International investors, including from Saudi Arabia, eye lithium mining in Argentina

International investors, including from Saudi Arabia, eye lithium mining in Argentina
Above, a scientist handles a lithium cell in Berisso, Buenos Aires on Oct. 18, 2022. Argentina currently has 39 lithium exploitation projects, some of them in very initial stages and five or six others ready to be launched in the next three years. (AFP file photo)
Short Url
Updated 29 February 2024
Follow

International investors, including from Saudi Arabia, eye lithium mining in Argentina

International investors, including from Saudi Arabia, eye lithium mining in Argentina
  • Earlier this month, a delegation from the Kingdom visited Catamarca province to discuss lithium projects in the area
  • Lithium mining has become a central element in several countries’ strategy to transition from fossil fuels to renewable energy

SAO PAULO: Lithium mining has become a central element in several countries’ strategy to transition from fossil fuels to renewable energy.

Saudi investors are aware of Argentina’s major role in this respect. Earlier this month, a delegation from the Saudi Energy Ministry visited the province of Catamarca, in the extreme north of Argentina, in order to discuss lithium projects in the area.

The Argentinian northwestern zone, along with parts of Chile and Bolivia, form the so-called Lithium Triangle, an area in the Andes where more than 50 percent of the world’s lithium deposits are located.

Chile has been leading lithium exploitation in the region, with the first projects beginning in the 1980s. Argentina started exploitation there in 1997.

“Argentina’s installed capacity today is lower than Chile’s. But the Argentinian exploitation model allows for the free entry of investors, while in Chile and Bolivia there are a few restrictions,” Victor Delbuono, a natural resources researcher at Argentinian think tank Fundar, told Arab News.

With the electromobility boom in the past decade, new lithium endeavors were implemented in Argentina, with an operation starting in 2015 and another in 2023, besides dozens of exploitation initiatives.

“There are now five mining projects under construction, funded by capital from several nations: France, South Korea, Australia, Canada, the US, Japan and China,” Delbuono said.

Chinese investors are taking part in a number of projects and, in the medium term, half of all running lithium endeavors will be under Chinese control.

Over the past decade, Argentina has concentrated most of the world’s expenditure in lithium exploitation, “so the country’s potential is rather well-known considering pre-feasible and feasible projects,” Delbuono said.

According to Diego Cons, executive director of the Argentine Chamber of Mining Suppliers, there are currently 39 projects in the country, some of them in very initial stages and five or six others ready to be launched in the next three years.

“Potential investors need to have access to reliable information on the ground in order to decide whether they want to invest in more advanced projects or new exploratory endeavors,” he told Arab News.

Delbuono estimates that there are 15 projects in the northwest of Argentina that have the necessary characteristics to be funded by Saudi investors.

“It’s possible for them to invest in joint operations with province-owned companies, for instance,” he said.

Jorge Pena, a consultant in energy transition at Lithron, told Arab News: “Catamarca’s lithium deposits have ideal geological characteristics to be exploited in the short term, but some projects in the region require subsoil exploration, which demands more capital — something Gulf nations could be interested in financing.”

He emphasized that opportunities are not restricted to lithium, given that other minerals are needed when it comes to electromobility.

“In that same region, there are consolidated endeavors to exploit copper, gold, silver and other minerals,” he said.

The growing lithium exploitation will also require the development of local infrastructure, Delbuono said, especially transmission lines and roads.

Pena said mining companies are the ones making the necessary investments in infrastructure, “but many things have to be done, including gas pipelines to provide fuel to such projects. The necessary development of the mining industry requires surrounding infrastructure, so investors are needed.”

The logistical infrastructure projects have been drawing the interest of groups from neighboring Brazil, analysts say.

With adequate modeling, investors can find juridical safety and fund such initiatives, Cons said, adding: “All that cycle generates direct and indirect jobs and boosts local development, something that creates more opportunities for companies that provide goods and services and are strategic partners of the foreign investors.”  

While there are several positive aspects for potential investors in lithium projects in Argentina, some elements still need to be tackled.

In recent months, Jujuy province has faced continuous protests by Indigenous groups, peasants and other social segments over the approval of a new provincial constitution that is seen as tailored to benefit lithium mining to the detriment of local residents.

The demonstrators fear that the scarce water in the region will be diverted to the lithium plants and will not be adequately available for them anymore.

“Each region has its own social and environmental reality. In provinces where mining is a traditional activity, there’s less resistance from residents,” Delbuono said, adding that sustainable development and operations properly accompanied by citizens must be the goal for all companies and investors.

“An institutional strengthening is needed, with governments adequately monitoring all operations and ensuring that the best practices are adopted.”

He said the governments of the three northwestern provinces of Argentina with the largest lithium deposits have been implementing measures to allow the operations to be adequately developed.

The country’s macroeconomic situation — which has been unstable over the past few years, with high inflation and debt — is also a challenge.

However, as financial hardships made access to credit more difficult and expensive, the entry of new foreign investors could represent a win-win situation.

All things considered, Argentina could become the center of the energy transition process. “All the development around lithium that there is in Chile is also possible on the other side of the border, in Argentina. And this is the right moment to pursue it,” Pena said.


Oil Updates – prices stabilize, Middle East tensions remain in focus

Oil Updates – prices stabilize, Middle East tensions remain in focus
Updated 2 min 58 sec ago
Follow

Oil Updates – prices stabilize, Middle East tensions remain in focus

Oil Updates – prices stabilize, Middle East tensions remain in focus

NEW DELHI: Oil prices edged higher on Tuesday, after falling in the previous session, as investors continued to assess the risk from geopolitical concerns in the Middle East, according to Reuters.

Global benchmark Brent crude oil futures traded 18 cents higher at $87.18 a barrel by 9:34 a.m. Saudi time, and US West Texas Intermediate crude futures also gained 16 cents to $82.06 a barrel.

Both benchmarks fell 29 cents in the previous session on signs that a recent escalation of tensions between Israel and Iran had little near-term impact on oil supplies from the region.

“The unwinding of geo-political risk premium has dented crude oil prices recently as supply was not disrupted meaningfully,” said Sugandha Sachdeva, founder of Delhi-based research firm SS WealthStreet.

But the evolving geopolitical landscape remains critical in steering crude oil prices, she said.

“While there are no indications of an imminent full-scale war between the countries involved, any escalation in tensions could quickly reverse the current trend,” Sachdeva added.

ANZ analysts echoed the sentiment and highlighted US approval of new sanctions on Iran’s oil sector that broaden current sanctions to include foreign ports, vessels and refineries that knowingly process or ship Iranian crude.

Also, EU foreign ministers agreed in principle on Monday to expand sanctions on Iran after Tehran’s missile and drone attack on Israel, the bloc’s foreign policy chief Josep Borrell said.

“The geopolitical backdrop is still very fraught with so many risks at the moment, so clearly we’re going to see a lot of volatility until there’s a lot more clarity around it,” the ANZ analysts said in a podcast.

Israeli troops fought their way back into an eastern section of Khan Younis in a surprise raid, residents said on Monday, sending people who had returned to abandoned homes in the ruins of the southern Gaza Strip’s main city fleeing once more.

Investors are waiting for the release of the US gross domestic product figures and the March personal consumption expenditure data — the Fed’s preferred inflation gauge — later this week to assess the trajectory of monetary policy.

US crude oil inventories are expected to have increased last week while refined product stockpiles likely fell, according to a preliminary Reuters poll of analysts.

“Sticky US inflation figures, hawkish statements from key Fed officials, and rising US inventories are all acting as constraints on crude oil price growth,” Sachdeva said. 


Pakistan hopes to get new IMF loan by early July, says finance minister

Pakistan hopes to get new IMF loan by early July, says finance minister
Updated 23 April 2024
Follow

Pakistan hopes to get new IMF loan by early July, says finance minister

Pakistan hopes to get new IMF loan by early July, says finance minister
  • Pakistan’s current $3 billion financial arrangement with IMF expires in late April
  • Islamabad is seeking “bigger,” long-term loan to ensure macroeconomic stability

Pakistan is hoping to reach a staff-level agreement with the International Monetary Fund by June or early July, its finance minister said on Tuesday.

The country’s current $3 billion arrangement with the fund runs out in late-April, which it secured last summer to avert a sovereign default.

Islamabad is seeking a long-term bigger loan to help bring permanence to macroeconomic stability as well as an umbrella under which the country can execute structural reforms.

“We are still hoping that we get a staff-level agreement by June or early July,” Finance Minister Muhammad Aurangzeb told a conference in Islamabad.

He returned from Washington last week after leading a team to attend the IMF and World Bank’s spring meetings. “We had very good discussions in Washington,” he said.

He said he did not know at this stage the volume and tenure of the longer program.


Riyadh prepares to host special meeting of World Economic Forum

Riyadh prepares to host special meeting of World Economic Forum
Updated 22 April 2024
Follow

Riyadh prepares to host special meeting of World Economic Forum

Riyadh prepares to host special meeting of World Economic Forum
  • The aim of the gathering is to find solutions to global challenges relating to humanitarian issues, the climate and the economy

RIYADH: Final preparations are taking place this week in the Saudi capital, Riyadh, for a special meeting of the World Economic Forum in the city on April 28 and 29.

Heads of state and senior executives from the public and private sectors are expected to be among the participants, who will discuss a range of global economic issues and developments under the theme “Global Collaboration, Growth and Energy for Development.”

The aim of the meeting is to find solutions to a host of global challenges relating to humanitarian issues, the climate and the economy. On the sidelines of the main event, the Kingdom will host exhibitions and other events to highlight the latest developments and trends in areas such as sustainability, innovation and culture.

The selection of Riyadh as host of the special meeting reflects the extensive partnership between Saudi Arabia and the WEF, officials said.

It builds upon the Kingdom’s active participation and contributions to the WEF’s Annual Meetings in Davos.

The agenda is designed to rekindle the spirit of cooperation and collaboration with various panel discussions, workshops, and networking opportunities. It represents a significant gathering of global leaders and experts dedicated to forging a path toward a more resilient, sustainable, and equitable world.


ACWA Power inks deal to drive renewable energy development in Azerbaijan 

ACWA Power inks deal to drive renewable energy development in Azerbaijan 
Updated 22 April 2024
Follow

ACWA Power inks deal to drive renewable energy development in Azerbaijan 

ACWA Power inks deal to drive renewable energy development in Azerbaijan 

RIYADH: Saudi energy giant ACWA Power is signing a new agreement to accelerate the development of renewable projects in Azerbaijan. 

The private water desalination company, known for its extensive green hydrogen storage capacity, announced it has now finalized an agreement with SOCAR, the State Oil Company of the Azerbaijan Republic.

This development follows an initial cooperation understanding signed in February 2023.

This deal focuses on the joint evaluation of the “Low-Carbon/Green Fertilizer” project, in which the two bodies will collaborate on assessing the production of green hydrogen to support the decarbonization of SOCAR downstream assets.

Marco Arcelli, CEO of ACWA Power, said in a statement, “I am proud to announce our collaboration with SOCAR to ignite a new era of renewable energy development in Azerbaijan. With our shared vision and commitment to sustainability, this partnership will not only drive innovation but also pave the way for a cleaner and brighter future for this country.”

The primary directive of the agreement will be to enhance SOCAR’s carbamide fertilizer facility, striving toward more value-added low-carbon products.

As part of the project, SOCAR and ACWA Power will conduct feasibility studies to assess the potential production and sale of green fertilizers, aligning with Azerbaijan’s vision of achieving a clean environment.

ACWA Power will take a role in driving the project’s renewable energy and green hydrogen production aspects, bringing their expertise to bear on this initiative.

For his part, Anar Mammadov, vice president of SOCAR, said, “Azerbaijan is committed to building a sustainable future, and our partnership with ACWA Power underscores our shared dedication to driving renewable energy development in the region. Together, we will work towards realizing our vision of a cleaner, greener Azerbaijan.”

He added: “The cooperation with ACWA Power represents a significant step forward in Azerbaijan’s transition towards a low-carbon economy and underscores the commitment of both organizations to sustainable development practices.” 

Preceding this announcement, the two nations posed their intent to collaborate on renewables as Saudi Arabia’s Minister of Energy Prince Abdulaziz bin Salman met with Azerbaijan’s Minister of Environment and Natural Resources Mukhtar Babayev in March.

During the meeting, the counterparts discussed opportunities for work and cooperation between their two countries in the field of climate change. 

They also talked about joint efforts to achieve the goals of the UN Framework Convention on Climate Change and the Paris Agreement, the Kingdom’s ministry said in a statement at the time.


Closing Bell: TASI edges down to close at 12,509 points 

Closing Bell: TASI edges down to close at 12,509 points 
Updated 22 April 2024
Follow

Closing Bell: TASI edges down to close at 12,509 points 

Closing Bell: TASI edges down to close at 12,509 points 

RIYADH: Saudi Arabia’s Tadawul All Share Index closed at 12,508.93 points on Monday, losing 9.29 points or 0.07 percent. 

The parallel market, Nomu, also shed 343.96 points or 1.28 percent to end the day’s trading at 26,596.22. 

Concurrently, the MSCI Tadawul 30 Index fell 3.95 points or 0.25 percent to finish at 1,567.16. 

The main index posted a trading value of SR8.8 billion ($2.3 billion), with 74 stocks advancing and 148 declining. On the other hand, Nomu reported a trade volume of SR37.7 million. 

Al-Rajhi Company for Cooperative Insurance was the top performer on TASI as its share price surged 9.93 percent to SR126.20. LIVA Insurance Co. followed next with its share price jumping 9.92 percent to close at SR21.50. 

Gulf General Cooperative Insurance Co.  also performed well, climbing 9.16 percent to SR16.44. Raydan Food Co. and Fitaihi Holding Group increased 8.14 and 8.11 percent to SR28.55 and SR4.40, respectively. 

Conversely, Saudi Cable Co. recorded the most significant dip, declining 4.94 percent to SR75. 

Alkhaleej Training and Education Co. and Ash-Sharqiyah Development Co. also experienced setbacks, with their shares dropping to SR31.50 and SR23.40, reflecting declines of 4.83 and 4.10 percent, respectively.

Nomu’s top performer was Dar Almarkabah for Renting Cars Co., which saw a 9.73 percent jump to SR44. Mayar Holding Co. and Alqemam for Computer Systems Co. also recorded notable gains, with their shares closing at SR4.27 and SR89.80, marking an increase of 7.02 and 5.03 percent, respectively. Arabian International Healthcare Holding Co. and Foods Gate Trading Co. also fared well. 

On Nomu, Raoom Trading Co. was the worst performer, declining by 7.28 percent to SR135. Other underperformers included Natural Gas Distribution Co. and National Environmental Recycling Co., whose share prices dropped 5.58 percent and 5.23 percent to SR42.30 and SR12.32, respectively. 

Watani Iron Steel Co. and Future Care Trading Co. declined during the day to settle at SR2.81 and SR8.70, respectively.