Argentina has approved a $2.5 billion investment by Anglo-Australian mining giant Rio Tinto to expand its Rincon lithium project in the country’s Salta province. This marks the first project sanctioned under Argentina’s new Incentive Regime for Large Investments (RIGI), introduced to attract foreign capital into the mining sector. (Buenos Aires Times, Rio Tinto)
Project Overview
The Rincon lithium project, situated in Argentina’s “lithium triangle”—an area shared with Bolivia and Chile that holds over 60% of the world’s lithium reserves—will increase its production capacity from 3,000 tonnes to 60,000 tonnes of battery-grade lithium carbonate per year. The expansion includes a 3,000-tonne starter plant and a 57,000-tonne expansion plant, with construction set to commence in mid-2025, pending permitting. First production is expected in 2028, followed by a three-year ramp-up to full capacity. The project’s estimated mine life is 40 years. (electrive.com, NS Energy, Kallanish)
Technological and Environmental Considerations
Rio Tinto plans to utilize Direct Lithium Extraction (DLE) technology at the Rincon project. This method is noted for its efficiency in water use and waste reduction, producing lithium carbonate more consistently than traditional evaporation-based techniques. The company emphasizes its commitment to high environmental, social, and governance (ESG) standards, aiming to halve water usage during processing. (NS Energy, Rio Tinto, electrive.com)
Economic and Strategic Implications
The approval of the Rincon project aligns with Argentina’s broader strategy to bolster its position as a leading global lithium producer. The RIGI framework offers incentives such as tax benefits, customs advantages, and regulatory stability for 30 years, aiming to attract significant investment in the mining sector. (Reuters)
This development also underscores the growing importance of lithium in the global transition to electric vehicles and renewable energy storage solutions. With increasing demand for lithium-ion batteries, projects like Rincon are pivotal in meeting the needs of the evolving energy landscape.
Related Developments
In addition to the Rincon project, Rio Tinto has made significant moves in the lithium sector, including a $900 million investment in Chile’s Maricunga lithium project and a $6.7 billion acquisition of U.S. lithium producer Arcadium. These initiatives reflect the company’s strategic focus on expanding its lithium portfolio to support the growing demand for electric vehicle batteries. (Financial Times)
As the Rincon project progresses, it will play a crucial role in Argentina’s mining sector and the global supply chain for critical minerals essential for the energy transition.
BHP Billiton, Rio Tinto hq Picture on Flickr by Eric Fidler
