2025 SMM South American Lithium Resources Field Trip – 7th Stop: Zijin Mining

In recent years, the significant fluctuations in lithium prices have subjected enterprises across the industry chain to a rollercoaster of experiences, encompassing both the highs and lows of the market. Although lithium prices have long since lost their former glory, the development prospects of the new energy industry chain remain bright under the advocacy of a global low-carbon economy, with the importance of lithium resources becoming increasingly prominent.

As one of the regions with the most abundant lithium resources globally, South America, particularly the "Lithium Triangle" region (Bolivia, Argentina, Chile), boasts over 55% of the world's proven lithium reserves. Consequently, South America's lithium resources play a pivotal role in the global energy transition.

Against this backdrop, SMM organized the 2025 SMM South American Lithium Resources Field Trip activity. Led by Chen Siyu, the project manager of SMM's overseas South American lithium resources field trip, and Zhou Zhicheng, a senior analyst in new energy and lithium batteries, the delegation visited South American lithium-related enterprises, toured local lithium ore and material companies, and held discussions with company executives from May 15 to May 26, 2025, to explore potential opportunities in lithium ore resource development, technological exchanges, and investment cooperation. On May 20, SMM and delegation members headed to Zijin Mining for in-depth exchanges.

Company Profile

SMM and delegation members visited Zijin Mining, where they were warmly received by a team led by Zhuang Rongchuan, the chief engineer of Zijin Mining's 3Q Project in Argentina, who provided a detailed introduction to the company's business development.

Zijin Mining Group Co., Ltd. (hereinafter referred to as "Zijin Mining") is a large multinational mining group engaged in the exploration, development, engineering design, and technological application research of metal mineral resources such as copper, gold, zinc, lithium, silver, and molybdenum on a global scale. It is listed on the Hong Kong H-shares (2899.HK) and Shanghai A-shares (601899.SH).

The company has significant mining investment projects in 17 provinces (autonomous regions) in China and 15 countries overseas, including the Julong Copper Mine and Junuo Copper Mine in Tibet, the Duobaoshan-Tongshan Copper Mine in Heilongjiang, the Zijinshan Copper-Gold Mine in Fujian, Shanxi Zijin, Guizhou Zijin, Longnan Zijin, etc. in China, and the Cukaru-Peki Copper-Gold Mine and Bor Copper Mine in Serbia, the Kamoa Copper Mine and Kolwezi Copper Mine in the DRC, the Rosebel Gold Mine in Suriname, the Buriticá Gold Mine in Colombia, etc. overseas. The company is accelerating its entry into the new energy and new materials industries, owning the 3Q salt lake lithium mine in Argentina, the Lakkor Tso salt lake lithium mine in Tibet, the Xiangyuan hard-rock lithium polymetallic mine in Daoxian County, Hunan Province, and has been invited to lead the development of the northeastern project of the Manono lithium mine in the DRC. As of June 2024, calculated based on a 100% equity interest in controlled enterprises and the equity interest in associated and joint ventures, the company's total proven, probable, and inferred resources stood at 104.67 million mt of copper, 3,528 mt of gold, 12.12 million mt of zinc (lead), 28,380 mt of silver, and 14.11 million mt of lithium (LCE).

Zijin Mining's lithium project in Argentina is located in the southern part of the country's lithium triangle. Compared with other well-known salt lake projects domestically and overseas, the composition of its brine resources differs significantly, particularly with a relatively high calcium content (approximately 5%). The lithium content in the project's salt pan brine is as high as 45-50 mg/L, with total lithium carbonate equivalent (LCE) resource reserves of approximately 1.8 million mt, sufficient to support a stable production capacity of 25,000 mt per year.

The project adopts the traditional evaporation pond process, removing impurities such as sodium, potassium, and calcium through long-term solar evaporation. Once the brine reaches the target concentration, it is further purified in the processing plant to produce battery-grade lithium carbonate. Meanwhile, the project is experimenting with the direct lithium extraction (DLE) method, hoping to find a better balance between price and energy consumption in the future. However, the traditional process remains the primary method at present.

It is reported that Zijin Mining's Argentine lithium project plans to produce 25,000 mt of lithium carbonate annually and will gradually commence production next month. It is expected to maintain an initial inventory of 3,000–4,000 mt to adjust production and market demand. In terms of product exports, the Argentine government implements an export price guidance policy for lithium products, and exports require third-party certification (such as SGS) to confirm product quality and price, ensuring fair trade.

On the cost control side, the project plans to optimize power generation costs through the operation of a PV power plant. It is expected that the proportion of power consumption in total operating costs will decrease from 30% to approximately 10%, thereby significantly improving profitability. In terms of capital expenditure control, a separated layout of the salt lake and the plant area is adopted to reduce infrastructure investment. Except for water treatment and power generation equipment, major equipment will be imported from China and assembled locally to shorten transportation time and enhance cost-effectiveness.

Whether the project will fully commence production in the future mainly depends on lithium price trends and the group's strategy. If the price of lithium carbonate remains at $9,000–$10,000/mt, the project will achieve a relatively high operating rate.

In summary, Zijin Mining's lithium project in Argentina has entered a critical stage of advancement. With a solid resource base, mature traditional processes, and a PV energy optimization plan, it demonstrates good profitability within an acceptable market price range. In the future, it will evaluate the feasibility of new processes such as DLE in a timely manner based on market and policy changes, and flexibly adjust production and export strategies to maximize investment returns.

After the field trip, SMM and the members of the delegation took a group photo together with Zijin Mining to strengthen their cooperation and friendship. It is believed that there will be deeper exchanges and cooperation in the future!

Through this field trip and survey, SMM and the members of the delegation gained a deeper understanding of Zijin Mining's development, as well as a more profound knowledge of the market status, development trends, and existing issues in the lithium battery industry in South America. They will continue to deepen cooperation with large enterprises to achieve complementary advantages and promote the development of the lithium battery industry.