Diversified mining company Rio Tinto has approved a $2.5-billion investment to expand the Rincon project, in Argentina – the company's first commercial scale lithium operation – demonstrating its commitment to building a world-class battery materials portfolio.

Rincon's capacity of 60 000 t/y of battery-grade lithium carbonate is comprised of the 3 000 t/y starter plant and a 57 000 t/y expansion plant.

The company says Rincon's mine life is expected to be 40 years, with construction of the expanded plant scheduled to begin in mid-2025, subject to permitting.

First production is expected in 2028 followed by a three-year ramp-up to full capacity, generating significant job creation and economic opportunities for local businesses.

"The attractive long-term outlook for lithium driven by the energy transition underpins our investment in Rincon. We are dedicated to developing this Tier 1, world-class resource at scale at the low end of the cost curve.

“We are equally committed to meeting the highest environmental, social and governance (ESG) standards, leveraging our advanced technology to halve the amount of water used in processing, while continuing to grow our mutually beneficial partnerships with local communities.

"Building on Argentina's supportive economic policies, skilled workforce and exceptional resources, we are positioning ourselves to become one of the top lithium producers globally.

“This investment, alongside our proposed Arcadium acquisition, ensures lithium will become one of the key pillars of our commodity portfolio for decades to come,” says Rio Tinto CE Jakob Stausholm.

Located in the heart of the 'lithium triangle' in Argentina, the Rincon project consists of brine extraction using a production wellfield, processing and waste facilities, as well as associated infrastructure.

The project uses direct lithium extraction technology, a process that supports water conservation, reduces waste and produces lithium carbonate more consistently than other methods.

Rincon is a large, long-life asset, with ore reserves 60% higher than Rio Tinto assumed at the time of acquisition. It is expected to be in the first quartile of the cost curve, demonstrating resilience and ability to operate profitably through the cycle.

Rio Tinto says this investment supports Argentina's ongoing ambitions to become a world-leading lithium producer.

The company notes that Argentina's economic reforms and the new incentive regime for large investments provide a favourable environment for investment, offering benefits such as lower tax rates, accelerated depreciation and regulatory stability for 30 years, protecting the project from future policy changes, as well as enhanced investor protections.