Miners Ultra Argentina SRL and China’s Zangge Mining have committed US$290 million in investments to explore and develop lithium deposits in northwest Argentina, as well as to build a plant, the minister of industry Daniel Scioli announced.
Zangge Mining will initially invest US$40 million in the exploration and development of the Laguna Verde lithium project in the province of Catamarca.
A further investment of US$250 million is planned at a later stage for the construction of a lithium carbonate processing plant.
In June, Canada’s Ultra Lithium (TSXV: ULT) and Zangge signed a definitive association agreement for the Laguna Verde project.
As part of the deal, Zangge agreed to pay Ultra Lithium US$10 million and invest US$40 million in the project for a 65% stake in Ultra Argentina, a 100%-owned subsidiary of Ultra Lithium.
Argentina sits atop the “lithium triangle” a region shared with neighbouring Chile and Bolivia, which contains nearly 56% of the world’s resources of the metal, according to the most recent figures from the United States Geological Survey (USGS).
This means, according to productive development minister Matías Kulfas, the country has the potential to become the world’s third or fourth biggest lithium producer.
The government has projected to receive a US$4.2 billion combined investment in its growing lithium market over the next five years, which would help Argentina to double production in 2023, reaching 175,000 tonnes of the battery metal in 2025.
The country has attracted over the past year major players, including the world’s second largest miner Rio Tinto (NYSE: RIO; LSE: RIO; ASX: RIO) and South Korean steelmaker Posco.
The nation’s lithium portfolio includes 23 projects in various stages of development, including Ganfeng Lithium and Lithium Americas’ under construction Caucharí-Olaroz. The project is expected to become Argentina’s top producer with 40,000 tonnes of lithium carbonate equivalent (LCE) a year, starting in second half of 2022.
Australia’s Orocobre and U.S. miner Livent Corp., which have supply tie-ups with Toyota Corp and BMW respectively, operate the two producing lithium mines in the country.
