Chinese company will invest US$2.2 billion in Argentina to explore lithium projects

The Chinese company Tibet Summit Resources will invest US$2.2 billion in two lithium exploration projects in Argentina, the company informed the Argentine ambassador to the Asian nation, Sabino Vaca Narvaja.

“Chinese company announces investments in lithium in Argentina of more than US$2 billion,” the Ministry of Foreign Affairs said in a statement.

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The Chinese firm plans to allocate US$700 million to a project located in the province of Salta (north) called ‘Salar de Diablillos’, where from 2023 it hopes to produce 50,000 tons of lithium carbonate per year suitable for batteries.

Another US$1.5 billion will be invested to build a plant in the “Salar Arizaro”, in the same jurisdiction, with the purpose of having it finished by 2024, in order to extract between 50,000 and 100,000 tons of ore. This was reported to the Argentine ambassador by the president of the Chinese firm, Jian Rong Huang, within the framework of the China International Import Exhibition, which was held in the city of Shanghai.

The price of lithium carbonate reached an all-time high last week, increasing by almost US$78,000 per ton, with an accumulated growth of 130% in the last year, according to the Government.

With these reference prices, the South American nation could enter US$8 billion in the short term.

The Argentine ambassador to China, Sabino Vaca Narvaja, stressed that the Government promotes the development of lithium by granting benefits to companies that invest in this area.

“We have several projects under construction for the production of lithium carbonate in our country led by Chinese companies; in fact, of the nine mining projects with Chinese capital in our country, six correspond to projects for the extraction of this mineral,” he specified.

Vaca Narvaja explained that “China is the only world player that totally dominates the lithium chain and refines more than two thirds of the lithium that exists today.”

“Our country has a privileged position and we must fully exploit it hand in hand with China,” he added.

The Chinese firm expressed its expectation of generating 10,000 jobs with its investments. It will develop its projects through a technology called “membrane absorption”, which allows an extraction 80% higher than the traditional one, as announced.

The company has had a presence in Argentina since it acquired Lithium X Energy Corp. in 2018, which allowed it to control its two subsidiaries: Potasio y Litio de Argentina and Tortuga de Oro.

The so-called ‘lithium triangle’, which brings together Argentina, Bolivia and Chile, stores 85% of the world’s reserves of this mineral, but only the Argentine territory has more than 870,000 hectares available for exploitation in the provinces of Catamarca (north), Salta and Jujuy (north).

Argentina ranks third in the world in reserves, behind Chile and Australia, according to a list by the United States Geological Survey, in which Bolivia does not appear because its resources are not quantified.

The South American nation falls back to fourth place after Chile, Australia and China in terms of production level, generating 7.5% of what is extracted worldwide.

With information from Sputnik