BUENOS AIRES, May 6 (Reuters) - Eramine Sudamerica is

set to inaugurate its first lithium carbonate plant in the

northern Argentine province of Salta this July, setting it on

track to become the South American country's fourth producer of

the key battery metal.

The group, owned by French miner Eramet and

Chinese steelmaker Tsingshan, expects to produce some 3,000 tons

this year and ramp up to some 24,000 tons by 2025, the company's

sustainability director Constanza Cintioni told Reuters in an

interview.

Lithium, which is used for batteries in mobile phones and

electric vehicles (EV), saw its price skyrocket over recent

years, before plunging in 2023 largely due to slowing EV sales

in China. Over half the world's known lithium resources are in

South America.

Argentina, located on the so-called "lithium triangle"

spanning Bolivia and Chile, is the world's fourth-largest

producer and has been drawing investment from foreign firms as

far as Canada and China.

This comes as libertarian President Javier Milei seeks to

shore up depleted foreign reserves with dollars from mining,

energy and grains exports, to battle the country's sky-high

inflation and its worst economic crisis in decades.

The Eramine Sudamerica plant is located on the Centenario

Ratones salt flat, some 1,400 kilometers northwest of Buenos

Aires and 4,000 meters above sea level.

Cintioni said its output will be 100% exported and it has an

expected useful lifespan of 40 years. She estimated a total

investment of some $800 million and said the firm plans to set

up a similar plant in the same basin at a later date.

The plant marks the first lithium carbonate plant in Salta

and joins three others in Argentina, where industry sources

estimate lithium exports jumped 20% last year.

There are two more projects in Jujuy province, a project by

Sales de Jujuy and Allkem located on the Olaroz salt flat, and

in Olaroz Cauchari a project by Exar, a firm owned by China's

Ganfeng and Canada's Lithium Americas ( LAC ).

The third project is on the Hombre Muerto salt flat in

Catamarca province, run by U.S. giant Arcadium Lithium ( ARLTF ).

Unlike other projects which extract lithium via brine

evaporation from pools, the Eramine Sudamerica plant will use a

direct extraction method.

"This is a much more efficient process," Cintioni said,

pointing to less need for brine pumping. "The level of lithium

recovery from the brine that is extracted is 90%."