209,770,500 shares now outstanding....?!, page-8

Hey NRC,

It is hard to blame you for being irritated at equity raises that took place to take the Company through commissioning and plant rectification. I certainly was. However, I would point out:

1) Plant commissioning, and particularly chemical plant commissioning, often takes a long time. I am not saying that Orocobre did everything correctly, but it would be naïve to expect perfection for first time managers of the first brine project in years. They don't call it the "bleeding edge" for nothing!

2) By undertaking the first new project in years, Orocobre has been able to capitalize on much higher lithium carbonate prices than suggested to investors prior to commencement of plant construction. Even in US dollars, the difference between pre-construction estimates of lithium pricing per ton and current average achieved pricing is large (9,000 -10,000 USD now versus 6,000 USD then). Add to this the strengthening in the USD that has occurred over the past three years, and the beneficial changes in the Argentinian political landscape. These are not changes caused by Orocobre management. However, if Orocobre had not given investors the chance to put money into a lithium brine operation in Argentina, it is unlikely investors would have benefitted from these changes.

3) The extra time and money that it took to bring the plant to nameplate capacity (and perhaps a little bit past it, I hope) should have allowed Orocobre to better understand the Oloroz chemistry. This substantially reduces one of the sources of risk for the potential expansion.

4) Another major risk to the expansion that has been significantly mitigated is the provision of infrastructure, both hard and soft - gas pipelines, water, employee infrastructure, training programs, local community benefits agreements, plant and equipment are all at least partially in place for the expansion project. This advantage should allow Orocobre to build the expansion at a fraction of the price, and hopefully even save some time over the first plant. In depth knowledge of the permitting and studies necessary to achieve timely completion of an expansion won't hurt either.

5) The Company has indicated that no new capital should be required for the expansion - Cannacord recently estimated a $135 million cost for a 15,000 per year expansion. I know Orocobre would like to go a bit bigger, and potentially produce some lithium hydroxide. With close to $100,000 million returning to the Company over the next couple of years, and a debt deal already in place for the first plant, it would seem that Orocobre has a very good chance of building the expansion without any additional equity raise.

Of course, I am fairly frustrated with the recent share performance. I think the general perception in the investing world is that there are now hundreds of lithium companies. In reality, only a few new entrants will be able to take advantage of the current tight market conditions. The customs data shows that the pricing and volumes continue to improve for the Company. In my opinion, they are extremely well-positioned for an expansion.

All the best,
CB