Orocobre Limited: Quarterly Report of Operations for the Period Ended 30 September 2013

Orocobre Limited (TSX:ORL)(ASX:ORE)

HIGHLIGHTS

Olaroz Lithium-Potash-Boron Project:



--  Construction of the project is proceeding on time and within budget. 
--  A total of US$133m has been spent or committed via executed contracts on
    the construction project to date. 
--  First brine was pumped in August (4 weeks ahead of schedule). 



Borax Argentina



--  The project to relocate the borax chemical plant from its current
    location in Campo Quijano (close to the city of Salta) to the Tincalayu
    mine is progressing on schedule and within budget. The relocation and
    commissioning is planned to be completed by June 2014. 
    
--  The relocation of the borax plant to the Tincalyu mine site will have
    significant benefits through both the reduction of operating unit costs
    and also increasing overall mineral recovery from the mine. 



Corporate



--  Cash Position of A$7.1m at the end of the quarter excluding Olaroz joint
    venture funding. 
--  SAP implementation at Borax Argentina will be completed by December
    2013. 



Olaroz Lithium-Potash-Boron Project

The Olaroz Project is Orocobre's flagship project located in Jujuy province of
Argentina. Together with partners, Toyota Tsusho Corporation ("TTC") and Jujuy
Energia y Mineria Sociedad del Estado ("JEMSE"), Orocobre is building the first
large scale "green fields" lithium brine project in approximately 20 years at a
capital cost of US$229.1m and will have a design capacity of 17,500tpa of
battery grade lithium carbonate. The Olaroz Project joint venture is operated
through Argentine subsidiary Sales de Jujuy SA (SDJ SA). The effective Olaroz
Project equity interest is Orocobre 66.5%, TTC 25.0% and JEMSE 8.5%.


Construction Update 

The construction of the project continues to proceed on time and within budget. 

Since the last quarterly report, the Company announced the commissioning of the
first production wells and the commencement of the filling of the first
evaporation pond at the Olaroz Lithium Project. The first pumping of brine and
filling of evaporation pond 4B occurred at the beginning of August to coincide
with the local customary celebration of Pachamama (Mother Earth). 


The filling of evaporation pond 4B is significant for a number of reasons.
Firstly, the commencement of brine filling is ahead of schedule. Secondly, this
effectively signals the beginning of the first step in the manufacture of
lithium carbonate. Finally, it signals the end of a period where there were a
high number of concurrent activities in progress and also where we reached the
peak headcount on site.


All brine bores have been drilled and bore equipment and infrastructure for
brine supply is 88% complete. Progress is on schedule to reach the full rate by
November as planned. 


The construction of the evaporation ponds is ahead of schedule with 87% of
earthworks completed. The evaporation pond lining program is on schedule.


Other notable events during the quarter are as follows:



--  Water supply wells have been completed 
--  Camp has been completed and is operational 
--  The construction and fit out of the laboratory has been completed 
--  Erection of the lime plant is more than 50% complete 
--  The engineering design of the lithium carbonate plant has been completed
    and the lithium carbonate plant is under construction 
--  The final stage of the roadworks is nearing completion 
--  The gas supply and distribution system is 90% complete 



The project continues to proceed on time and within budget. A total of
approximately US$133m has been spent or committed via executed contracts on the
construction project to date. 


In conjunction with the progress detailed above, activity during the quarter has
been focused on the following tasks:




--  Foundations and metal structure fabrication for process plant buildings,
    soda ash warehouse, finished product warehouse and maintenance
    facilities 
--  Construction of warehouse and maintenance workshop building 
--  Groundwork and concrete foundations of water treatment plant 
--  Waste water treatment plant 2nd stage 
--  Installation of deep well pumps 
--  Civil works in the brine collection area 
--  Evaporation pond construction (conclusion of pond P1, P2, P3) 
--  Erection of liming plant structure and equipment 
--  Water plant tank construction 
--  Gas pipeline construction 
--  Camp infrastructure construction (erection and connection of bulk gas
    tanks) 
--  Overflow channel construction 
--  Construction of process buildings (main building, soda ash and end
    product storage) 
--  Liner installation of second evaporation pond 
--  Construction of reinforced earth gabions for transfer pumps foundation 
--  Construction of overhead power lines 



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
under the supervision of high quality experienced professionals.


To view the photos accompanying this press release, please visit the following
links: 


http://media3.marketwire.com/docs/orop11031.pdf 

http://media3.marketwire.com/docs/orop21031.pdf 

http://media3.marketwire.com/docs/orop31031.pdf 

http://media3.marketwire.com/docs/orop41031.pdf 

For more gallery photos click here:
http://www.orocobre.com/Gallery_Construction_October.htm. 


For more information on Olaroz please click here:
http://www.orocobre.com.au/Projects_Olaroz.htm.


Borax Argentina

Borax Argentina has extensive operations and has a fifty year production history
producing borax chemicals, boric acid and boron minerals. The production
currently comes from three principal mines at Tincalayu, Sijes and Porvenir with
concentrators at the first two locations and a chemicals plant at Campo Quijano
producing refined products. The borax circuit at the chemicals plant is in the
process of being relocated to the Tincalayu mine where the mineral for borax
production, tincal, is mined.  


There are historical estimates on the mineralisation at these mines and at two
undeveloped deposits (please click here for the ASX Announcement on historical
estimates: http://www.asx.com.au/asxpdf/20120821/pdf/4284ngcbwhr77t.pdf). These
estimates currently form the basis for both the current operations and plans for
developing the business.


Operations 

Approximately 10,103 tonnes of combined products were sold during the quarter.
This is an increase on the previous quarter and 10% above the same quarter last
year. Prices achieved were affected by softer market conditions compared to 12
months previous but in line with budget.


Combined product sales volume by quarter: 



----------------------------------------------------------------------------
Quarter                                      Combined Product Sales (tonnes)
----------------------------------------------------------------------------
September 2012                                                         9,161
----------------------------------------------------------------------------
December 2012                                                         10,007
----------------------------------------------------------------------------
March 2013                                                             9,182
----------------------------------------------------------------------------
June 2013                                                              9,562
----------------------------------------------------------------------------
September 2013                                                        10,103
----------------------------------------------------------------------------



Borax Plant Relocation 

As reported in the June quarter report, the Company announced a significant
advance at its 100% subsidiary Borax Argentina on 1st July with the decision to
relocate the borax chemical plant from its current location in Campo Quijano
(close to the city of Salta) to the Tincalayu mine site where the mineral,
tincal, used to make borax is mined. The Borax Argentina chemical plant produces
borax decahydrate, borax pentahydrate and anhydrous borax. 


The relocation of the borax plant to the Tincalyu mine site will have
significant benefits through both the reduction of operating unit costs and also
increasing overall mineral recovery from the mine. 


The progress on the project is running to plan with a high rate of scheduled
activity occurring between October this year and March 2014. Currently the
project is running on schedule and within budget. 


The completion date for the project is forecast to be June 2014. 

The Company considers this project an exciting development which will position
the Borax Argentina business well for the future.


Historical Estimate for JORC Compliant Resource Conversion Programme 

During the quarter, work continued on the programmes to convert the Tinaclayu
historical estimates to JORC compliant resources. The work programme has
involved so far:




--  Extensive pit mapping to provide geometrical controls of stratigraphy
    and structures which will be correlated later with past flitch plans and
    drill logs 
    
--  Geochemical sampling of different horizons to provide controls on past
    drilling and bench plans 



A new 3D model of the mineralised horizon is being constructed in conjunction
with the resampling program undertaken on stored drill core using both internal
and external laboratories. 


During the quarter work also started on the programmes to convert the Porvenir
historical estimates to JORC compliant resources. The mineralisation at
Porvenir, ulexite, is used to make boric acid at the boric acid plant in Campo
Quijano.  


Progress is on track to have a resource estimate completed in the 4th Quarter
2013 for Porvenir and 1st Quarter 2014 for Tincalayu assuming no drilling is
required.  


Once the conversion programme is completed at Tinacalyu and Porvenir, work will
commence on the Sijes hydroboracite deposit and the other salar hosted ulexite
deposits at Diablillos and Ratones.  


For more information on Borax Argentina please click here:
http://www.orocobre.com.au/Projects_Borax.htm.


Corporate and Administration

SAP Implementation

An SAP ERP system has been implemented at Sales de Jujuy SA. The SAP
implementation program at Borax Argentina is in progress and due for completion
by December 2013.


Cash Position 

At the end of the quarter, the company had a cash position of A$7.1m excluding
funds in Olaroz Lithium Project companies.


About Orocobre Limited 

Orocobre Limited is listed on the Australian Securities Exchange and Toronto
Stock Exchange (ASX:ORE)(TSX:ORL), and is building a substantial
Argentinian-based industrial minerals company through the construction and
operation of its portfolio of lithium, potash and boron projects and facilities
in the Puna region of northern Argentina. The Company is building in partnership
with Toyota Tsusho Corporation the first large-scale, de-novo brine based
lithium project in 20 years at its flagship Salar de Olaroz resource, with
projected production of 17,500 tonnes per annum of low-cost battery grade
lithium carbonate scheduled to commence in Q2 2014. The Company also wholly-owns
Borax Argentina, an important regional borate producer. Orocobre has recently
been included in the S&P/ASX 300 Index. For further information, please visit
www.orocobre.com.


Technical Information, Competent Persons' and Qualified Persons Statements

The information in this report that relates to Exploration Results or Mineral
Resources is based on information prepared by, or under the supervision of Mr.
Murray Brooker. Murray Brooker is a geologist and hydrogeologist and is a Member
of the Australian Institute of Geoscientists. Murray has sufficient relevant
experience to qualify as a competent person as defined in the 2004 edition of
the Australasian Code for Reporting of Exploration Results, Mineral Resources
and Ore Reserves. He is also a "Qualified Person" as defined in NI 43-101. 


Additional information relating to the Company's projects is available in
"Technical Report - Salar de Olaroz Lithium-Potash Project, Argentina" dated May
30, 2011, (the Olaroz Report), the "Technical Report - Salinas Grandes Project"
dated April 30, 2010 and the "Technical Report - Salar de Cauchari Project,
Argentina" dated April 30, 2010, respectively, which have each been prepared by
John Houston, Consulting Hydrogeologist, together with, in the case of the
Olaroz Report, Mike Gunn, Consulting Processing Engineer, in accordance with NI
43-101.


Caution Regarding Forward-Looking Information 

This news release contains "forward-looking information" within the meaning of
applicable securities legislation. Forward-looking information contained in this
release includes, but is not limited to, construction at the Olaroz Project and
the timing thereof, the commencement of commercial production at the Olaroz
Project and the timing thereof, the projected production of lithium carbonate at
the Olaroz Project and the expected brine cost and grade at the Olaroz Project. 


Such forward-looking information is subject to known and unknown risks,
uncertainties and other factors that may cause actual results to be materially
different from those expressed or implied by such forward looking information,
including but not limited to the risk of further changes in government
regulations, policies or legislation; the possibility that required concessions
may not be obtained, or may be obtained only on terms and conditions that are
materially worse than anticipated; the risk that the conditions precedent to
draw down the project financing with Mizuho Corporate Bank will not be met; that
further funding may be required, but unavailable, for the ongoing development of
the Company's projects; fluctuations or decreases in commodity prices;
uncertainty in the estimation, economic viability, recoverability and processing
of mineral resources; risks associated with weather patterns and impact on
production rate; risks associated with construction and development of the
Olaroz Project; unexpected capital or operating cost increases; uncertainty of
meeting anticipated program milestones at the Olaroz Project; general risks
associated with the feasibility and development of the Olaroz Project; as well
as those factors disclosed in the Company's Annual Information Form for the year
ended June 30, 2012 filed at www sedar.com. 


The Company believes that the assumptions and expectations reflected in such
forward-looking information are reasonable. Assumptions have been made
regarding, among other things: the timely receipt of required approvals and
completion of agreements on reasonable terms and conditions; the ability of the
Company to obtain financing as and when required and on reasonable terms and
conditions; the prices of lithium and potash; and the ability of the Company to
operate in a safe, efficient and effective manner. Readers are cautioned that
the foregoing list is not exhaustive of all factors and assumptions which may
have been used. There can be no assurance that forward-looking information will
prove to be accurate, as actual results and future events could differ
materially from those anticipated in such information. Accordingly, readers
should not place undue reliance on forward-looking information. The Company does
not undertake to update any forward-looking information, except in accordance
with applicable securities laws.


Not For Release in US

This announcement has been prepared for publication in Australia and may not be
released in the U.S. This announcement does not constitute an offer of
securities for sale in any jurisdiction, including the United States, and any
securities described in this announcement may not be offered or sold in the
United States absent registration or an exemption from registration under the
United States Securities Act of 1933, as amended. Any public offering of
securities to be made in the United States will be made by means of a prospectus
that may be obtained from the issuer and that will contain detailed information
about the company and management, as well as financial statements.


ABN 31 112 589 910

FOR FURTHER INFORMATION PLEASE CONTACT: 
Orocobre Limited
David Hall
Business Development Manager
M: + 61 407 845 052
[e-mail]


Orocobre Limited
James Calaway
Chairman
M: + 1 [phone]
[e-mail]
www.orocobre.com