The company said the pilot plant was designed to produce up to 3 tonnes per month of battery-grade lithium carbonate.

"Despite COVID-19 restrictions and minor delays, the Millennial team has advanced the lithium concentration ponds and the pilot plant to the production stage," president and CEO Farhad Abasov said.

The development comes as lithium remains in a low-price environment due to oversupply and ramifications of COVID-19. 

"While Benchmark expects the lithium market to remain in a surplus moving into 2021, we forecast a structural deficit from 2022 onwards as insufficient supply is due to come online to meet the battery industry's growing needs," Benchmark Mineral Intelligence said last week.

Millennial Lithium had received an environmental permit for Pastos Grandes in June.

The 40-year, 24,000tpa project would cost about US$450 million, according to a 2019 feasibility study, which put after-tax NPV8 at $1 billion and IRR at 24.2%.

Operating costs were put at $3,388/t for years seven to 40.

Abasov said despite COVID-19 restrictions and slowdowns, the company had continued progressing its work with a number of off-takers and strategic investors.

"Millennial remains well-funded and continues in its financing efforts to advance development of the Pastos Grandes project," he said.

The company had C$19.1 million in working capital at May 31.

It shares (TSXV: ML) touched a one-year high of C$1.90 earlier this month.

They closed up 12.6% to $1.61 yesterday to capitalise it at $134 million (US$102 million).