Olaroz plant produced approximately 5,600 tons of lithium carbonate, representing a 24% increase over the first quarter. The operation is currently running at 70% of its design capacity, which is 40,000 tons annually, occasionally exceeding this level. The company maintains its production forecast for 2024 in the range of 20,000 to 25,000 tons of lithium carbonate.
During this ramp-up phase, production has been primarily sold to Ganfeng Lithium, their project partner. The quality of the lithium carbonate produced during the second quarter averaged 99.5%, and processing costs are expected to decrease as quality improves.
"Despite the current pricing environment, Cauchari-Olaroz is expected to remain cash flow positive in terms of operating cash flow, adjusted for changes in working capital. Unit costs should decrease as production volumes increase and the plant approaches its nominal continuous operation capacity."
Financially, as of June 30, 2024, Lithium Argentina had $96 million in cash and equivalents, along with an unused $75 million credit line with Ganfeng. Regarding the financial situation of Minera Exar S.A., its local subsidiary, the company reported total debt of approximately $315 million at the official exchange rate, or approximately $230 million at the current market exchange rate.
To reduce leverage in Exar, the company plans to use part of the $70 million from the Pastos Grandes transaction, along with contributions from Ganfeng, providing over $100 million in additional liquidity. "We are also exploring long-term financing options to replace short-term debt at Exar," the company concluded.
Join our mining community!
Subscribe to our newsletter for exclusive news, insights, and updates on the mining industry and Panorama Minero's latest initiatives.
Argentina Lithium & Energy Secures Major Lithium Properties in Argentina
The Canadian company, a member of the Grosso Group, has successfully completed the exercise of option agreements for nearly 25,400 hectares of lithium-rich land across its Rincon West, Pocitos, and Antofalla North Projects, in Argentina. This strategic move underscores the Company’s commitment to expanding its lithium portfolio in the region.
Argentine Economy: All You Need to Know About the Large Investment Incentive Regime
The recently approved Law 27,742 includes 65 articles aimed at providing incentives and guarantees to foster and attract private investments in projects that contribute to the development of the local economy.
Salta: AbraSilver Completes Environmental Impact Assessment for the Diablillos Project
AbraSilver Resource Corp. announced the completion of the Environmental Impact Assessment (EIA) for its silver and gold Diablillos project, located in Salta. The conclusion of this assessment marks a crucial step towards the development phase of the project, which is expected to achieve positive outcomes in water use, environmental impact, and socio-economic benefits.
Connectivity in Truck Cargo Transport: A Driver for Efficiency in Latin America and Argentina
Digital platforms that enable real-time fleet management and route optimization are revolutionizing the transport sector at a rapid pace.
Lithium: Galan Announces Agreement with Chemphys for the Hombre Muerto West Project
The Australian company, Galan Lithium Limited, announced the signing of a memorandum of understanding (MoU) for an offtake prepayment with Chengdu Chemphys Chemical Industry Co., related to the production of lithium products from the Hombre Muerto West (HMW) project, located in Catamarca, Argentina.
Japan Shows Interest in San Juan's Mining Potential
San Juan's mining sector has captured the attention of major Japanese companies seeking to explore new investment opportunities in Argentina.
Santa Cruz: Cerrado Gold Initiates New Exploration at Don Nicolás Mine, Aiming to Extend Mine Life Beyond Five Years
The company that owns the gold mine has announced the start of a new exploration campaign in Santa Cruz, with the goal of extending the mine's life and increasing mineral resources.
Top Destinations for Argentina's Mining Exports in H1 2024
Argentina's mineral exports totaled USD 1.86 billion in the first six months of the year, with mining accounting for 4.8% of the country’s total exports in June and 5.1% in the year-to-date. Based on these figures, the National Mining Secretariat reported on the destinations for minerals produced within the country.
The Strategic Potential of Centralization in Latin American Mining
The centralization of suppliers in mining operations drives efficiency through inventory optimization, reduction of indirect costs, centralized purchasing, traceability, and risk management.
Santa Cruz: “Mining represents 80% of the province’s total exports”
Nadia Ricci, head of the Santa Cruz Provincial Secretariat of Mining, highlighted the significant contribution of the precious metals sector in exports, employment, and local development.
Salta: AbraSilver Announces Significant Results from Drilling Program at Diablillos Project
AbraSilver Resource Corp. reported the assay results from its fully-funded 20,000-metre Phase IV drill program at its Diablillos project in Argentina. The latest drill results highlight the potential for expanding mineralization in the southern and western extensions of the JAC deposit, outside the conceptual open pit boundary.
San Juan Officializes Its Adherence to the RIGI and Seeks Investments for Mining and Major Industries
The San Juan Chamber of Deputies has approved the province's adherence to the Regime of Incentives for Large Investments (RIGI), a program promoted by the national government. Governor Marcelo Orrego welcomed the initiative, emphasizing that this adherence will open new opportunities for development and progress in the province. "San Juan's adherence to the RIGI is excellent news. It opens a great door to development, work, and progress. I congratulate and thank the legislators who prioritized the welfare of the province and our people," Orrego stated.