Lithium Argentina Returns to Profit and Seeks Partner to Invest US$4,500 Million

Lithium Argentina AG reported second-quarter results on August 11 confirming the consolidation of Cauchari-Olaroz, in Jujuy: the operation achieved a cash operating margin of 70%, according to Bloomberg Línea, and the company is planning to invest US$4,500 million in its next expansion phase with a third partner.

The return to profitability comes one year after Cauchari-Olaroz completed its ramp-up phase, with the company swinging to net income from a loss in the prior-year period. In the first half, the operation produced 18,944 metric tons of lithium carbonate, at approximately 95% of installed capacity, generating revenues of US$342 million, adjusted EBITDA of US$216 million, and net income of US$76 million, according to the report filed with the SEC on the same day. The realized price rose 16% between the first and second quarters, from US$16,818 to US$19,563 per metric ton. For the region, the signal matters because Argentine lithium feeds battery energy storage systems (BESS), virtual power plants (VPP), and electric vehicles being deployed across Latin America.

The growth plan is anchored in Cauchari-Olaroz Stage 2, approved in May under Argentina's Large Investment Incentive Regime (RIGI), which targets up to 45,000 additional metric tons of annual capacity, and in Pozuelos-Pastos Grandes, in Salta, which the company is developing alongside Ganfeng and for which it is awaiting the same approval. The operation reduced its net debt from US$256 million to US$142 million in three months, with free cash flow of US$141 million in the quarter, while cash costs fell to US$5,897 per metric ton from levels near US$8,000 during ramp-up. "The market has helped in recent months. There has been a price recovery," said Ignacio Celorrio, Vice President of Lithium Argentina, though he cautioned that the company does not assume current levels will hold.

The next milestone is the RIGI ruling for Pozuelos-Pastos Grandes, a 150,000-metric-ton project equivalent to Argentina's entire currently installed lithium capacity, which the company considers pivotal for the country's development. The entry of a third partner will determine how the US$4,500 million plan is financed.

This article was produced with artificial intelligence assistance from verified sources and reviewed by a human editor before publication.