BofA-European Metals Mining Weekly RIO ERA lithium site visit.TKA earnings...-20251215

RIO Postcard from Argentina: Lithium = High growth

We are in Argentina visiting Rio Tinto's Lithium assets and meeting with managementincluding Barbara Fochtman (Managing Director, Rio Tinto Lithium) and Ulric Adam (CFO,Rio Tinto Aluminium & Lithium). Key takeaways: 1) Capacity to grow to 200 kt by 2028.Based on Rio's consensus prices and guided 37% EBITDA margin, this implies revenue ofc. $2bn and EBITDA of c. $740m, vs 3.1% and 2.5% of BofAe, respectively. 2) RIO isbullish on the outlook for lithium demand and sees growth CAGR of c. 13% through2035. 3) Rio's resource position particularly in Brine is world class and underwrites amultifold increase in production. 4) Key investments going forward look likely to beconcentrated in Argentina and later Chile to take advantage of the world class resourceposition, plus attractive fiscal and investment terms from Argentina. 5) DLE or directlithium extraction, will be a key technology both for RIO and for the industry on a goforward basis. (See report: RIO)