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Eramine Sudamerica is Eramet’s subsidiary responsible for managing the company’s lithium mining and extraction activities in the region.
Eramet and Tsingshan had previously partnered on the Centenario project, beginning construction of a lithium carbonate extraction plant in October 2021 after a successful pilot plant run since 2019. The facility, inaugurated in July 2024, has a nameplate capacity of 24,000 tonnes per year of battery-grade lithium carbonate.
The plant will begin production in the coming weeks, the company said.
The purchase of Tsingshan’s stake in the Centenario lithium project in Argentina is interesting in numerous ways, Fastmarkets’ head of base metals and battery research William Adams said.
“The decision to regain full ownership of this project shows a Western miner is still confident in the project despite the current weak prices, and why wouldn’t it be? The oversupply and price weakness are temporary, the world is going down the green transition route and as more things are electrified or more renewable power generation is added, demand for energy storage is only going one way,” Adams said.
“The bigger the whole industry becomes, the harder it will be for producers to keep up with demand. Western companies need to compete with Chinese companies to ensure sovereignty. This deal increases Western sovereignty as well as gives Eramet full control over how the operation expands,” he added.
The Centenario lithium project is equipped with advanced direct lithium extraction (DLE) technology for efficient and sustainable production, which gives the operation commercial advantages, as well as the chance to roll out future operations in regions where mining or evaporation ponds would not be viable, according to Adams.
DLE involves the selective extraction of lithium from lithium-rich solutions and sources, such as brines, and bypasses the need for evaporation ponds, allowing for faster extraction rates, lower water consumption and a reduced environmental impact.
“DLE extraction at Centenario allows lithium production from brines in five days with a 90% yield, so it is more efficient and faster than getting lithium units from hard rock — which is more energy intensive — or via evaporation, which can take 12-18 months and generally yields 40-60%. This will mean supply responses can be quicker and greener,” he said.
“If Eramet’s DLE technology is proven to work, then it should put it in prime position to apply the technology in other jurisdictions where there are brines that can only be extracted by DLE methods,” he added, noting that Europe is an example of such jurisdictions due to its population density and heavy rainfall, which make large evaporation ponds commercially unviable.
“DLE is more environmentally acceptable too, as they tend to have a relatively small footprint compared with an open pit spodumene mine,” Adams said.
Several companies are using or aim to use DLE technology in their lithium extraction processes, including China’s Tianqi, US companies Standard Lithium and Compass Minerals, and Canada’s E3 Metals.
Australian mining firm Rio Tinto has also bought into DLE operations recently. The company signed a definitive agreement to acquire US-listed Arcadium Lithium, a company with DLE expertise at its Salar del Hombre Muerto project in Argentina.
Eramet’s Centenario lithium project sits within Argentina’s Centenario and Arizaro salars, which contain one of the world’s most significant lithium brine reserves, with a total estimated resource of over 15 million tons of lithium carbonate equivalent (LCE). Eramet estimated this will support a long-term production capacity exceeding 75,000 tpy of LCE.
The acquisition, which comes amid historically low lithium prices, doubles Eramet’s share of production and enhances its flexibility to expand its lithium asset portfolio. Eramet plans to reassess the scope and timing of future capacity expansion, which is planned to double every five years for the next two decades due to the growing EV market, the company said.
“Eramet placed its first plant at Centenario project in the lowest quarter of the cash cost curve, with a post ramp-up cash cost of $4.50-5.00 per tonne of LCE. But they first need to prove that level is achievable by producing battery-grade material, in commercial volumes, at a steady rate,” Adams said.
Battery grade lithium carbonate prices have been highly volatile in the last few years.
Fastmarkets’ daily assessment of lithium carbonate 99.5% Li2CO3 min, battery grade, spot prices, cif China, Japan & Korea was $10.00-11.25 per kg on October 28, the lowest level since April 2021 and down from all-time highs of $80-82 per kg in November-December 2022.
Eramet acquired the minority stake in Eramine Sudamerica for a net cash impact of $699 million. The company said it now holds 100% of the offtake rights, and already has a deal to jointly market around 50,000 tonnes of lithium with trading house Glencore.
Separately, Eramet also announced it was suspending plans to build a battery recycling project in Europe, “pending a solid and sustainable economic model [in the continent].”
Fastmarkets has more than 150 years of specialist commodity expertise. As well as our thousands of metals prices, we have two benchmark lithium prices, both launched in 2017: lithium carbonate and lithium hydroxide. Fastmarkets also offers two market-leading spodumene prices. Find out more here.