The Argosy Minerals Limited (ASX: AGY) share price is powering ahead today. This comes after the lithium miner provided an operational update at the Rincon lithium project.
The company holds a 77.5% interest in the Rincon project, located in Salta Province, Argentina. The mine is situated within the 'lithium triangle' – the world's dominant lithium production source.
At the time of writing, Argosy shares are fetching 32.5 cents apiece, up 8.33%.
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How is Argosy tracking along at Rincon?
The Argosy share price is surging after the company advised that 61% of construction works have been completed to bring the Rincon lithium project online. The development of the modular 2,000 tonnes per annum (tpa) of lithium carbonate production operation is currently on schedule and budget.
The company is aiming to achieve the first commercial production of lithium carbonate product from mid-2022.
Argosy noted that major works consisting of the design phase, site construction, and plant commission works have advanced. As such, Argosy provided a snapshot of the current progress:
- 99% of earthworks/land movements completed;
- 87% of site works completed (site camp/accommodation, laboratory and office, and other works);
- 100% of the brine system is now complete (pumping station and plant settling ponds);
- 57% of the process plant completed (plant equipment acquisition and plant warehouse); and
- 58% of utilities and associated services (vapour system, communication system and ancillary services).
Management noted current and recent construction works have concentrated on finalising a number of areas. This includes the accommodation camp facilities, building various industrial sheds, completing the brine system, building the on-site office and laboratory.
Furthermore, upcoming works will focus on plant and equipment delivery and installation, utilities and associated services supply and installation, and auxiliary systems installation. It is expected that significant progress will be made over the coming months.
Argosy hopes to increase the 2,000tpa of lithium carbonate to a 10,000tpa production target. It believes that with lithium prices rising along with tightening market supply and demand conditions, potential off-take arrangements will become more attractive.
Management commentary
Speaking about the development boosting the Argosy share price, managing director Jerko Zuvela said:
The company's Puna operations team are continuing their significant progress on construction and development works at our Rincon Lithium Project, as we head toward commencing the 2,000tpa lithium carbonate production operations.
The lithium market remains very positive and lithium carbonate prices are at record levels, which is providing great interest in our project and especially our product, noting our Rincon Lithium Project will become the next commercial production operation. Argosy's transformation into a cashflow generator is nearing, whilst also progressing toward the next stage 12,000tpa scale operations.
We look forward to a significant near-term growth phase from our operations this year and beyond.
About the Argosy share price
In the last 12 months, the Argosy share price has gained around 190%. However, it is flat this year to date.
On valuation grounds, Argosy has a market capitalisation of roughly $420.15 million, with 1.31 billion shares on issue.
