Galaxy, Orocobre affected by Argentina lockdown

Australian lithium companies Galaxy Resources and Orocobre have felt the impact of a nationwide lockdown on their Sal de Vida and Olaraz operations in Argentina.

The Government of Argentina issued the lockdown to contain the spread of the coronavirus, with mandatory quarantine restrictions imposed until March 31.

Galaxy demobilised its workforce at the Sal de Vida lithium and potash brine project, leaving only a skeleton crew to attend to essential services.

“The restrictions will inevitably slow down onsite activities, however offsite engineering work will continue unaffected,” Galaxy stated in an ASX announcement.

“Galaxy’s first priority is the health and safety of all employees, contractors and the wider community.”

To date, Galaxy has reached the pond lining and plant commissioning stage at the Sal de Vida pilot program.

Orocobre also transitioned the Olaraz lithium facility into care and maintenance, while the company continued to develop plans to recommence operations within a week once quarantine restrictions are lifted.

The company stated that these restrictions did not affect Orocobre’s mining operations or construction activities.

“Olaroz currently holds sufficient stock to meet customer orders until the end of April depending upon the recommencement of operations by customers in Asia and Europe,” Orocobre stated.

“Supply to customers will remain dependent upon the ability to transport and export product from the Olaroz sites to port in Argentina and/or Chile.”

Olaroz is in a comfortable financial position with approximately $US164 million ($283 million) in cash for corporate purposes.

This includes $US29.3 million which is set aside for stage two expansion of the Naraha lithium hydroxide plant in Japan, and $US11.1 million for Naraha’s debt facility.

Both Galaxy and Olaroz have continued to work with the national and provincial governments in Argentina for their ongoing response to coronavirus-induced lockdowns.

The companies will update the market as more information becomes available.

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