Switzerland-based miner Lithium Argentina (LAR) expects direct lithium extraction (DLE) to reduce its production costs by nearly 14pc, chief executive Sam Pigott said.
LAR plans to expand its flagship Cauchari-Olaroz project in Argentina by 45,000 metric tonnes (t)/yr, bringing nameplate capacity to 85,000t/yr. Although there is no timeline for the whole project to materialize, the company will build an initial 10,000 t/yr DLE plant as part of that expansion by 2028, provided it gets approval from Argentinian and Chinese regulators.
Cauchari-Olaroz is operated by Exar, a joint venture between LAR and China's Ganfeng Lithium.
LAR expects all-in production costs at the expansion plant to hover around $5,000/t, down 13.8pc from the current $5,800/t. The decrease will mostly come from the incorporation of DLE, Pigott said, which will both reduce reagent costs and increase lithium recovery from brine.
On the reagents side, DLE eliminates the need to lime the brine and produces cleaner lithium chloride, reducing the number of downstream purification steps and, consequently, reagent consumption.
Liming involves adding calcium oxide or calcium hydroxide, commonly known as lime, to the brine to precipitate impurities such as magnesium. Lime is one of the main inputs in evaporation-based lithium production, meaning DLE can eliminate this cost component entirely.
DLE also achieves higher lithium recovery rates from brine. By producing more lithium from the same volume of brine, higher recoveries can lower unit production costs through improved process efficiency.
LAR expects regulatory approval from Argentina by year-end, while the company has less clarity on when a green light from Chinese regulators might come, though it expects a positive nod "early next year", Pigott said, noting that Ganfeng is leading discussions with China.
Output nearing designed capacity
Cauchari-Olaroz continued to produce close to nameplate capacity during the third quarter.
The project produced 9,550t between July-September, up 3pc from the previous quarter. With that, 2026 production hit 28,490t, putting LAR on track to reaching the midpoint of its full-year guidance of 35,000-40,000t.
Lithium Argentina reported net income of $13mn in the third quarter, reversing a $64.5mn loss a year earlier. The improvement was driven largely by the company's share of income from Cauchari-Olaroz, which rose to $16.8mn from a $52.5mn loss a year earlier as higher lithium carbonate prices and sales volumes lifted results. The year-earlier figure also included $26mn in previously unrecognized losses related to 2024.
