The Origin of the “Lithium Triangle” and How It Is Extracted in Argentina

'White gold' is a key component in the batteries needed to advance the energy transition. Its high concentration in the Puna is due to a 'perfect storm' in geological terms. Its extraction in the country is more similar to that of an oil well than to a large-scale metal mine.

Why is the Lithium Triangle located in that corner of South America where Argentina, Bolivia, and Chile meet? Geological studies have shown that it was a 'perfect storm.' Its presence dates back millions of years. The extraction currently taking place in Argentina's salt flats resembles the technique used in an oil well rather than a gold mine.

Lithium is a vital resource for manufacturing batteries to drive the energy transition: moving away from fossil fuels responsible for the climate crisis and powering the global economy with more sustainable sources like solar and wind energy.

The batteries in our cell phones contain a few grams of lithium, but electric vehicles and the energy storage systems that will accompany wind and solar parks will require thousands of tons of this 'white gold.'

The Origin of the 'Lithium Triangle'

The main source of lithium in the Puna comes from its oldest rocks, a structure known as the crystalline basement, which is between 560 million and 400 million years old. These rocks have much higher lithium concentrations compared to the Earth's crust, as described in an article published in the scientific journal Mineralium Deposita. Link to the article

Although lithium is present in other parts of the planet, in the 'Lithium Triangle,' other geological phenomena 'brought' the metal closer to the surface, making it easier for people to extract it.

The Andes mountain range is in a very geologically active zone. Magmatic processes (molten rock rising) moved the lithium from this deeper basement to more superficial geological layers. Finally, erosion and the presence of hot springs extracted (technically: leached) the lithium from the rocks, and the white metal became an ingredient in the salt flats of the Puna.

'There must be a ‘perfect storm’; in addition to these basement rocks, there needs to be recent volcanism, a semi-arid region for a long period, and the existence of salt flats, which are closed endorheic basins. This is what all areas of the Lithium Triangle have in common,' explains Raúl Becchio, an independent researcher from CONICET, professor at the National University of Salta, and one of the authors of the study.

Lithium Reserves and Resources Worldwide

This process formed South America's vast lithium resources. However, it is important to distinguish between resource and reserve. Resources are an estimate of all deposits of a mineral or metal. Reserves are the calculated portion of those resources that can be extracted based on economic, technological, and environmental factors at a given time.

A portion of the resources can become a reserve if the price increases and/or technology is developed to extract it at a lower cost.

According to a report from the U.S. Geological Survey (USGS), Bolivia ranks first in the world in terms of lithium resources. Link to the report However, Bolivia's lithium-rich salt flats also contain high concentrations of magnesium, an element that interferes with the extraction of 'white gold' and makes the process more costly.

Today, the countries with the most reserves are Chile (9.3 million tons), followed by Australia (6.2 million tons) and Argentina (2.7 million tons), according to the USGS document.

Why Is It Called 'White Gold'?

It is known as 'white gold' due to its potential market price and its color. In 2010, the price of a ton of lithium carbonate was USD 5,180. By 2022, it had soared to USD 37,000. Source

Lithium is a lighter metal, and it is so soft that it can be cut with a knife. However, it is other, less curious characteristics that make it a key input for battery manufacturing. It is highly reactive, which gives it a high energy density despite being lightweight. In other words, it can store a large amount of energy in a small volume and weight.

How Lithium Is Extracted: Differences with Australia

Australia is currently responsible for more than 48% of the world's lithium production. The extraction operations in this country are more similar to those of a traditional mine. Lithium is obtained from rocks that have veins with high concentrations of this element in the form of lithium oxide (Li2O). This process involves tasks such as crushing, grinding, and leaching with chemical compounds. The material is then concentrated to remove impurities until pure lithium hydroxide (LiOH) is obtained, the component used in batteries.

Despite the economic and political stability of the country, the implementation of this extraction technique is quick. However, it requires a relatively low initial capital investment, although operating costs are higher. All these factors have allowed Australia to quickly position itself as the world's top lithium producer.

Chile ranks second, with 22% of the market. In Argentina and Chile, lithium is obtained using a process different from that in a traditional metal mine. It is more similar to what happens in an oil well because the first step is to pump brine (which usually contains 0.22% lithium) from a defined depth.

Once on the surface, the brine is placed in ponds to allow solar irradiation and wind to evaporate the water. This stage takes between 12 and 24 months. When completed, the concentration reaches 6%. This process slows down production and is the main difference from rock extraction.

During this process, lime and other chemicals are added to precipitate unwanted elements such as sodium, potassium, and magnesium. The next stage takes place in an industrial plant where the goal is to obtain lithium carbonate or lithium chloride with the required purity for battery manufacturing. This stage of the process is the most expensive, as it requires large amounts of soda ash and other inputs, along with large volumes of water.

However, the operational costs of these plants are lower than those of a traditional mine, but they require greater initial investment for building the facilities and more time to get them up and running before production begins. The extraction and purification processes vary for each salt flat and each project.

Mining is just the first step toward battery manufacturing. The term 'upstream' refers to everything that happens in the various stages of the extraction process (prospecting, exploration, extraction, and production). In this sense, the lithium 'boom' is just beginning (which can be linked to the previous article).

Meanwhile, 'downstream' refers to everything that happens from obtaining the lithium with 'battery-grade' quality to placing the battery in the final product.