Argentina’s Pan American Energy joins oil industry’s push into lithium

Pan American Energy Group will dig exploratory wells in Argentina’s Andean salt flats by year-end, according to a person familiar with the matter, who isn’t authorized to speak publicly. The company was founded by the billionaire Bulgheroni family, which still owns 25% and keeps family members in the chairman and CEO roles. BP Plc owns 50% and China’s CNOOC owns the other 25%.

Pan American Energy’s exploration around the Dead Man salt lake in Catamarca province — part of South America’s lithium triangle — comes as oil firms globally start to diversify into the key component in electric-vehicle batteries.

In Argentina, it brings into focus efforts by local fossil fuel drillers to plant a flag in the country’s lithium extraction industry — the fastest-growing in the world — at a time when calls are getting louder to channel production into sophisticated homegrown manufacturing to supply battery and EV makers.

State-run oil firm YPF SA, mostly focused on unearthing Argentina’s shale riches, recently bought lithium acreage in Catamarca while spearheading national research and development of battery cells.

Buenos Aires-headquartered Pluspetrol SA continues to develop acreage after selling a project last year to China’s Ganfeng Lithium Group Co. Tecpetrol SA, another major shale operator that’s part of billionaire Paolo Rocca’s Techint empire, has been trying to buy a lithium asset in Salta province.

Pan American Energy’s other foray into lithium, on the Salinas Grandes salt lake straddling Salta and Jujuy, is struggling to progress because of a broader conflict in that region with local communities, the person said.

A spokesman for the closely held firm declined to comment on the Catamarca or Salinas Grandes projects.

Argentina has three lithium salt flats in production, with another five projects under construction and 31 more in advanced exploration or feasibility analysis.