Chinese firm Ganfeng Lithium has closed a previously announced transaction to increase its interest in the Caucharí-Olaroz lithium brine project in Jujuy, Argentina from 37.5% to 50%.

Ganfeng Lithium Netherlands subscribed for new shares of Minera Exar, the holding company for the Caucharí-Olaroz project.

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Minera Exar will use the $160m raised from the transaction to fund the project’s construction. The remaining 50% interest in the project is owned by Lithium Americas.

In October last year, Ganfeng Lithium completed the acquisition of a 37.5% interest in Minera Exar from Chilean miner SQM.

Lithium Americas president and CEO Jon Evans said: “We are delighted to complete the project investment with our 50/50 joint venture partner, Ganfeng Lithium, building on our long history of working together.

“At Caucharí-Olaroz, construction activities continue to proceed on schedule with over 600 employees and contractors mobilised at site.”

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“With the Project Investment complete, we have further strengthened our liquidity and expect to release the results of a feasibility study on an expanded initial production capacity for the project of 40,000 tonnes per annum (tpa) of battery-grade lithium carbonate in September 2019.”

The $160m project investment included an advance payment of $57m prior to closing.

In a separate development, Lithium Americas amended an offtake agreement with BCP Innovation (Bangchak).

As per the terms of the revised agreement, if an expansion of the initial production capacity to 40,000tpa is approved, Bangchak will be entitled to buy an additional 3,500tpa of lithium carbonate.

The project is located around 270km east of SQM’s Salar de Atacama brine operation.

With current targeted production of 25,000tpa, the Caucharí-Olaroz project is expected to start production by the end of next year.

In May this year, Ganfeng Lithium agreed to buy a 29.99% equity interest in Bacanora Lithium.