Economics

25-05-2023 14:03 - JUJUY

Argentina's third lithium project begins to produce and export

After the construction of a processing plant in the Susques salt flat, the Olaroz-Cauchari Project will have the capacity to generate 40,000 tons of carbonate from that mineral.

BY IGNACIO ORTIZ

25-05-2023 | 14:03

Argentina already has three lithium exploitation projects underway.

The Olaroz-Cauchari Project of the mining company Exar will begin the production and first export of lithium carbonate in a few days and will become the third project in operation in Argentina, after the construction with an investment of US$ 976 million of the processing plant in the salt flat located in the Susques department, Jujuy.

This was confirmed by the president of the company in charge of the project, Franco Mignacco, who in dialogue with Télam specified that with the capacity to produce 40,000 tons of lithium carbonate, the Cauchari Olaroz project finished the construction stage and it is expected that it will "it will begin to carry out the first pre-commercial productions in the first days of June."

The beginning of production

As planned in the original project, pre-commercial production will begin with all the complete key systems, after the commissioning team began the production tests of the purification, carbonation systems and the solvent purification process or SX.

Mignacco, who is at the same time president of the Argentine Chamber of Mining Entrepreneurs (CAEM), also explained that with this first production the collection of the initial carbonates of the plant for the export to China of 100 tons will begin, as stated in the investment agreements.

Exar is a national company whose shareholders are the Canadian Lithium Americas Corp and the Chinese Ganfeng Lithium, who so far disbursed the US$ 979 million demanded by the work, which required at the peak of the work the employment of 3,300 people in that location located 4,500 meters above sea level.

The project in the Salar de Olaroz-Cauchari has nearby infrastructure services, such as the main paved routes including the one that connects to the port of Antofagasta in Chile, an electric transmission line, the adjacent 300 MW Cauchari Solar Park and a gas pipeline.

For the operation it is estimated that the company will require about 700 workers directly and almost another 1,500 through its supplier companies and related services: More than 60% of the people come from the province of Jujuy; and 27% more, from the rest of the Argentine NOA.

In this sense, the company communicated in a timely manner that it incorporated numerous collaborators from the surrounding communities, including Susques, Pastos Chicos, Huancar, Puesto Sey, Olaroz and Catua, with whom there is a commitment to sustainable development; and implements job training plans to enhance its insertion into the Project.

In the business society of Exar it also has a minority stake of 8.5% Jujuy Energía y Minería Sociedad del Estado (Jemse), which will have the right to have up to 5% of the production to allocate to eventual local demand.

After this first instance of operations that will begin in the first days of June, it is expected that the additional purification processing equipment necessary to achieve battery-quality lithium carbonate will be completed by the end of 2023 or the beginning of 2024, after the start of the so-called pre-commercial production.

Mignacco also pointed out that silver is expected to enter a production ramp up to reach the capacity of up to 40,000 tons per year ("tpa") of lithium carbonate with battery quality within 18 months, that is, it will be completed by the beginning of 2024.

With that capacity, the project will become the largest production plant in Argentina, which will reinforce with the current planning of the expansion works of Stage 2 for at least 20,000 tpa of additional lithium carbonate, which will be aligned with the completion of the current stage 1.

The other elitio projects in the country

Currently, Argentina has a lithium production of about 37,500 tons per year as a result of the operations of the Fénix plant in the Salar de Hombre Muerto, province of Catamarca and in charge of the American Livent, and that of the Salar de Olaroz that the Australian Allkem, operates in Jujuy.

Both mining companies not only have in development their projects to expand the Catamarca and Jujuy plants, but globally they started a merger process a month ago that will unify and generate a greater synergy between them to form the third largest mineral producer in the world that is key to electromobility and renewable energies.

Argentina is currently considered the fourth global supplier behind Australia, Chile and China, but taking into account the six lithic projects that are under construction and the two that currently operate in the country will allow to reach by 2025 a production of 200,000 tons per year, equivalent to 5,653 million dollars, according to estimates by the Ministry of Mining.

In 2022, lithium exports reached US$ 696 million, which implied a growth of 234% year-on-year, since in 2021 shipments abroad were US$ 208 million, and representing 18% of total mining exports.

In addition, it is estimated that a total of 15 new projects will be able to enter into operation during this decade, which allows us to estimate exports towards 2030 for about US$10 billion, only for lithium carbonate.

But the governments of the producing provinces of Catamarca, Salta and Jujuy, together with the Nation, promote a greater industrialization of the mineral through the manufacture of lithium batteries in agreement with universities and local research centers and oriented to micromobility, the back up of renewable energies and electric cars.

Massa highlighted gas and lithium exports as a "opportunity for phenomenal growth"