Rio Tinto has acquired the Rincon lithium project in Argentina from Rincon Mining for $825m in a move that signals Rio’s intent to grow exposure to battery metals.
Rio Tinto have outlined a commitment to invest in the global energy transition to the Rincon acquisition demonstrates the delivery of their strategy.
“This acquisition is strongly aligned with our strategy to prioritise growth capital in commodities that support decarbonisation and to continue to deliver attractive returns to shareholders,” said Rio Tinto Chief Executive Jakob Stausholm.
“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.”
On completion of the acquisition, Rio Tinto will conduct studies on the mine to confirm the mineralisation at the project, as well as sustainability and environmental assessments.
Rio have said they propose to utilise direct lithium extraction technology at the mine as it improves lithium recovery when compared to other methods.
It is clear from Rio Tinto’s recent production report the mining group are still heavily weighted towards Iron ore having shipped 237 mt in the period September 2021 year-to-date.
Indeed, the production report didn’t include lithium production so Rio Tinto’s new acquisition will add a new metal to their reports in the future.
Rio Tinto are also working to develop the Jadar lithium-borates project in Serbia. Rio Tinto committed to a $2.4 billion financing of the Jadar project in July.
Rio Tinto reported a 118% increase in EBITDA in the six months to 30th June 2021 helped higher by a 71% increase consolidated sales revenue to $33 billion. Rio also declared a $5.61 dividend for the period.