Argentina is already, with only two projects in production, the fourth largest global producer of lithiumbut is preparing to make a leap in magnitude thanks to the steady progress of other projects in the pipeline and the “boom” investment going through the sector.
According to official data, between 2020 and 2021 investment announcements in lithium mining in Argentina rose to US$3,382.5 million.
The effervescence in the enormous salt flats of northwestern Argentina does not stop: since the beginning of 2022, there have been two to three weekly announcements from different companies -mostly American, Australian, Canadian and Chinese- about new exploration campaigns, project expansion , acquisitions and more investments, including one for 380 million from China Zijin Mining for the construction of a lithium carbonate plant in the project three creeks.
“Argentina has gone through a stage of strong investment in exploration in the last ten years, in which a very important portfolio of projects was developed”said the president of the Argentine Chamber of Mining Entrepreneurs, Franco Mignacco.
Argentine lithium map
According to the most recent data from the United States Geological SurveyArgentina is currently the world’s fourth largest producer of lithium (behind Australia, Chile and China), the third in reserves (behind Chile and Australia) and the second in resources (behind bolivia).
Argentina has 38 lithium projects concentrated in three northwestern provinces (Jujuy, Salta and Catamarca), of which two are in production, six under construction, two in the feasibility stage, three in pre-feasibility, five in preliminary economic evaluation, and twenty in the advanced exploration stage.
The two projects in production – Fénix, from the American company LiventY Olarozin which are associated the Australian Allkemthe Japanese Toyota Tsusho and the Argentine state-owned company Jemse – jointly produce some 40,000 tons of lithium carbonate per year, but they have plans underway to double their production capacity.
In addition, it is expected that the project will go into production in the second half of the year. Cauchari-Olarozfrom mining Examine (owned by the Canadian Lithium Americasthe China Ganfeng Lithium and Jemse), with a projected production of 40,000 tons per year.
Thus, Argentina could reach a production of 120,000 tons by 2023-2024.
“Only with these three projects would Argentina be in third place worldwide and we would be very close to being able to fight for second place against Chile”he claimed Mignacopresident of Exar.
According to official calculations, the current portfolio of projects in Argentina has a production potential of 328,500 tons of lithium carbonate per year.
Demand encourages investment
With a limited world supply of lithium, the growing demand for “white gold” for the manufacture of batteries for electric cars and other electronic devices continues to drive international prices, which went from US $ 9,000 per ton of lithium carbonate equivalent ago a year to currently hover around US$75,000.
At these values, many projects in Argentina increase their economic viability.
“We are seeing very promising forward demand. It is estimated that by 2040 current demand will triple, which greatly accelerates all projects in the pipeline worldwide, not only in Argentina”Mignacco noted.
According to Jorge gonzalezdirector of Promotion and Mining Economy of the Argentine government, the country is more “competitive” than others because its salt flats allow lower operating costs than those of lithium extraction from pegmatites -form of production led by Australia-.
“In this positive context for the sector, the national government has taken various steps to enhance this effect”assured González, who highlighted the legal framework of incentives for mining in Argentina and other actions to promote investments.
For Mignacco, Argentina also has comparative advantages over Chile and Bolivia, the other two vertices of the so-called “lithium triangle” south american
In Bolivia, lithium extraction is in the hands of the State, while in Chile, which declared lithium a resource of strategic value, the State has the power to require mining companies that part of the process of adding value to the extracted raw material be do in Chile.
“Argentina, not having taken any definition of nationalizing, nationalizing the resource or declaring it strategic, today has an investment flow of more than US$4.5 billion to US$5 billion in a portfolio of projects that other countries do not have”Mignacco pointed out.