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ECONOMY | 07-03-2023 13:07

Argentina's government moves to stop wetlands bill from foiling lithium boom

Government in talks with firms, policy makers to prevent wetlands-protection bill from slamming brakes on lithium exploration.

President Alberto Fernández’s government is in talks with policy makers and companies to prevent drafted wetlands-protection legislation from slamming the breaks on exploration as the world looks for more environmentally friendly energy sources.

Argentina is on course to become one of the biggest suppliers of lithium needed for the move to cleaner energy and transportation. The country has been working on legislation, pushed by its president in a major speech last week, to protect its wetlands amid sprawling fires often blamed on farmers. But such a law could grind lithium exploration to a halt.

“We’re all convinced that looking after the environment is a central pillar of development,” federal Mining Undersecretary Fernanda Ávila said in an interview at a mining conference in Toronto. “What we’re debating and discussing is how the wetlands law can go through without putting mining projects at risk.”

Some versions of the legislation classify Argentina’s lithium-rich Andean salt flats, a growing magnet for international miners and battery makers, as wetland areas because of the vast saline pools beneath the surface. Governors of the country’s three main lithium provinces have voiced strong concerns that a law would therefore impede exploration for the metal.

The federal government is working with the provinces and an industry group representing miners to make sure that doesn’t happen, Ávila said.

The government is also trying to convince miners that Argentina is ripe for long-term investments after piecemeal policies to address the country’s restrictions on money flows and export taxes fell short.

“We’re talking with companies, which are generally investing no less than US$4 billion, to give them better assurances through an agreement encompassing several issues,” Ávila said.

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by Jonathan Gilbert & James Attwood, Bloomberg

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