Rio Tinto to acquire Rincon Mining lithium project
Rio Tinto announced that is has acquired the Rincon lithium project in Argentina from Rincon Mining for $825 million.
Lithium has become one of the most sought after minerals because of its use in batteries used in electric vehicles. Earlier this year, Rio Tinto committed $2.4 billion to develop its Jadar lithium project in Serbia but has faced significant protests from environmental groups.
The company said in a statement that the acquisition of the Rincon project demonstrates Rio Tinto’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 that can help deliver on Rio Tinto’s commitment to decarbonize its portfolio.
“This acquisition is strongly aligned with our strategy to prioritize growth capital in commodities that support decarbonization and to continue to deliver attractive returns to shareholders,” Rio Tinto Chief Executive Jakob Stausholm said. “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. 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 Tinto, 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 (JORC Code) 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 optimize the process and recoveries.
The market fundamentals for battery grade lithium carbonate are strong, with lithium demand forecast to grow 25-35 percent per year annum over the next decade with a significant supply demand deficit expected from the second half of this decade.