Globally, progress towards electric mobility as a measure to reduce emissions and combat climate change is undeniable. The discussion, however, is focused in the speed of this changeboth for the public policies that promote it, and for the availability of critical inputs for the production of the main components.
When we talk about electromobility we usually refer only to the electric car, where the battery, one of its key components, is based, in part, on lithium products. However, e-mobility encompasses a much broader ecosystem, which includes not only mobility, but also its infrastructure, where Copper emerges as a fundamental and currently irreplaceable mineral.
According to the latest report published by the International Renewable Energy Agency, copper, lithium, nickel, cobalt and rare earths are critical components of many of today’s fast-growing clean energy technologies, from wind turbines to power grids to electric vehicles . Demand for these minerals is growing rapidly as clean energy transitions accelerate, facing value chains vulnerable to disruption due to their scarcity, geographic concentration, complexity in the extraction and refining process and/or lack of substitutes.
Argentina has latent potential in this field, but it has been affected by economic instability and long-term political inconsistency. Despite this, mining activity developed. Timidly. We currently have only 17 projects in operation of which 14 are gold and silver and 3 are lithium. Our macroeconomic uncertainty and discretion in the rules of the game represent the main impediment to activity, as it has slowed down investment decision-making regarding the advancement of large-scale mining projects and even lithium projects, hindering development of their potential.
At the same time, The demand for projects is greater due to our lack of infrastructure. Each mining project must contemplate the development of roads, installation of electricity networks, renewable energy, gas, logistics and multimodal nodes to ensure the functioning of the exploitation, work according to international quality standards and achieve the objectives of the 2030 Agenda. This implies greater pressure both in terms of investment value and time required for all off-site activities.
Although there are many challenges, the growth path has begun, at least in lithium. Globally, despite being among the top five producers, its production in 2024 (100,000 tonnes) is still below the second producer, Chile (180 thousand). There are currently six projects under construction, at different speeds, but in the production phase they will expand the supply of more than 100,000 tonnes of different lithium products.
This gradual but sustained growth translates into an increase in its participation in Argentina’s total mineral exports: in ten years it has gone from 1% to 18% of Argentina’s total mineral exports. the almost 4 billion dollars exported from the sector over the past year, which continues to be driven by gold and silver shipments.
However, copper exploitation in Argentina is far from its full potential. Since 2018, with the closure of Minera Alumbrera, we have not participated in the copper market even though we have significant reserves and world-class deposits. The main factor that penalized these large investments was the change in the rules of the game, including the law on mining investments.
This is why Argentina has allowed years of development to pass in which investments were diverted towards traditional producing countries. More than one project is approaching the construction phase, with average investments of $3 billion, implying strong demand for quality employment, development of supply chains with high standards to comply with international standards that qualify suppliers for being able to intervene in other chains with high demand, development of infrastructures with positive externalities in remote areas and change of the regional production matrix.
The large international players have set foot in Argentina, the portfolio of copper projects includes Josemaría (SJ), El Pachón (SJ), Mara (Catamarca) and Taca Taca (Salta) on the medium-term agenda, which together would constitute investments for more than 12,000 million dollars, but we must not lose sight of the good exploratory campaigns that included Los Azules (SJ), Filo del Sol (SJ) and Altar (SJ) in this list, followed by more than twenty projects in different states .
In the coming years, and hand in hand with electromobility, globally there will not be demand problems but rather supply problems. It is a great opportunity for Argentina to capitalize on investments seeking new projects in countries where traceability of operating conditions can be met.
Source: Clarin
