Vancouver-based Lithium Americas has increased the production forecast and budget for its Cauchari-Olaroz lithium brine project, in Argentina, announcing a definitive feasibility study (DFS) for a 40-year operation producing 40 000 t/y of lithium carbonate (Li₂CO₃).

Minera Exar – a 50:50 joint venture (JV) between Lithium Americas and China’s Jiangxi Ganfeng – owns the project, which is adjacent to Orocobre’s Olaroz facility.

Previously, the JV planned a 25 000 t/y operation at Cauchari-Olaroz that would have cost $425-million. The new study increased the capital cost by 33% to $565-million, but it supports a 60% increase in production capacity.

Lithium Americas said on Monday that construction capital costs included a contingency, and more than $200-million in capital already committed in contracts and purchase orders, of which $105-million in capital had been spent by June 30.

Assuming a lithium carbonate price of $12 000/t, the project has an after-tax net present value (NPV), at an 8% discount rate, of $1.78-billion. A $10 000/t price delivers a project with a NPV of $1 297/t.

With the recent decline in underlying prices of various lithium raw materials, including spodumene, lithium hydroxide and lithium carbonate, some companies have scaled back production plans.

Last week, Lithium Americas announced that it was contemplating a smaller Phase 1 operation at its Thacker Pass project, in Nevada. The company is studying production capacity of 20 000 t/y of battery-quality lithium carbonate-equivalent, compared with previously planned Phase 1 production of 30 000 t/y.

Meanwhile, with construction already under way at Cauchari-Olaroz and expected to be completed by the end of next year, the mine would deliver its first production in early 2021.

Lithium Americas said that the project was fully funded to production, with its share to be funded by $221-million available under credit and loan facilities, and the net proceeds from a $160-million project investment by Ganfeng Lithium.

The 40 000 t/y DFS increased the operating cost estimates to $3 576/t of Li₂CO₃, from $2 495/t, mainly owing to an $824/t increase in reagent costs, which reflects process changes designed to consistently achieve more stringent low impurity specifications of battery material customers.