Australian lithium developer Argosy Minerals [ASX:AGY] released an update on its flagship Rincon Lithium Project, saying the project is approaching the production stage.
AGY shares were down 6% in late afternoon trade on Thursday.
Despite today’s slump, AGY shares are up 115% over the past 12 months but down 30% from the 52-week high:
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October to bring lithium to Argosy
On Thursday, Argosy Minerals provided an update on the lithium operations at Rincon Lithium Project in Argentina.
AGY announced that 95% of the total work involved in developing the project’s 2,000tpa lithium carbonate production operation capacity is complete.
With three phases — design, construction, and commission — near completion and running according to AGY’s budgeting expectations, the company said it’s aiming for the first production of battery-grade lithium carbonate by October.
With the design phase complete, Argosy is now focusing on the construction side — site details such as the finalisation of utilities and accommodation and labs and office equipment are being sourced.
The commissioning is more than halfway complete, with the last of the raw materials, recruitment, and most of the plant and equipment testing still outstanding.
Once systems commissioning, final commission, and testing is complete, Argosy says the project will be able to progress to commercial production in the next quarter, after which operations will ramp up to 2,000tpa steady production.
Argosy’s Managing Director Jerko Zuvela stated:
‘The Company’s Puna operations team are conducting commissioning phase works whilst nearing completion of plant construction works and proceeding toward lithium carbonate production operations.
‘The Company is very excited with our progress to date and upcoming major milestones – becoming the next commercial scale lithium carbonate producer and transforming into a cashflow generator, leading to a significant near-term growth phase for the Company.
‘The lithium market continues its strong momentum with lithium carbonate prices forecast to continue around record highs into 2023 and beyond, resulting in very lucrative upcoming product sales revenues.’
AGY and overlooked lithium stocks
Argosy looks to be nearing commercial-scale production.
AGY said it’s aiming for ‘commercial scale operations’ during the next quarter — with a ‘ramp-up to 2,000tpa steady-state production operations to follow thereafter.’
Reaching production will soon be advantageous, as recent full-year results from Pilbara Minerals [ASX:PLS] have shown.
Lithium prices are strong — as is demand.
So it is interesting to see AGY shares selling down on Thursday. Are some investors taking profits as Argosy nears its production milestones?
Overlooked lithium stocks
Last year, junior lithium explorers Sayona [ASX:SYA] and Lake Resources [ASX:LKE] were two of the top performers on the All Ordinaries.
But younger lithium developers like Sayona and Lake are still quite a way off from production — which also makes them a while away from profitability.
Will market conditions look the same as they are now in two, three, or five years?
Or will prices reverse just as the likes of LKE and SYA start shipping out their lithium products?
And are there lithium stocks the market is overlooking right now?
According to Money Morning’s recent research report — yes.
To find out about these overlooked lithium stocks, click here.
Regards,
Kiryll Prakapenka,
For Money Morning
