PERTH (miningweekly.com) – Lithium miner Orocobre has reported record sales volumes from its Olaroz lithium facility, in Argentina, for the December quarter, while costs have declined to near all-time lows.

Production during the December quarter reached 3 727 t, up 58% quarter-on-quarter, as Orocobre responded to increased demand and reflecting the ongoing plant stability and improved operating practices.

Orocobre told shareholders on Wednesday that brine concentration remained at higher levels than in recent years, resulting in higher daily production rates, higher plant recoveries and further decreases in cost, despite Covid-19-related costs.

Sales volumes for the quarter were up 28% over the same period, to a new record 4 345 t, while sales revenue was up 57% quarter-on-quarter to $16.5-million as the average realised price improved by 22%.

Cash costs for the quarter reached $3 623/t, down 9% on the previous quarter, excluding an export tax of $85/t. The cash costs included all additional costs incurred as a result of the Covid-19 restrictions and a $360 000 non-recurring Covid-19-related wage subsidy from the Argentine government. Orocobre noted that excluding the subsidies, the cost of sales remained the lowest level for more than three years.

Meanwhile, the company told shareholders that the Covid pandemic continued to impact work on the Stage 2 expansion of the Olaroz project, with construction work now some 50% completed.

Following a review of the expansion work, the Stage 2 operation is now expected to start production in the second half of 2022, ramping up over a two-year period to full capacity of 25 000 t/y of primary grade lithium carbonate by the second half of 2024.

A scoping study for a Stage 3 expansion of the Olaroz project is expected to start in the March quarter, and will investigate options for additional production of between 25 000 t/y and 50 000 t/y from Olaroz, Cauchari or a combination of both, leveraging off the existing infrastructure.