Mining giant Rio Tinto (ASX:RIO) has entered into a binding agreement to acquire the Rincon lithium project from Rincon Mining for $825 million.
Rio said the acquisition demonstrates their commitment to build its battery materials business and strengthen its portfolio for the global energy transition.
With funds managed by Sentient Partners, Rincon is a large undeveloped lithium brine project in Argentina. The project is a long life, scalable resource capable of producing battery grade lithium carbonate, said Rio.
Once acquired, the Rincon project will be subject to the completion of studies to confirm the resource and define an Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, 2012 (JORC Code) compliant resource statement.
The direct lithium extraction technology proposed for the project has the potential to significantly increase lithium recoveries as compared to solar evaporation ponds, Rio said.
As the project is currently held through an Argentine branch of an Australian company, completion of the transaction is conditional upon approval by Australia’s Foreign Investment Review Board (FIRB). Subject to FIRB approval, the transaction is expected to be completed in the first half of 2022.
Shares in Rio Tinto (ASX:RIO) are trading 1.1 per cent lower at $100.30.