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Orocobre Commences Pre-Feasibility Study for Construction of Boric Acid Plant at Olacapato

Orocobre Limited ("Orocobre" or "the Company") is pleased to advise of the commencement of a pre-feasibility study into the construction of a Boric Acid plant at Olacapato in Salta Province, Argentina.

Study Scope

The study will assess the feasibility of constructing a boric acid plant with a production capacity of 16-24,000 tonnes per annum boric acid.

Feedstock for the plant would come from a variety of locations where the Company has mineralisation currently described as historical estimates (Refer to ASX Announcement 21 Aug 2012 found here: http://orocobre.com/PDF/21Aug12_Borax%20Acquisition.pdf) including Porvenir, Ratones and Diablillos located approximately 40kms, 100kms and 130kms respectively from Olacapato. Currently, the Company is in the process of upgrading the mineralisation at Porvenir into a JORC compliant resource as part of this study.

The plant flowsheet will be designed to allow treatment of lower grade ores than are currently being processed and with the aim of obtaining higher recoveries and reduced operating costs. Based on earlier internal company scoping studies, the estimated capital cost of the boric acid plant is in the range of US$13-17million including 35% contingency.

The pre-feasibility study is scheduled to be completed early in the first quarter 2014. Assuming a positive outcome from the pre-feasibility study, the feasibility study would be completed and the required permits obtained in the following six months with a view to commence construction in the latter part of 2014.

Background and Potential benefits

Currently, Borax Argentina produces boric acid from a 9,000 tonnes per annum plant at Campo Quijano near Salta city, processing ulexite mineralisation mined from Porvenir which is located 300kms away. The plant is designed to treat a high grade feed of ulexite mineralisation which has been selectively mined and then upgraded by drying and hand sorting.

There are potential advantages to the construction of a new and larger facility at Olacapato. In particular, by being able to process lower grade "run-of-mine" ore the costly and time consuming process of drying and hand sorting would be eliminated and the mining and processing recovery of mineralisation increased. In addition, the long cartage by road transport would be eliminated and the increased production rate would provide economies of scale compared to current operations.

Boric acid is used in a wide variety of applications including glass, ceramics, fertilisers and wood preservatives. The market has a growth profile above world GDP growth. For standard and agricultural grade boric acid, pricing has ranged approximately between US$750/t to $1,250/t CIF over the past 5 years.

The Borax Argentina business was acquired by the Company from Rio Tinto Minerals in August 2012.

The company recently announced the relocation of the borax chemical plant from Campo Quijano near the city of Salta to the Tincalayu mine. The relocation is due for completion in June 2014.

Richard Seville (Managing Director and CEO) commented: "Borax Argentina SA has been in the Orocobre fold now for a little over a year now and we now have a very good definition and understanding of the business. A lot of work has been done by the local management team in Argentina establishing the building blocks for growth. The borax chemical plant relocation project is well underway and will be completed by June 2014. Now it is time to also direct focus to other products in the borate portfolio and how we position the business for growth. Construction on the Olaroz project is now well advanced and although Olaroz still remains our primary focus and priority, there is an opportunity to develop and improve the Borax Argentina business alongside Olaroz through prudent decisions to improve the cost base and provide a future platform for growth."

The Olaroz lithium project is being developed by Orocobre (66.5%) with partners Toyota Tsusho Corporation ("TTC") (25%) and the Jujuy Province mining and energy company, JEMSE (8.5%) with a construction budget of US$229.1milion including contingency. The project is fully funded and proceeding on time and within budget. First production is scheduled for the end of the second quarter, 2014.

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