One of the world's leading automakers, Stellantis NV (NYSE:STLA, EPA:STLA) has invested US$90 million in Argentina Lithium & Energy Corp (TSX-V:LIT, OTCQB:PNXLF) subsidiary, Argentina Litio y Energía SA (ALE).
Argentina Lithium & Energy is focused on developing high-quality lithium projects in Argentina and moving towards production to meet the growing global demand of the battery sector.
The deal sees Stellantis subsidiary, Peugeot Citroen Argentina S.A., acquire a 19.9% stake in ALE and includes a seven-year agreement to supply up to 15,000 tonnes of lithium per year beginning in 2028.
This strategic investment is part of Stellantis' Dare Forward 2030 global plan, aimed at achieving a 100% battery electric vehicle (BEV) sales mix in Europe and a 50% BEV and light truck sales mix in the United States by 2030.
To meet its ambitious sales targets, Stellantis aims to secure approximately 400 gigawatt-hours (GWh) of battery capacity, including the support of six battery manufacturing facilities in North America and Europe. The company is committed to becoming a carbon-neutral corporation by 2038.
Antonio Filosa, President of Stellantis South America, highlighted the deal's role in the company’s sustainable mobility strategy, stating, "Lithium is an essential component in battery manufacturing and ensuring a stable and sustainable supply is fundamental to our success in this area globally."
Nikolaos Cacos, President and CEO of Argentina Lithium & Energy Corp also welcomed the partnership, emphasising the shared vision of delivering a sustainable lithium product that contributes to the electrification of mobility and environmental protection.
Stellantis’ Dare Forward 2030 plan, alongside the wider auto industry’s shift to electric vehicles, is a positive development for a number of ASX-listed lithium developers and explorers.
Given Stellantis’ 2030 electrification targets, the company still needs to secure supply of significant volumes of lithium.
Similar to the Frankfurt-listed ALE, a number of ASX companies have lithium projects in South America.
Piedmont Lithium (ASX:PLL, OTC:PLLTL)
Piedmont Lithium Ltd (ASX:PLL, OTC:PLLTL) Ltd is developing a world-class integrated lithium business in the United States. With the potential to be one of the world’s lowest cost producers of lithium hydroxide — a critical metal used to develop Lithium-ion batteries, it could prove important for EV makers such as Stellantis in meeting their US electric vehicle targets.
Latin Resources
Latin Resources Ltd (ASX:LRS, OTC:LRSRF) flagship Salinas Project is in the mining friendly Brazilian state of Minas Gerais, where a mineral resource estimate of 42.5 million tonnes at 1.34% lithium oxide with an exploration target of 22 million tonnes has been defined at its Colina Deposit.
The company's recent preliminary economic assesment (PEA) contemplates a proposed 3.6 million tonnes per annum standalone mining and processing operation over two phases, with an after-tax NPV8% of $3.6 billion and combined after-tax IRR of 132%. The PEA confirms the company could be a large-scale, low-cost producer of a fully integrated concentrate plant and environmentally sustainable production of high-quality 5.5% lithium oxide spodumene concentrate and a lower 3% spodumene concentrate, with significant cost saving benefits and competitive market advantages from its geographical location.
Based on the PEA, PAC Partners said the company is a “Buy” and placed a 50 cent price target on the stock — a decent premium to its current 28 cent share price.
Lithium Energy
Lithium Energy Ltd (ASX:LEL) is developing its flagship Solaroz Lithium Brine Project in Argentina, comprising 12,000 hectares of highly prospective lithium mineral concessions located strategically within the Salar de Olaroz Basin. The project has a minerals resource estimate of 3.3 million tonnes of lithium carbonate equivalent (LCE) in the same basin as Allkem and Lithium Argentina.
The company has a view to establish the project as a formidable lithium production facility within South America's Lithium Triangle and is currently forging ahead with metallurgical testwork programs to optimise lithium extraction and battery-grade lithium carbonate production.