The Argentine projects in the hands of newly created Arcadium Lithium

Arcadium Lithium, which resulted from this month’s merger of Australia’s Allkem and US company Livent, will have four projects in Argentina.

The Allkem-Livent deal was announced on January 4 and comes amid a changing scenario under the government of libertarian Javier Milei. 

Arcadium will own the Fénix and Sal de Vida projects in the Salar del Hombre Muerto, Catamarca province, and Caucharí and 66.5% of Olaroz, whose other owners are Japan’s Toyota Tsusho and Jujuy province’s Jemse.

Combined, the assets are expected to produce 212,500t/y of lithium carbonate equivalent (LCE) starting in 2030 and demand over US$3.4bn in investments.

The company will also own assets in China, Japan, the US and Canada, based on an integrated vertical business model, and be listed on the New York Stock Exchange. It will focus on eliminating risks, taking advantage of the experience of Livent and Allkem, and offering value-added products, Arcadium Lithium CEO Paul Graves said in a statement.

Arcadium, registered in Ireland, emerges as the global lithium market is facing an oversupply of 40% starting this year, due to the start-up of various initiatives, but the surplus will disappear by 2031, according to Asia Financial.

In a report on Sal de Vida, Allkem cited consulting firm Wood Mackenzie projections of a lithium deficit arising during the next decade due to an EV battery production boom.

It added that lithium carbonate prices will remain strong in the long term and range between US$26,000/t and US$31,000/t, high enough to keep increasing lithium production for the global energy transition.

Fénix

The operation has capacity to produce 18,000t/y and is being expanded through an investment of US$1.33bn between 2023 and 2028.

A first stage will increase output to 40,000t this year and a second add another 30,000t in 2025, while the third stage targets 100,000t/y from end-2030.

Fénix also currently produces 9,000t/y of lithium chloride at the Güemes plant.

Sal de Vida

This project is under construction and is expected to produce 15,000t/y from 2025 and add 30,000t/y in a second stage through the incorporation of a new chemical plant.

Capex for the initial phase is US$374mn and US$657mn for the second one. IDB Invest pledged to provide financing of US$50mn and the International Finance Corporation US$180mn to support sustainable operations and benefits for surrounding communities.

Olaroz

Last year, Olaroz in Jujuy province produced 16,700t of LCE as part of a first stage that was designed to achieve 17,500t. It will advance toward adding 25,000t/y in a second phase planned to conclude at the end of 2024, according to Allkem's latest technical report.

Caucharí

In the prefeasibility study phase, the project is also in Jujuy and is focused on producing 25,000t/y of LCE with initial investment of US$659mn.

In a recent report, Allkem said progress depends on the risks related to legal and tax reforms and exchange rate regulations, suggesting that technological advances, competition and macroeconomic trends be reviewed before deciding on new investments.