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Orocobre Limited (ASX:ORE) (TSE:ORL) ("Orocobre" or "the Company") is pleased to advise progress on the construction and commissioning at its flagship Olaroz Lithium Project. In terms of physical progress the construction program is now nearing completion with the commissioning of circuits occurring as they are released from construction. The project is expected to be completed on budget.
Construction Activities
Key construction activities in the lithium carbonate plant in recent times have been the mounting of carbon steel and stainless steel pipework, the installation of air compressors, tanks and air treatment, the assembly and installation of the Bepex micronizing equipment and fitment of heating ducts and air supply.
As previously advised in the Company's last construction update, the Company has been assisting some construction contractors with the procurement and importation of some materials. One of these materials has been PVDF* piping which was being sourced from Europe. Unfortunately, in spite of the Company's assistance, this piping arrived later than scheduled causing minor delay in the completion of the piping on a number of circuits and the hand-over from construction to commissioning. Consequently, the expected time for the lithium plant to be operational, including purification and micronizing circuits, has been delayed by approximately three weeks with the plant scheduled to be operational in the second week of November.
*Polyvinylidene Fluoride (PVDF) is a unique thermoplastic with properties which allow it to be used for very aggressive or highly specialised applications. Although expensive compared to other thermoplastics, PVDF offers an economically attractive alternative to many "exotic" materials in process lines where limited working life of other materials necessitates frequent replacement.
Commissioning and Production
Commissioning of the soda ash system, air compressors, industrial water supply and reverse osmosis plant, brine pumps to the carbonate plant, boilers and process tanks is in progress or has been completed.
The gas fired electricity generation plant commissioned in July continues to operate smoothly and provide all the power requirements. The liming plant, which is used to treat brine to remove magnesium, is operating in automatic mode at a rate of 230l/s compared to a design rate of 200l/s and is expected to reach a rate of 250 l/s over coming weeks. Pond filling from the bore field is operating at 200l/s compared to a design rate of 180l/s and is expected to peak at more than 230l/s with the commissioning in October of a final bore.
The Company continues to follow the community and shared value policy to successfully work with suppliers and the employment bureau to focus on the hiring of local people from the communities of Olaroz, Huancar, Puesto Sey, Pastos Chicos, Catua, Susques, Jama, El Toro, Coranzulí, San Juan and Abrapampa. The project implementation is through EPCM (Engineering, Procurement and Construction Management) with a high proportion of local involvement through construction and supply contracts and local employment. The community and shared value policy continues to be a key success factor, training local people under the supervision of high quality experienced professionals.
The Olaroz lithium project is being developed by Orocobre (66.5%) with partners Toyota Tsusho Corporation ("TTC") (25%) and the Jujuy Province mining and energy company, JEMSE (8.5%) with a construction budget of US$229m including contingency.
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