India has sent a team of three geologists to Argentina “to assess potential lithium deposits” and possible acquisition opportunities in the Latin American nation.

The team comprising one geologist each from Mineral Exploration Corporation Ltd (MECL), KABIL (Khanij Bidesh India Ltd) and the Geological Survey of India (GSI) has been sent to the Argentinian province of Catamarca on November 20.

“The team of geologists will be there for 15 days to carry out the exercise of assessing feasibility of lithium reserves in Argentina’s Catamarca province. The mine are owned by the provincial government there,” Vivek Bharadwaj, Secretary, Union Ministry of Mines, told businessline.

Based on their feasibility report, another team would be sent to the province for carrying out possible commercial negotiations, he said.

Those in the know say the three-member team’s feasibility study would cover aspects like determination of lithium resource, deciding on whether mining would be commercially viable or not and so on. “This is just a preliminary work. The team has to find out if the resources are worth investing or not at all. Other details will be decided later,” Bharadwaj added. India does not have any lithium resource of its own and the mineral is primarily imported.

However, demand – globally as well as in India — is being driven by a shift towards electric vehicles (EVs). Globally, consumption is expected to rise from 500,000 tonnes in 2021 to 3-4 million tonnes as per various trade reports.

Lithium is the key component of batteries and other electronics including in rechargeable batteries (used in EVs) and energy storage solutions. While Australia is among the top six producers on the mineral globally. The other five are Bolivia, Argentina, Chile, the USA and China.

Boom in Argentina

Lithium is found in cedemine rock formation and in brine form which is called salar in Argentina, Bolivia and Chile. The other alternative is liquid form. Last year, Argentina and Chile produced about 30 per cent of the world’s lithium. The three nations, considered as the ‘lithium trinity’, together account for over 50 per cent of the world’s resource.

In South America, lithium is typically extracted from the salt flats by pumping brine into ponds and processing the lithium salts that crystallise once the water has evaporated. It requires time and investment to set up, but thereafter production is cheaper than the hard-rock mining practiced in Australia, those in the know said.

Argentina is already witnessing substantial investment in the sector from international players, including China-backed firms.