Rio Tinto’s Lithium Leap: Why Maricunga is a Buy Now for Energy Transition Plays

The global energy transition is not just about wind turbines and solar panels—it’s a race for the raw materials that power them. Lithium, the backbone of electric vehicle (EV) batteries, is now the ultimate “new oil,” and Rio Tinto’s $850 million+ Maricunga Lithium Venture in Chile positions it as a critical minerals leader. With high-grade reserves, a 2030 production target, and a regulatory green light by early 2026, this venture is a rare convergence of strategic leverage, ESG compliance, and analyst optimism. For investors, this is a buy now opportunity to secure exposure to one of the most critical supply chains of the 21st century.

The Maricunga Advantage: High-Grade Lithium at Scale

The Salar de Maricunga is no ordinary lithium deposit. With brine lithium concentrations among the world’s highest—exceeding 500 mg/L—the project boasts the potential to produce lithium carbonate at a cost far below the industry average. Rio Tinto’s 49.99% stake in the joint venture with Codelco, Chile’s state-owned mining giant, combines the former’s capital and global reach with the latter’s local expertise. The partnership’s $350 million initial investment for feasibility studies and resource analysis (escalating to $500 million for construction if approved) underscores confidence in its economics.

By 2030, the venture aims to deliver first production, aligning perfectly with the International Energy Agency’s prediction of a 40% lithium demand surge by 2030 as EV adoption accelerates. With regulatory closure expected by Q1 2026, the timeline is aggressive but achievable, leveraging Chile’s strategic policy of state control over lithium assets while inviting foreign capital.

ESG as a Competitive Moat

The Maricunga project is as much about sustainability as it is about supply. Rio Tinto’s use of Direct Lithium Extraction (DLE) technology reduces water consumption by 50% compared to traditional evaporation ponds, a critical advantage in Chile’s arid Atacama Desert. Shared infrastructure with Codelco’s adjacent Nuevo Cobre copper project—including power grids and water management systems—further lowers the environmental footprint while slashing costs by 15–20%.

This dual focus on resource efficiency and community engagement (e.g., job creation and infrastructure investments) has already drawn praise from ESG analysts. As institutional investors increasingly demand climate-aligned portfolios, Rio Tinto’s target to achieve carbon-neutral operations by 2040 and its leadership in closed-loop water systems position it to attract ESG-driven capital.

Analysts See Upside: A Stock Poised to Outperform

Analysts are bullish. Jefferies recently reaffirmed a “Buy” rating on Rio Tinto’s stock, with a 12-month price target of $73—a 16.8% upside from its May 2025 price of $62.50. While the lithium venture wasn’t explicitly cited in early 2025 ratings, its May 2025 announcement and $850M+ capital commitment will likely bolster future valuations.

The case for outperformance is clear:
- Supply Chain Security: The U.S. and EU’s push for “friend-shoring” of critical minerals favors projects in stable jurisdictions like Chile.
- Cost Leadership: High-grade deposits and DLE technology ensure margins remain robust even as lithium prices moderate.
- Synergy Power: Shared infrastructure with Codelco’s copper projects reduces execution risk and operational costs.

Risks and Mitigants

Regulatory delays in Chile and water scarcity remain risks, but the state’s majority stake (via Codelco) ensures alignment with national priorities. Technically, DLE’s scalability is unproven at this scale, but Rio Tinto’s R&D investments and partnerships with tech firms mitigate this.

Why Buy Now?

The Maricunga venture is a “build it and they will come” moment. With lithium prices projected to average $18,000/tonne by 2030 (per Benchmark Mineral Intelligence) and EV battery demand tripling by 2027, Rio Tinto is securing a stake in a market that will only grow more concentrated.

The stock’s current valuation—trading at 8.5x EV/EBITDA versus peers’ 10–12x—leaves room for re-rating as production nears. Pair this with its 2.2% dividend yield (vs. 1.8% for peers) and the clarity of its 2030 timeline, and the case for buying Rio Tinto today is compelling.

Conclusion: A Lithium Play for the Decade

Rio Tinto’s Maricunga venture isn’t just about lithium—it’s about owning a piece of the energy transition’s infrastructure backbone. With ESG compliance baked into its DNA, a fortress balance sheet, and analyst support, this is a rare opportunity to invest in a company poised to profit from both the lithium boom and the shift to sustainable mining. For long-term investors, now is the time to act.

Rating: Buy
Price Target: $73 by mid-2026
Risks: Regulatory delays, lithium price volatility

Data visualizations and further analysis available via Bloomberg Terminal or Refinitiv Eikon.