The cost of building Allkem’s three flagship projects – one in Canada and two in South America – has blown out by $US413 million ($640.7 million) because of higher labour and material expenses, the lithium hopeful says.

Martin Perez de Solay, Allkem’s chief executive, said that while costs would be higher, the outlook for lithium – a key ingredient in the batteries that power electric vehicles and energy storage – remained strong.