Rio Tinto's $2.5 Billion Investment Boosts Argentina's Lithium Production Capabilities

Rio Tinto Argentina's Lithium

International mining giant Rio Tinto has announced a substantial $2.5 billion investment in the expansion of its Rincon lithium operation in Argentina, aiming to increase the country's lithium production six-fold over the next decade. This move marks a significant step in Argentina's ambition to become a leading global energy supplier.

Strategic Expansion and Technological Advancements

The Rincon project, located in Salta province, commenced with a 3,000 metric tons per year starter plant in November and is Rio Tinto's inaugural commercial lithium operation. The new investment will enhance annual production to 60,000 metric tons of battery-grade lithium carbonate. Utilizing advanced direct lithium extraction (DLE) technology, the expansion is set to begin construction in mid-2025, with ramped-up production expected to start in 2028 and reach full capacity early in the next decade.

This strategic enhancement not only elevates Rio Tinto's position in the lithium market but also contributes significantly to Argentina's growing status in the global energy sector, alongside its LNG and oil exports.

Argentina's Lithium Market and Economic Reforms

Argentina currently ranks as the fourth-largest lithium producer globally, boasting substantial reserves and resources. The nation is a crucial part of the "lithium triangle," which includes neighboring Bolivia and Chile and holds about 60% of the world's lithium resources.

In support of such large-scale investments, Argentina has implemented economic reforms including the Regimen de Incentivo Grande Inversiones (RIGI), which offers tax and customs benefits, and legal stability for investments exceeding $200 million. Rio Tinto is among the companies poised to benefit from RIGI, reflecting a favorable investment environment under President Javier Milei's administration, which has also introduced sweeping tax reforms aimed at boosting economic stability and growth.