Chinese battery-materials giant Ganfeng Lithium Co is ratcheting up efforts to expand in Argentina, an emerging supply hot-spot for the mineral.
A unit of the lithium supplier plans to purchase 100 percent of Lithea Inc for up to US$962 million, according to Ganfeng’s filing to the Shenzhen Stock Exchange on Monday. The acquisition is still subject to approval from Chinese authorities.
Lithea is owned by LSC Lithium BV, whose ultimate controlling company is Pluspetrol Resource Corp BV, and has salt lake assets at Pozuelos and Pastos Grandes to the west of Argentina’s Salta city, the filing said. Its first phase of production is expected to have annual capacity of 30,000 tons of lithium carbonate.
Argentina has the world’s biggest pipeline of lithium projects and 19 million metric tons of resources that haven’t yet been tapped. Chinese and US companies engaged in bidding wars for Argentina’s lithium resources, while Rio Tinto Group and Zijin Mining Group Co are pouring more than a billion dollars into the country.
Lithium, a key ingredient for electric-car batteries, gained nearly 500 percent in price in the past year, boosting revenue for producers. According to BloombergNEF, prices will still stay elevated in a tight market this year.
Ganfeng has embarked on an acquisition spree spanning Mali to Mexico. The Chinese company already has a stake in the Cauchari-Olaroz project in Argentina’s Jujuy Province, which is scheduled for trial production this year and targets annual production of 40,000 tons of lithium carbonate.
by Annie Lee, Bloomberg