The infra problems Argentina must solve to spark the lithium boom

The growth of Argentina's lithium industry must be flanked by extensive roadworks, the modernization of the rail system, new transmission lines, loading and unloading nodes and natural gas transport from the Vaca Muerta deposit to the north.

But infrastructure is still a bottleneck, according to Franco Mignacco, president of Minera Exar, who added that logistics solutions will not only help the lithium industry directly but also support the productive chains generated by lithium.

"At our project [Caucharí-Olaroz], we move almost 300,000t of inputs to produce 40t," Mignacco said in response to a question by BNamericas during a webinar on mining 4.0 hosted by industry groups Unión Industrial de San Juan and Unión Industrial Argentina.

Caucharí-Olaroz in Jujuy province is forecast to produce around 20,000t lithium carbonate equivalent (LCE) this year.

Argentina has four lithium operations in production, five under construction and more than 20 in advanced development stages. Together, they are expected to boost output from 46,000t LCE in 2023 to 230,000t in 2027 and 415,000t in 2030.

“This is without adding a series of other projects that will continue to increase production,” said Mignacco, who is a former director of mining chamber CAEM.

Lithium deposits in Argentina are mostly in the northwestern provinces of Salta, Jujuy and Catamarca, with rising exploration budgets focused on the area.

Exploration investments grew from US$31mn in 2020 to US$140mn in 2023, according to data provided by the economy ministry, which also predicts that lithium exports will reach US$8.73bn in 2030 compared to US$846mn last year.

BNamericas identified six key infrastructure challenges affecting Argentina's lithium industry.

• Modernization of the Belgrano rail line's C14 branch, considered the backbone of the northwestern rail system, whose annual load capacity should increase from 120,000t to 400,000t, according to the World Bank;
• Construction of a 500kV Chaparro-Antofagasta de la Sierra-Puna-Cobos high voltage transmission line to supply Jujuy, Salta, Catamarca and La Rioja;
• Reverse flow of the 100km Gasoducto Norte gas pipeline to pump more gas from Vaca Muerta to the northwest. The EPC contract for the Enarsa project was awarded to Techint;
• Improve road maintenance to support increased traffic and heavier loads;
• Develop multimodal loading and unloading nodes to relieve congestion on national routes;
• Reactivate works on national route 51 to connect Catamarca and Jujuy and the Hombre Muerto, Caucharí and Pocitos salt flats. The sections between Salta and Chile's Antofagasta region across the Sico pass must also be completed. A significant portion of lithium exports for Asia will be transported via this route due to the proximity and logistics of the ports on the Pacific coast.

PORTFOLIO

The Fenix, Salar de Olaroz, Centenario Ratones and Caucharí-Olaroz operations are in production, while Tres Quebradas, Sal de Oro, Rincón, Sal de Vida and Mariana are under construction.

Projects likely to start production in 2026-30 are Hombre Muerto West, Pastos Grandes, Pozuelos Pastos Grandes, Sal de la Puna and Kachi, while Caucharí, Arizaro, Guayatayoc, Hombre Muerto, Incahuasi, Pocitos and Salinas Grandes should start by 2034.

Production increases are planned at Fenix (phase 1 and 2), Sal de Vida (phase 2), Rincón (phase 2), Sal de Oro (phase 2 and 3) and Centenario Ratones.