Anglo-Australian mining firm Rio Tinto has agreed to acquire Rincon lithium project in Argentina from Rincon Mining, in a deal worth $825m.
Located in the lithium triangle in the pro mining province of Salta, the Rincon is a large undeveloped lithium brine project with a potential to produce battery grade lithium carbonate.
The deal forms part of Rio Tinto’s plan to build its battery materials operations.
Rio Tinto CEO Jakob Stausholm said that the takeover is in line with its plan to channel growth capital in commodities that enable decarbonisation.
Stausholm stated: “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.”
Upon completion of the deal, Rio Tinto plans to undertake studies at the Rincon project to validate the resource and define an Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, 2012 (JORC Code) compliant resource statement.
The work is expected to help determine the development strategy for the project, which would use direct lithium extraction technology to significantly increase lithium recoveries as compared to solar evaporation ponds.
Rincon Mining is owned by funds managed by private equity firm Sentient Equity Partners.
Currently, a pilot plant is operational at the site. Further work is planned to focus on further optimising the process and recoveries.
The deal is pending clearance from Australia’s Foreign Investment Review Board (FIRB) and planned for completion in the first half of 2022.
Earlier this year, Rio Tinto announced plans to invest $2.4bn in Serbia’s Jadar lithium-borates project, which will have around 58,000 tonnes of battery-grade lithium carbonate production capacity.