The expansion of lithium carbonate producer Lithium Argentina’s Cauchari-Olaroz lithium brine operation has been approved by an evaluation committee under Argentina’s Large Investment Incentive Regime (RIGI).

Cauchari-Olaroz is 44.8% owned by the company, 46.7% by Ganfeng and 8.5% by Argentina-owned mining investment company JEMSE.

The Stage 2 expansion targets production capacity of an additional 45 000 t/y of lithium carbonate equivalent (LCE), building on Cauchari-Olaroz’s Stage 1 operating capacity of 40 000 t/y.

The approval was announced by Argentina’s Minister of Economy Luis Caputo, following completion of the final technical evaluation under the RIGI review process, with the formal resolution expected in June.

“Securing RIGI approval is an important milestone in derisking the Stage 2 expansion at Cauchari-Olaroz. With Stage 1 performing well, the operation is generating strong cash flow and [is] well positioned to support this next phase of growth,” says CEO Sam Pigott.

“Argentina continues to provide a constructive backdrop for large-scale investment, reinforcing the strategic value of our asset base. This is reflected in the strong interest we are seeing at Pozuelos-Pastos Grandes from a broad global group of potential partners and customers focused on building a diversified and resilient supply chain of lithium chemicals – engagement that supports and further derisks our long-term growth strategy,” he adds.

RIGI is Argentina’s federal incentive regime for large-scale investments in strategic export industries, including lithium. The RIGI approval provides Cauchari-Olaroz’s Stage 2 with 30 years of foreign exchange regulation, fiscal and customs stability, among other benefits.

This includes an investment commitment of a minimum of $200-million in accountable assets, with at least $80-million deployed within the first two years from approval.

It also engenders legal certainty, with dispute resolution mechanisms and safeguards against regulatory changes.

There are also tax incentives, including a 25% corporate income tax rate (down from 35%), lower dividend/remittances withholding tax (50% reduction after seven years), accelerated depreciation and a beneficial value-added tax (VAT) regime (including issuing VAT credit certificates in lieu of payment in cash).

The company also highlights customs advantages, with duty-free import of approved capital goods for construction and operation, and exemption from duties to exports after three years since RIGI approval.

Lastly, in terms of foreign exchange, it provides the ability to retain export proceeds offshore and unrestricted access to hard currency for debt service and shareholder distributions.

The RIGI approval follows a series of key project advancements, including the updated mineral resource estimate at Cauchari-Olaroz announced in March, which the company believes demonstrates sufficient resource scale to support future expansion and the submission of the Stage 2 environmental permit application.

Lithium Argentina continues to advance Stage 2, which is expected to leverage the strong cash flow generated from the Stage 1 operation, reinforcing a disciplined and capital-efficient approach to growth, the company highlights.

Next steps to advance and derisk the project’s growth plan include Stage 2 permitting. The environmental permit application was submitted in December 2025, supported by the completion of a basin-wide hydrological resource model supporting Stage 2 production capacity.

In terms of the Stage 2 development plan, the technical and economic plans are advancing, with definitive development plan results expected in mid-2026.

Following receipt of environmental permits in November 2025 for the first phase, a RIGI application was submitted in early 2026 based on a three-phase development plan targeting total capacity of 150 000 t/y of LCE.

Lithium Argentina and Ganfeng continue to advance discussions with potential strategic partners regarding minority ownership interests.