In the world, as well as in Argentina, lithium represents a space of intense conflicts of interest. The actors involved are not minor: multinational mining and automotive companies, regional, national, and foreign governments, indigenous communities, non-governmental organizations, the media, and investment funds, among others, are all active players. An example of the extremes that can be reached is the interference, openly admitted by the owner of the multinational company Tesla, in the downfall of Evo Morales' government in Bolivia in 2020, due to interests in accessing the lithium of the Altiplano region.
As is common knowledge, the relevance of this element lies in it being a component of battery cells, which, due to their energy storage and delivery characteristics, enable significant technological developments such as computers, mobile phones, and electro mobility through electric vehicles.
But let's break it down. After all, lithium is relatively abundant on the Earth's surface (65 parts per million). It is only a matter of identifying where to extract it and at what cost. The country with the highest production in the world is Australia, which obtains it from a rock called spodumene.
Lithium dissolved during geological eras and concentrated in brines found in the groundwater of salt flats and the high Andean salt flats, mainly in the border area between Chile, Argentina, and Bolivia (the lithium triangle), has drawn attention in recent years due to its lower extraction cost.
Chile, the second-largest global producer, declared lithium a strategic resource in 1979 due to the content of isotopes, critical for the development of nuclear energy. Therefore, it was kept outside the traditional mining concession system and is managed through exploitation contracts.
In recent days, the government of President Boric presented a new national strategy for lithium that includes, among other measures, the creation of a national company that will intervene, with potential private partners, in the exploration, exploitation, and value-added activities.
Bolivia has always maintained a strong state presence in this matter. With numerous international partners that have changed over time, including the Koreans, Germans, and Chinese, the state has always been the key player.
In Argentina, the system follows the classic mining concession model. With some environmental safeguards and unclear consultations with indigenous communities, the provinces, as constitutional owners of the resource, grant exploration and exploitation permits. These authorizations remain valid as long as the permit holder continues with the extraction, and include any potential transfers by the company. The royalties paid are relatively small, and often national reimbursements to companies for exports exceed the revenue from fees and taxes.
Until the publication of this article, only two companies exploit this resource in the country, in the provinces of Catamarca and Jujuy. There are, however, several announced or developing projects.
It should be noted that the lithium salts produced have different production costs, ranging from the cheapest, called commercial or technical-grade carbonate, to battery-grade (99.5%) carbonate, lithium hydroxide, and others. Argentina exports some of these relatively cheap products, which, when further processed abroad, generate value and employment. Some transnational automakers then invite us to be proud of buying cars with "Argentine" lithium batteries.
Customs investigations into possible cases of under-invoicing of exports led the tax authority, AFIP, to establish a reference price in 2022, exclusively for battery-grade carbonate, of US$53,000 per ton. In 2023 the market value already exceeds US$60,000 per ton.
There are different legislative initiatives to include lithium as a strategic mineral, potentially following a similar path to Mexico, which has just nationalized it after a previous reform to the mining code.
The Argentine Mining Code, in a 1980 reform, established that "The Executive Branch, upon joint proposal from the Ministries of Defense, Economy and Public Works and Services, in coordination with the senior authorities of the Armed Forces, will periodically classify strategic mineral substances for the purposes indicated in this Code." However, this predates the constitutional reform of 1994, which determined Provincial ownership of their resources.
The National Government, within its attributions in foreign trade, does not apply rewards or penalties to promote the production and export of goods with the highest possible added value.
Y.Tec, a technology company created through a partnership between the national oil company YPF and the CONICET (National Council for Scientific and Technological Investigation), is currently developing a project to establish battery cell manufacturing plants. This demonstrates that, although in its early stages, Argentina could develop a virtuous value chain.
In 2019, the Council of Public Universities established the Interuniversity Forum of Lithium Specialists, composed of researchers from around thirty research groups in areas related to lithium and its connections to the Exact, Social, and Environmental Sciences. One of their demands is the incorporation of scientific input in the decision-making processes regarding the exploration, exploitation, industrialization, and commercialization of this element.
The Forum has insisted on the need for Argentina to establish a National Lithium Commission where workers, businesspeople, governments, scientists, and indigenous communities can debate and promote public policies for the sovereign utilization of this resource.
It is interesting to observe how a potential competition between different countries, such as China, the US, and European countries, to "access" Argentina's lithium, is taking place, without any consideration for national interests. This gives the impression that attitudes like those taken by Chile, Bolivia, and Mexico increase the perception, among companies and officials of more industrialized nations, that regulations in Argentina are more permissive.
The recent merger of two transnational lithium giants, Alkem and Livent, which have operations in Argentina, represents a development that should be analyzed for its potential consequences.
Meanwhile, in China, the development of vehicles powered by sodium batteries has already begun. How much longer will lithium remain the protagonist of the energy transition?
Rodolfo Tecchi is an Argentine biologist, specialized in ecology, regional ecology, nature conservation, and science and technology management. He served as the President of the Universidad Nacional de Jujuy and was President of the Consejo Interuniversitario Nacional.
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