POSCO Launches Argentina's First Lithium Hydroxide Plant

In an exclusive breakfast with local journalists, POSCO, one of the world’s top five steelmakers, shared details about its innovative lithium hydroxide project in Salta, a development that positions Argentina on the global lithium production map. Salta Mining, a major media outlet in the region's mining sector, attended the event, highlighting the launch of the first lithium hydroxide plant in the General Güemes Industrial Park. This initiative marks a key milestone not only for the local mining industry but also for the economic growth of the province.

POSCO Argentina has officially announced its plans to inaugurate the first commercial lithium hydroxide production plant in Argentina, a historic event for the country’s mining industry. The inauguration ceremony will take place on October 24 at the plant in General Güemes, Salta province, with the presence of national and provincial authorities. Once operational, the plant will have a capacity of 25,000 tons per year, the largest lithium hydroxide production in the region.

"We have been based here in Salta for six years. In 2018, we acquired mining concessions in the Salar del Hombre Muerto. We began explorations and built a demonstration plant to test our extraction technology. After validating this technology, we started constructing the commercial lithium hydroxide and lithium phosphate plant in the Puna in 2022. The annual capacity will be 25,000 tons per year. Last year, in 2023, we started the second commercial plant, which will have a capacity of 25,000 tons of lithium carbonate. We expect to finish this commercial plant next year,” said a POSCO executive.

Although other mining companies in neighboring countries like Chile also produce lithium hydroxide, POSCO's plant will have a greater production capacity once operational, making it a reference in the industry within Argentina. POSCO Argentina has various strategic facilities, including the lithium hydroxide plant in General Güemes and administrative offices in the provincial capital.

Additionally, the second commercial plant, located between the provinces of Salta and Catamarca, is under construction. This plant will produce lithium carbonate, with an annual production capacity of 25,000 tons once completed. Meanwhile, in the Salar del Hombre Muerto, located 4,000 meters above sea level, POSCO operates commercial plants and a mining camp.

The plant to be inaugurated in October will exclusively produce battery-grade lithium hydroxide, an essential compound for manufacturing electric vehicle batteries, a globally expanding market. This type of facility is rare in Latin America, making the plant in Güemes a benchmark for technological innovation and sustainable production. While other countries in the region, like Chile, produce a mix of lithium carbonate and hydroxide, POSCO’s plant will focus solely on the latter, making it the first of its kind in the region.

With over 4,800 direct and indirect jobs during the peak construction of the two plants and collaboration with more than 60 local suppliers who generate additional jobs throughout the value chain, POSCO Argentina has demonstrated a firm commitment to the economic and social development of local communities, particularly in General Güemes and the Puna region.

POSCO began its venture in Argentina six years ago, in 2018, when it acquired mining concessions in the Salar del Hombre Muerto. Since then, it has continuously invested in the country, despite fluctuating lithium prices, which have reached highs of $65,000 per ton and, more recently, experienced significant drops. Unlike other companies that have scaled back or abandoned projects due to falling prices, POSCO continues to bet on Argentina and the region, consolidating its position as a key player in the global lithium market.

Beyond the economic impact of POSCO’s investment, the company has invested in and continues to invest in the social and educational welfare of the communities. To date, it has awarded 32 scholarships for middle and university students in Salta and the Puna, including youths from General Güemes, San Antonio de los Cobres, and Pastos Grandes, with the aim of reducing school dropout rates and improving academic performance in these areas.

POSCO has also financed student exchanges for senior engineering students to Korea’s prestigious POSTECH university and training programs in collaboration with the UOCRA Foundation to facilitate their entry into the labor market. A special training program exclusively for women is also noteworthy.

Among the standout community projects is the “Sumak Kawsay Project,” in collaboration with INTA and Mariano Moreno High School in General Güemes, which involves creating a greenhouse and garden. Students implemented a drip irrigation system and cultivated marigolds, extracting essence for cosmetic purposes. Additionally, in partnership with the Municipality of General Güemes and the Joaquin Castellanos Hospital, POSCO Argentina supports the Therapeutic Community Garden Program for people with addiction problems.

Since 2018, when POSCO Argentina acquired mining properties in the Salar del Hombre Muerto, the company has maintained steady progress in its operations. With the planned inauguration of the plant, POSCO will continue to strengthen its leadership in lithium production in Argentina and the region.

POSCO has also faced technical and logistical challenges in implementing its projects. The construction of the lithium carbonate plant, currently underway, experienced some delays due to environmental permits. However, executives assured that the plant would be operational by 2025, further boosting the group's production capacity in the region.

With the start of operations of the lithium hydroxide plant in Güemes, POSCO aims to establish itself as one of the world’s leading lithium producers, with a long-term strategy to reach a total production capacity of 100,000 tons annually. This strategy is divided into four phases: resource acquisition, technology validation, ensuring competitiveness, and finally, quantitative expansion. Currently, POSCO is in the third phase, focusing on producing key products such as lithium hydroxide and carbonate to meet the growing demand of the battery market.

The event concluded with a call for cooperation between the private sector and local authorities. “The success of the mining industry in Salta depends not only on companies but also on joint work with authorities and society,” POSCO representatives said, reiterating their commitment to the region and sustainable development. This project not only represents an industrial production advance but also a significant contribution to regional economic growth and Argentina’s integration into the global clean energy market.

POSCO continues to assess investment decisions for new phases of this critical project, subject to the evolution of global and local conditions and the application of the new incentive regime for large investments (RIGI).

The two plants currently under construction have not yet started operations, so they benefit from RIGI, and the company is working on the application process.