Argentina to invest US$4.2bn to become global lithium powerhouse

Argentina will invest US$4.2bn to spur lithium mining, which, according to the chamber of mining entrepreneurs, could help double production in 2023 and hit 175,000t in 2025.

In 2020, Argentina produced 33,000t and is expected to reach 50,000t this year. The figures are all lithium carbonate.

The investment was announced by productive development minister Matías Kulfas last week at a lithium roundtable discussion. Funds will be essential to improve efficiency and facilitate industrialization, also involving infrastructure. Kulfas said the government aims to make Argentina the world's third or fourth biggest lithium producer.

“We are taking decisive steps with the US$4.2bn investment and through the implementation of public policies,” said Kulfas.

At the event, the governors of Salta, Jujuy and Catamarca provinces signed a regional trade agreement to promote the lithium industry.

Argentina’s portfolio includes 23 projects in different phases, according to the latest lithium report by the productive development ministry. Two assets are currently operational and being expanded. Fenix, in the western Hombre Muerto salt flat in Catamarca province, produces 20,000t/y of lithium carbonate. Owner Livent plans to add 30,000t/y by the end of 2025. Olaroz salt flat in Jujuy province produces 25,000t/y of lithium. Operated by Sales de Jujuy, comprising Orocobre (72.68%) and Toyota Tsusho (27.32%), and state-run Jemse, output is planned to triple by 2026.

The US$641mn Cauchari-Olaroz project is under construction and expected to become the country’s biggest producer with 40,000t/y by the second half of 2022. The mine is located in the Olaroz salt flat and the Cauchari salt flat and owned by Minera Exar, comprising Lithium Americas (44.8%), Ganfeng Lithium (46.7%), and Jemse (8.5%). 

Argentina has an estimated 19.3Mt of of the world’s 89Mt lithium resources, according to the US Geological Survey, ranking among the top four lithium countries, together with Bolivia (21Mt), Chile (9.8Mt), and Australia (7.3Mt).

Lithium is a key input in the energy transition. Due to rising battery demand, lithium demand will increase about 30% by 2030 and be 100 times higher in 2050 than in 2020, according to the net-zero roadmap of the International Energy Agency.