Highlights

• DFS highlights strong project fundamentals for flagship Salar de Olaroz lithium potash project
• Very large resource base to support long project life
• Low operating costs for battery grade lithium carbonate, low end of global cost curve
• High quality and conservatively derived results providing strong technical and commercial basis for project
• Pricing outlook for lithium and potash remains strong

The DFS provides a conservative initial production rate of 16,400 tonnes per annum of battery grade lithium carbonate production with an option to produce 10,000 tonnes of potash per annum two years after the start of lithium carbonate production.

The DFS highlights the Olaroz Project’s very low operating cash cost of US$1512 per tonne for battery grade lithium carbonate without a Potash credit. This cost estimate is competitive with existing brine producers and materially less than those reported by hard rock lithium minerals projects.

The engineering design and cost estimate for the definitive Feasibility Study was undertaken by Sinclair Knight Merz. The resource estimate and process design engineering was undertaken by Consulting Hydrogeologist, John Houston and Consulting Processing Engineer, Peter Ehren.

Orocobre will now work with partner Toyota Tsusho Corporation to finalise the Joint Venture Agreement and financing in order to progress the project to commercial production following receipt of final provincial government approvals.

Richard Seville Managing Director and Chief Executive Officer of Orocobre Ltd said he was delighted to announce DFS results that highlight the strong fundamentals of the Salar de Olaroz Project.”

“We are very pleased to announce our definitive Feasibility Study result that highlights the strong economic fundamentals of the Olaroz project,” Mr Seville said.

A production rate for the project of 16,400 tonnes per annum (tpa) of lithium carbonate has been developed taking into account what Orocobre believes is both conservative initial production rates from the salar aquifers and a realistic assessment of market uptake for lithium carbonate production in the stage one Olaroz development timeline. Associated potash production would be 10,000 tonnes per annum using the current non-optimised process route and mass balance.

Project Life

The DFS considers a 40 year project life. This results in cumulative production of 650,000 tonnes of lithium carbonate. This production rate, allowing for process recovery, is less than 14% of the current measured and indicated resource.

Under the terms of the agreement with Toyota Tsusho, in order to purchase its 25% equity interest in the Olaroz Project, Toyota Tsusho is obliged to arrange government guaranteed debt finance. Since March, with the impending completion of the DFS, the Company has been working closely with Toyota Tsusho and the relevant Japanese banking and government departments regarding the financing and associated due diligence processes. Based on these discussions, it is expected that the financing process will take approximately 9 months including final documentation. Earlier conditional approvals are likely which will facilitate earlier project development subject to provincial government approvals. Joint venture agreement negotiations with Toyota Tsusho will be undertaken concurrently.

Detailed engineering will be undertaken and engineering design and construction contractors will be selected during the same period together with order of long-lead time items. Bore field development will be undertaken once provincial government and conditional finance approvals have been received.

The construction period for the project is estimated at 15 months.