In addition, prior to official construction start, various aspects of site preparation had been advanced, including the drilling of fresh water bores and pumping station and the time consuming removal of scrubby vegetation, "tolar", from the area of the evaporation ponds prior to earth moving. Since then, numerous contracts with a total value of US$45m have been executed, or are ready for execution. These include the earth moving contracts for the construction of the 4.2 square kilometres of evaporation pond and road construction for the bore field access road across the salt lake (which will allow production bores to be drilled), the drilling contract for sixteen 200m production bores, purchase of 37km of pipeline for gas supply, and the establishment of the construction camp, fuel and water supply. All major contracts awarded to this point have been on or under budget.
Since start of official construction, and taking into account the Christmas break, significant progress has been made on-site as follows:
-- The establishment of the construction camp at Olaroz, and the renting of supplementary accommodation at the nearby town of Susques for first stage construction crews-- Mobilization of earth moving equipment and commencement of works-- The clearing of tolar over approximately 50% of the evaporation pond area (2 sq km) and the commencement of earth works for evaporation pond construction-- Establishment of a long term water supply to be used both for both domestic and construction purposes-- Establishment of fuel supply/storage and telecommunications-- The construction of 50% of the access roads on the salar to the bore - field area
Currently 142 construction workers are at site with a peak maximum expected of 400 by mid-2013.
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 unique community and shared value policy continues as a key success factor, training local people with supervision by high quality experienced professionals.
Salar de Cauchari Potassium-Lithium Project (Orocobre 85%)
On 22 October, the Company announced the completion of the maiden resource estimate at its 85% owned Cauchari lithium-potash properties ("Cauchari") in Jujuy Province, Argentina. Cauchari is located approximately 20km south of the Company's flagship Olaroz Project.
From October to December 2011 the company drilled five diamond and one rotary vertical drill holes in the Cauchari properties, followed by chemical analyses of the brine and porosity testing. This work provides the basis of the resource estimate, by independent consulting hydro geologist Murray Brooker, and other conclusions presented in the announcement.
Mr. Brooker has estimated an inferred resource in two adjoining areas of the salar, with a total 230 million cubic metres of brine at average grades of 380 mg/L lithium and 3700 mg/L potassium. This is equivalent to 470,000 tonnes of lithium carbonate and 1.6 million tonnes of potash (potassium chloride) based on 5.32 tonnes of lithium carbonate being equivalent to one tonne of lithium and 1.91 tonnes of potash being equivalent to one tonne of potassium. Details are given in the table below.
To view Table 1, please visit the following link: http://media3.marketwire.com/docs/850306_table_1.pdf.
