Chinese mining firms are expanding their lithium extraction operations in Argentina.
The Argentine government recently reported that these companies are promising to pour billions into the country’s rich lithium reserves following a meeting in Shanghai between the Economy Minister Sergio Massa and Chinese companies.
Tibet Summit Resources, Ganfeg Lithium, and Tsingshan Holding Group are among the firms planning considerable investments in several lithium projects in the country.
These investments will bolster the production capacity of lithium in Argentina, with the Olaroz-Cauchari lithium mine, owned jointly by Jiangxi Ganfeng Lithium Co. Ltd. of China and Canadian Lithium Americas Corp, expected to start operations in late 2023.
The agreement secures a supply of 40,000 tons of lithium per year to China.
Jorge Serrano, a security consultant, suggests that Argentina is strategically aligning with China to access strategic resources like lithium, given the importance of lithium in various global industries such as batteries, nuclear energy, and digital devices.
Argentina, the world’s fourth-largest lithium producer, intends to increase its lithium carbonate exports from about 40,000 metric tons in 2022 to 200,000 metric tons per year by 2025.
Argentina’s relationship with China has seen significant developments, including allowing a Chinese space station to be placed in Patagonia.
Argentina, Bolivia, and Chile, known as the Lithium Triangle, collectively hold about 55 percent of the world’s lithium reserves.
In these countries, several lithium deposits are managed by regional governments reportedly having links with China.
However, Serrano raises concerns about the potential environmental impacts of these operations, including potential deforestation and pollution, particularly in regard to water resources.
These environmental concerns have raised questions about the transparency and accountability of China’s lithium operations in Argentina.
China is also investing in other large lithium producers and countries with untapped reserves such as Bolivia and Chile.