Lithium Argentina Cauchari-Olaroz expansion moves ahead despite 3Q loss

Cauchari-Olaroz

Lithium Argentina Cauchari-Olaroz expansion remains firmly on track even as the company posts a 3Q net loss. The flagship brine project delivered 8,300t LCE in the quarter and keeps guidance of around 32,000t for 2025. However, currency impacts and legacy financing costs pushed Lithium Argentina to a $64.5mn loss, underlining the financial volatility around the Cauchari-Olaroz expansion.

Strong production, weak pricing pressure margins

Cauchari-Olaroz remains one of Argentina’s largest single lithium projects and is running at about 80pc of capacity. The project has produced 24,000t LCE over January-September, 22pc higher than a year earlier, confirming the operational strength behind the Lithium Argentina Cauchari-Olaroz expansion. However, average realized prices of $7,522/t for lithium carbonate limit cash flow compared with the 2022 price peak.

Lithium Argentina holds a 44.8pc economic interest in the project via its Minera Exar joint venture with Ganfeng Lithium. As a result, its attributable revenue from Cauchari-Olaroz reached only about $26.4mn in the third quarter. Currency fluctuations and the conversion of earlier loans to Minera Exar into equity added more than $78mn in accounting losses, overshadowing solid operating metrics from the Cauchari-Olaroz expansion.

Rigi incentives key for PPG and next growth wave

The company’s growth strategy now hinges on securing Argentina’s Rigi incentives for large investments. LAR and Ganfeng plan to use the regime to support both the Lithium Argentina Cauchari-Olaroz expansion and the much larger Pozuelos-Pastos Grandes (PPG) cluster. PPG could reach 150,000t/yr LCE at full ramp-up, making it one of the biggest planned lithium brine platforms in the country.

The Rigi framework offers reduced taxes and royalties, streamlined customs, accounting flexibility and 40-year legal stability. Therefore, successful approval would materially improve project economics and risk perception for lenders and strategic offtakers. LAR aims to file a Rigi application for PPG in the first half of 2026, while a separate Rigi process for the Cauchari-Olaroz expansion is also in preparation.

The Metalnomist Commentary

Lithium Argentina is demonstrating that scale and uptime at Cauchari-Olaroz can offset some of the pain from lower prices and FX swings. The crucial question is how quickly Rigi incentives are granted, because these terms will shape funding costs for both Cauchari-Olaroz and PPG. For investors and cathode buyers, Argentina’s policy execution will help determine whether this emerging lithium hub meets its aggressive capacity targets.