FMC raises Argentine lithium outlays 50 percent; new technology speeds development, cuts costs.

CHICAGO--(BUSINESS WIRE)--Oct. 24, 1995--FMC Corp. Tuesday announced it is increasing capital spending for its Fenix lithium project from $45 million to $68 million, to accelerate and expand the scope of development and production at the new Salar del Hombre Muerto location in the Argentine Andes.

Based on a new high-yielding proprietary FMC lithium extraction technology and better-than-expected conditions and reserves, ``the Fenix project will consolidate FMC's position as the world's leading lithium producer, further enhance our cost structure and flexibility in lithium production, and make obsolete the economics of new grassroots capacity from the traditional carbonate process,'' said Robert N. Burt, chairman and chief executive officer of FMC.

Burt noted that, in a broader sense, Fenix reflects FMC's strategic corporate commitment to extend core businesses, expand global sourcing and production, and continue to provide customers with the highest value-added products at very competitive prices.

Based on production at the commercial-scale pilot plant located at the salar, ``FMC now expects to start production at least three months earlier than planned, to produce lithium carbonate as well as lithium chloride, with the ability to operate at full production for at least 75 years, rather than 40 years as initially expected,'' said W. Reginald Hall, FMC vice president and general manager of FMC's Specialty Chemicals Group, which includes the Lithium Division.

Hall said lithium carbonate production will be added on-site at the outset because ``our new, next-generation brine technology is so effective that adding the carbonate step is virtually cost-free.'' Adding carbonate to chloride production at the salar already has led to identification of additional processing improvements and cost reductions. FMC is the only lithium producer with basic operations in both lithium and soda ash, a major raw material for lithium carbonate; capabilities in soda ash were recently enhanced as a result of expansion and improvements at FMC's Wyoming mines.

Gonzalo Tufino, president of Minera del Altiplano SA, the operating subsidiary responsible for implementing the venture, said that the presence of an unlimited water source for FMC's new, advanced brine-extraction technology continues to justify the choice of the Argentine salar, which is 100 percent owned by FMC. Other benefits include higher-than-expected concentrations of lithium, lower brine contaminants than any known South American salar, higher and more consistent evaporation rates and excellent transportation infrastructure. Despite its remote location and 13,000-foot elevation, Fenix is well served by railroads and has easy access to ports in Chile and Argentina.

Salar brine capacity will be 45 million pounds per year of carbonate equivalent. (Original brine capacity had been estimated at 30 million pounds.)

The new selective purification technology, which reduces the number of production steps, also allows the use of pre-engineered modular production units. Faster construction schedules are part of the reason initial commercial operations will begin in late 1996.

The Fenix project, located on the salar in the Andean Mountains 800 miles northeast of Buenos Aires, is Specialty Chemicals' largest capital project over the next two years, Hall said.

Lithium is a naturally occurring element that over the past 40 years has become an important manufacturing and research ingredient. It is widely used in production of aluminum, glass, ceramic, rubber, plastic and textiles. Lithium is a prime ingredient in batteries, multipurpose greases, water sanitizers, air conditioning systems and pharmaceuticals.

FMC Lithium Division, based in Gastonia, N.C., is the world's largest vertically integrated producer and marketer of lithium chemicals, lithium metal and related chemical and mineral products. In addition to Gastonia and Fenix, FMC Lithium has operations at Bessemer City, N.C.; Bayport, Texas; Pacolet, S.C.; Bromborough, England; and an Asia-Lithium joint venture in Osaka, Japan.

FMC Corp. is one of the world's leading producers of chemicals and machinery for industry, government and agriculture. The Chicago-based company reported annual sales of $4 billion in 1994, with international sales to more than 100 countries accounting for 49 percent of total annual revenues. FMC employs 21,000 people in 97 manufacturing facilities and mines in 21 countries. The company divides its businesses into five major segments: Performance Chemicals, Industrial Chemicals, Machinery and Equipment, Defense Systems and Precious Metals.

CONTACT: FMC, Chicago

Pat Brozowski, 312/861-6104

or

Minera del Altiplano SA (Salta, Argentina)

Gonzalo Tufino, 54-87-31-0272

or

INVESTOR RELATIONS CONTACT:

FMC

Lisa Azzarello, 312/861-6921