Argentina Lithium: A bright 2023 for lithium exploration projects

2023 is set to end on a high for  Argentina Lithium and Energy Corp., as it looks to make significant progress at its lithium exploration projects in Argentina.

As a leader in lithium exploration projects in Argentina, the Company is well positioned to make substantial progress during the remainder of this year. The company is actively pursuing expansion from discovery at the Rincon salar adjacent to the west and north of Rio Tinto PLC (RIO.L, RIO.NYSE).

At the Antofalla salar, the company controls the Antofalla North project, adjacent to the north of Albemarle Corporation’s (NYSE: ALB) large Antofalla project.

With a highly qualified management team consisting of experienced, lithium-oriented geologists, with C$5.4m in cash (as of 31st March 2023) and with large positions in the Rincon and Antofalla salars, the company is well positioned for the discovery of additional lithium brines. The lithium market remains seriously undersupplied.

Argentina Lithium’s discovery at Rincon West

The Rincon West project covers a large basin, adequately large to contain significant lithium in brine.

Argentina Lithium controls 3,742 hectares at the Rincon salar, or the equivalent of 6 x 6 km, lying adjacent to the west side of the Rio Tinto concessions, including an additional parcel of approximately 850 hectares that is adjacent to the north of Rio Tinto, and which is also believed to be prospective.

Early in 2022, the company applied geophysical imaging at Rincon West, and confirmed the potential for lithium brines under two thirds of the initial property area. A diamond drill was mobilised to site in May 2022, and the company has now completed and reported the assays from all holes of an initial nine-hole lithium exploration programme.

All holes completed at Rincon West sampled lithium-enriched brines. Drilling focused on the central part of the property where excellent brine grades – similar to those reported in the past for Rio Tinto’s Rincon property (Montgomery & Associates, July 26, 2021, the last resource estimate before Rio’s acquisition) – have been returned over broad intervals in the majority of holes.*

Prospective expansion at Rincon West

Argentina Lithium, with professional outside consultants, has begun the modelling work for a potential future resource estimation for this first area based on these positive results. Additionally, the company is scheduled to begin drilling five holes on the adjacent Rinconcita II block on the east side of Rincon West shortly. The second hole from the initial nine holes, one of the best holes drilled, lies directly adjacent to the west border of Rinconcita II.

The company will then move its lithium exploration focus to the company’s third property in the Rincon Salar, the Paso de Sico block lying to the north of Rio Tinto.

Rincon salar: A leading basin in the Lithium Triangle with two projects initiating production near term

Argosy Minerals Limited (ASX:AGY), an Australian public junior, controls concessions in the southeast area of the salar. On 3 July 2023, the company announced it has produced around 20 tonnes of battery-grade lithium carbonate with average quality of 99.79% from small-batch operations on site at the Rincon salar. The company initiated continuous operations on a trial basis as of the end of June.

By achieving production and sales of lithium carbonate at the rate of 2,000 tonnes/year, Argosy is targeting earning the capital to increase production to 10,000 tonnes/year. The company is advancing formal progress with strategic arrangements for offtake and capital funding for the 10,000 t/year level.

Rio Tinto has big plans at the Rincon salar

Rio Tinto, the world’s second-largest mining company by market capitalisation, acquired most of the Rincon salar in March 2021 from Rincon Mining for $825m. The company has been very active with lithium exploration projects in Argentina since making the acquisition.

According to miningweekly.com, Rio Tinto has constructed and is operating a pilot plant on site. It is aggressively drilling to expand the resource and has started construction of a 3,000-tonne/year starter plant to produce lithium carbonate commencing in 2024. Its plan is to have the starter plant serve as a pilot for a much larger, 50,000-tonne/year plant there.

Rio Tinto also announced last year that it has signed a Memorandum of Understanding with Ford Motor Company for delivery of lithium carbonate from the Rincon salar.

A fourth company is now commencing lithium exploration at the Rincon salar
Power Minerals Limited (ASX: PNN), a small Australian public company, recently acquired a concession in the far southwest area of the Rincon salar, south of Argentina Lithium. The company has completed one of three planned drill holes and released results from the first hole on 29th June 2023. Here, the company averaged grades of 272.7 mg/litre from 15 samples across 345m.

The company’s second hole is anticipated to be completed this summer.

Summary of the status of the Rincon salar

As stated, four companies are aggressively exploring and developing lithium assets at the Rincon salar in northwestern Argentina. Two are targeting initial near-term lithium production, including the world’s second-largest mining company.

Argentina Lithium is working toward the goal of generating its first lithium brine resource estimate at Rincon. It has completed its first successful drilling programme and will potentially drill two additional concession packages this year. Electric vehicle (EV) and battery manufacturers are likely watching developments at this salar.

Argentina Lithium’s Antofalla North project, alongside Albemarle

The company intends to apply the same strategy of drilling out prospects adjacent to major resources at its much larger Antofalla North project, located adjacent to Albemarle’s lithium exploration project in the Antofalla Salar.

Antofalla North is being targeted for first drilling later this year – as the company works toward a maiden resource at Rincon West.

The Antofalla salar is long and narrow, located 25km west of the Hombre Muerto salar, Argentina’s largest lithium-producing area.

The Antofalla Project is controlled by Albemarle Corp, the world’s second-largest lithium producer. Albemarle has previously stated publicly that the company controls one of the largest lithium resources in Argentina at Antofalla.

Here, Argentina Lithium controls Antofalla North, covering the basin adjoining Albemarle on the north side. The property covers 10,050 hectares, equivalent to 10 x 10 km – a substantial area.  Antofalla North is anticipated to be permitted for exploration programmes in the near term.

The company’s plan, when permitted, is to initiate geophysical surveys in anticipation of first drilling, if merited.

Additional concessions

Argentina Lithium also controls substantial concessions at the Pocitos Salar (approximately 20% of the basin), located south of Rincon, and the Incahuasi Salar in Catamarca province (approximately 90% of the basin), which lies in the valley adjacent to Lake Resources’ Kachi development project.**

Both the Pocitos and Inchuasi projects have the potential for lithium brine resources. Argentina Lithium is planning to advance them through the same systematic exploration process of geophysical surveys, target generation and drilling.

Several other companies are exploring the Pocitos Salar now. Results from these programmes could help guide Argentina Lithium’s work when the company is ready to move ahead.

The Incahuasi Salar in Catamarca has no exploration from others to use as a guide since Argentina Lithium, practically speaking, controls the entire salar.

What’s next for Argentina Lithium?

The Company has the potential for additional positive news in the coming months, given the locations of its lithium exploration projects in Argentina and its ongoing diligent exploration programmes. With lithium in high demand globally, the company provides an opportunity that speculative resource investors may want to follow closely.