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Rio invests in Argentinian lithium

4th January 2022

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

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PERTH (miningweekly.com) – Diversified giant Rio Tinto in December struck a $825-million deal to acquire the Rincon lithium project in Argentina from Rincon Mining.

Rio said in December that the acquisition demonstrated the company’s commitment to build its battery materials business and strengthen its portfolio for the global energy transition.

Rincon is a large undeveloped lithium brine project located in the heart of the lithium triangle in the Salta province of Argentina, an emerging hub for greenfield projects. The project is a long life, scaleable resource capable of producing battery-grade lithium carbonate. It has the potential to have one of the lowest carbon footprints in the industry which can help deliver on Rio Tinto’s commitment to decarbonise its portfolio.

“This acquisition is strongly aligned with our strategy to prioritise growth capital in commodities that support decarbonisation and to continue to deliver attractive returns to shareholders. The Rincon project holds the potential to deliver a significant new supply of battery-grade lithium carbonate, to capture the opportunity offered by the rising demand driven by the global energy transition,” Rio Tinto CEO Jakob Stausholm said.

“It is expected to be a long life, low-cost asset that will continue to build the strength of our Battery Materials portfolio, with our combined lithium assets spanning the US, Europe and South America.”

Once acquired by Rio, the Rincon project will be subject to the completion of studies to confirm the resource and define an Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, 2012 compliant resource statement.

Work will be undertaken to determine the development strategy and timing, secure updates to existing environmental impact assessment permits to allow development and production, and undertake ongoing engagement with communities, the province of Salta and the government of Argentina. This consultation process will ensure we build a world-class operation in the province of Salta.

The direct lithium extraction technology proposed for the project has the potential to significantly increase lithium recoveries as compared to solar evaporation ponds. A pilot plant is currently running at the site and further work will focus on continuing to optimise the process and recoveries.

Rio told shareholders that the market fundamentals for battery-grade lithium carbonate are strong, with lithium demand forecast to grow 25% to 35% a year over the next decade with a significant supply-demand deficit expected from the second half of this decade.

As the project is currently held through an Argentine branch of an Australian company, completion of the transaction is conditional upon approval by Australia’s Foreign Investment Review Board (Firb). Subject to this Firb approval, the transaction is expected to be completed in the first half of 2022. 

Edited by Creamer Media Reporter

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