Orocobre spikes on resource upgrade

Perth-based lithium play Orocobre's stock has jumped, after the company reported a fourfold increase in resources at its Olaroz lithium-potash project in Argentina.

Orocobre announced today that independent estimates by hydrogeologist John Houston had revealed a resource equivalent to 6.4 million tonnes of lithium carbonate and 19.3 million tons of potash at Olaroz.

Previous estimates put the Olaroz resources at 1.5 million tonnes of lithium carbonate.

At 9:51AM (WST) Orocobre's shares had risen 9 per cent, to trade at $2.78.

The company said it was currently in the final stages of a definitive feasibility study for Olaroz and expects it to be completed within the next few weeks.

Orocobre managing director Richard Seville said the company was "delighted" with the resources estimates.

"The grade of our resource, even using no grade cut-off, is high and reduces capital costs of ponds as less evaporation time is required," Mr Seville said.

"The large, broad surface area of the Olaroz salar, and consistently high grades at depth give us confidence that attractive grades will be maintained over time in a potential production scenario.

"These resource attributes, together with the quality of our data, which I believe gives a great deal of confidence in the results, clearly differentiate us from other projects."