With things such as the full-bodied Malbec, the passionate tango, and the competitive pato, only one country should come to mind. When you add the heart of energy to the list, there should be no doubt of which American country we are referring to. With nearly 20,000,000,000 kg of potential energy underground, it could result in one of the biggest projects ever.
The American country with the heart of energy
The Salta province in northwest Argentina is the heart of energy, with a mining project sporting a US$2.7 billion investment. The massive project was approved by the Large Investment Incentive Regime (RIGI, by its Spanish initials). British-Australian multinational Rio Tinto, the second-largest metals and mining corporation in the world, is behind the impressive Rincón de Litio mining project, and its environmental impact study has already been approved.
It was during the Arminera mining exhibition in Buenos Aires that Daniel González, the Energy and Mining Secretary, confirmed the news of the Rincón de Litio mining project. After the announcement had been made, the head of the Argentine Chamber of Mining Companies, Roberto Cacciola, stated:
“there was a difference between energy and mining in terms of which projects were approved.”
The Rincón de Litio mining project
The company indicated in a statement that it will stand by the investment, as it highlights its commitment to “establishing a world-class portfolio of battery materials.” So, if you have not guessed it yet, the Rincón de Litio mining project will mine Argentina’s vast lithium reserves. The country comprises nearly 20% of the world’s reserves, with almost 20,000,000,000 kg under the ground.
“With the RIGI, there is respect for the economic equation of the business.” – President Javier Milei
According to Rio Tinto, Rincón de Salta has an annual production capacity of high-value lithium carbonate of 60,000 tonnes. And business could be booming, as lithium is known to be used for batteries for electronic vehicles (EVs). The present plant already has a 3,000-tonne capacity, and thank to RIGI, the expanded plant will have a 57,000-tonne capacity, with construction planned to commence in mid-2025.
The company’s official press release highlighted that the Rincón de Litio mining project reportedly has a 40 year lifespan and its production will officially kick off in 2028. Local businesses can expect a boost in economic opportunities and there will be a significant increase in job availability. However, is lithium worth it in the long run?
This alkali metal has many advantages and disadvantages
Lithium has been highlighted in the transition to clean energy in the automobile sector, as it is utilized in EV batteries, grid-scale energy storage systems [ESS], and popular electronics as smartphones and laptops. According to Seeking Alpha, Lithium Argentina, and its stock LAR are “extremely undervalued and have a strong production outlook.” However, it is important to consider both the advantages and disadvantages of the alkali metal before deciding whether it is worth all the hype.
Advantages of lithium
- Lithium batteries:
- Efficient and compact
- Can store a lot of energy
- Have a long lifespan
- Charge fast
- Harmful heavy metals are non-existent
- Long-term deficit and potential market demand
- Gradual increase in price
- $11,000 per tonne by the end of 2025
- $17,327 for 2028
Disadvantages of lithium
- Lithium batteries:
- Thermal runaway risk due to high temperatures
- Release of extreme heat and toxic gases
- Release of flammable gases
- Increased fire risk
- Risk of explosions
- Charge and discharge cycles degrade the battery
- Unreliable prices due to varying factors
Lithium as a battery for EVs truly does play a significant role in contributing to global zero-carbon emissions. Yet, with so many EV recalls that have been made due to fire risks, the jury’s still out on its true long-term viability, especially as many other breakthroughs have been made in the automobile industry.
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