POSCO Holdings Completes Acquisition of Argentine Salt Lake, Secures 15 Million Tons of Lithium

POSCO Holdings has completed the acquisition of a salt lake in Argentina, accelerating efforts to strengthen its global lithium supply chain.

Panoramic view of Hombre Muerto salt lake in Argentina. POSCO Holdings

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On April 7 (local time) in Buenos Aires, Argentina, POSCO Holdings announced on April 9 that, through its POSCO Argentina subsidiary, it had acquired 100% of the mining rights to the Hombre Muerto North salt lake owned by Canada’s Lithium South (LIS).

This acquisition follows the investment plan announced in November last year, with the purchase price amounting to approximately $65 million, or about 9.5 billion won.

The Hombre Muerto North salt lake is estimated to contain about 1.58 million tons of lithium and is considered a high-quality resource due to its high lithium content and low levels of impurities. With this acquisition, POSCO Holdings has secured a total of 15 million tons of brine-based lithium resources in Argentina, including its existing mining rights. Taking into account mining feasibility and yield, it is projected that at least 3 million tons of lithium can be produced, enough to manufacture approximately 70 million electric vehicles.

With this additional acquisition, POSCO Holdings expects to enhance the synergy from integrated development with its existing Hombre Muerto mining rights, as well as improve efficiency in development and operations. The ongoing operation of the first-phase plant, with an annual capacity of 25,000 tons, and the second-phase plant, scheduled for completion in the second half of this year, are expected to further solidify the foundation for expanding medium- and long-term production capacity.

Expectations are also rising for improvements in the local investment environment. POSCO Holdings is currently undergoing the approval process for 'RIGI (Investment Incentive Regime for Large-Scale Investments),' a major investment attraction program by the Argentine government. This policy is designed to attract large-scale investments in strategic industries such as energy, mining, and technology. Upon approval, it offers tax benefits such as corporate tax reductions and tariff exemptions.

Additionally, with the expected easing of foreign exchange regulations, including the gradual allowance for retaining export proceeds in foreign currency, the flexibility of financial management is also anticipated to increase. If approved under the RIGI program, POSCO Holdings will become the first Korean company to benefit from this regime.

Ju-Tae Lee, CEO of POSCO Holdings, stated, "With the additional lithium resources secured, we will further enhance our responsiveness to the global market and strengthen our supply chain competitiveness."

In a subsequent meeting with the Argentine Minister of Economy, Minister Luis Caputo stated, "POSCO Holdings’ lithium business is a leading example of fostering strategic industries and expanding investment in Argentina. We will continue to provide support to ensure that the project proceeds smoothly, including the prompt approval of the RIGI program."

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