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According to work by the World Bank, lithium production will increase six-fold, which is why they identify priority infrastructure works to respond to growth. The role of trains, routes and ports.
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The growth of lithium mining in the coming years in the northwest provinces Argentina (NOA) will demand the completion of infrastructure works aimed at improving and expanding the road and railway network, and promoting multimodality in a beneficial process for other relevant industries in the region, according to a report prepared by the World Bank.
The projections of the lithium industry in Catamarca, Salta and Jujuy allow us to estimate that the production of the mineral will increase six-fold by 2026, going from the 37,500 tons recorded at the end of 2022 to a volume of 260,000 tons that are estimated due to the incorporation of projects and expansions, with sustained growth for the remainder of the decade.
In this growth, two mega mining projects that will enter into production are of great importance, such as Taca Taca, in the province of Salta, and Minera Agua Rica Alumbrera (Mara), in Catamarca, in addition to other metalliferous initiatives that are underway and in analysis stage.
Liljana Sekerinska, Senior Transportation Specialist at the World Bank, explained that "with the growth of mining and other productive sectors, infrastructure demands will increase, which requires projecting road and rail flows to 2045," in order to direct efforts to facilitate NOA growth transformation through infrastructure requirements.
To take advantage of the synergy that can be generated around lithium, the report proposes the creation of economic corridors that encompass other sectors, based on the fact that the mining resource and the expansion of its value chain could "increase the gross regional product of the NOA by more than 10%, with an increase in tax revenues by a similar amount, and would increase regional employment by up to 6.5%.
Thus, by addressing the road, rail, energy and logistics infrastructure needs of lithium "other mining industries, such as copper, and the activities of agricultural and livestock areas that depend on the same national corridors towards the main ports of Argentina would benefit." », not only due to the output of production but also due to the flow of extra-regional inputs, explained the World Bank specialist.
Also added to this point is the positive impact that the growing tourist activity can achieve in the three provinces of the NOA, since the development of road infrastructure will facilitate access to towns and points of interest in a safer way, even coexisting in sections with the transportation of loads.
Based on this work, the report stated that road and rail transportation are the predominant modes of cargo transportation within the NOA, and that the most common route for lithium extends from the port of Campana, passing through the National Route ( RN) 34 that goes to Jujuy, then RN 66 that goes to Perico and, finally, RN 9 towards Purmamarca.
But in this framework there are several challenges: «The region has a lower density of routes than the national average, and their condition is usually fair or bad. "Logistics costs in northern regions have been estimated to be up to 50% higher than in neighboring regions, due to connectivity and quality deficiencies."
«In most lithium projects, sections of provincial routes and roads that are located in the remote Puna and are gravel will be used. The Belgrano railway network is the backbone of the NOA railway system and its condition remains heterogeneous, with several sections currently out of operation, and a considerable part of the operational lines that are in a poor or fair condition," the specialist detailed.
The growth of the network poses other challenges taking into account that both mining projects and other activities such as livestock agriculture require accessibility in the so-called "last mile" taking into account the little or no road coverage to each of the projects. , which must be complemented with secondary roads.
World Bank proposals
Given this state of the situation, the priority works identified by the World Bank propose improving the quality of the routes based on a detailed feasibility evaluation of the main routes (national routes 34, 9, 51 and 52; and the provincial ones 70, 17, 27 and 129); and update road maintenance approaches to account for the increased loads expected for the mining industry.
It is also promoted to rehabilitate and modernize the C14 branch of the Belgrano railway based on a detailed feasibility study so that all stations are operational and achieve an annual load capacity of at least 400,000 tons per year.
Furthermore, it is proposed to develop efficient multimodal nodes with dedicated railway lines; road access, loading/unloading capacity; cargo tracking; cargo security measures; and modernize the General Güemes logistics node, in terms of platforms, train loading, storage availability, connectivity within the broader area.
This opens the opportunity to reduce the pressure on the routes by transferring part of the volumes to the railway, and - according to the WB analysis - more than a third of the lithium inputs could use this modality, which would increase the load on the C14 branch of the Belgrano.
In total, it is estimated that cargo related to the mining sector could represent almost 48% of all NOA railway cargo in the next 15 years, far exceeding 50% if future copper inputs and production are considered.
Finally, the choice of export port will impact lithium infrastructure needs.
Depending on the destination, for certain volumes, the terminals in Chile or Buenos Aires are preferred, which will determine which sections of the NOA transportation network will be the most relevant.
This eventually opens up the need to interpret global maritime developments and changes in ship calls at ports in recent years, and adapt eventual cross-border crossings and cargo capacity in the various alternative ports.
Financing must be coordinated between the national and provincial governments and with the companies that have operations in the different productive activities, as was recently agreed to make possible the contribution of three mining companies for road and electrical works, but also with the contribution of multilateral organizations such as the World Bank itself. |
