Liontown Enters Argentina with Up to 100% Earn-In on Centenario Brine
Key Takeaways
- Liontown has executed a binding farm-in agreement with NEXT Lithium Corp. to earn up to 100% of the Centenario lithium brine project in Salta Province, Argentina, for up to US$40 million in project expenditure and US$140 million in milestone payments.
- The initial financial commitment is US$5 million cash plus US$10 million in LTR shares, with all subsequent phases optional until the 75% interest threshold is crossed — at which point Phase 4 acquisition becomes mandatory.
- Centenario sits in close proximity to established brine operations run by Ganfeng Lithium, Eramet, and Lithium Argentina, placing the project in one of the world's most proven lithium brine districts.
- A transient electromagnetic survey has already been completed across the project, with the initial 12–24 month, US$15 million work programme targeting identified anomalies through a drilling campaign.
- NEXT Lithium's founder previously co-founded Millennial Lithium, which was acquired by Lithium Americas in 2022, providing the partnership with direct precedent for building and monetising Argentine brine assets.
Liontown enters Argentina with up to 100% earn-in on Centenario lithium brine project
Liontown Limited (ASX: LTR) has executed a binding farm-in agreement with NEXT Lithium Corp. to earn up to a 100% interest in the Centenario lithium brine exploration project in Salta Province, Argentina. The deal opens a new growth frontier in lithium brine, complementing the company’s established hardrock Kathleen Valley Operations in Western Australia. The total financial commitment is structured around up to US$40 million (~A$56 million) in project expenditure over four years, plus milestone payments of up to US$140 million (~A$195 million). Initial consideration payable on completion comprises US$5 million (~A$7 million) in cash and US$10 million (~A$14 million) in Liontown shares.
Managing Director and CEO Tony Ottaviano
“This transaction gives Liontown a low-cost entry into lithium brine. Brine is one of the two primary sources of the world’s lithium, and this is our first step in building real understanding and capability in it.”
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A staged earn-in designed for capital discipline
The farm-in is structured across five stages, with Liontown’s capital commitment scaling progressively as the project proves itself. Each phase is optional except Phase 4, which becomes mandatory if Liontown reaches the 75% interest threshold.
- Initial Completion — Pay US$5M in cash plus US$10M in LTR shares (calculated by reference to Liontown’s 20-day VWAP) to secure farm-in rights.
- Phase 1 — Fund US$15M in project expenditure within 24 months to earn a 49% interest in Vertex Holdings (Argentina) Pty Ltd, NEXT Lithium’s Australian subsidiary which holds the project.
- Phase 2 — Pay further consideration of US$15M (in cash, Liontown shares, or a combination at NEXT Lithium’s election) within 90 days of earning the Phase 1 interest to increase to 51%.
- Phase 3 — Fund an additional US$25M in project expenditure over 24 months from the Phase 1 interest date to increase to 75%.
- Phase 4 — Upon reaching 75%, Liontown must acquire the remaining 25% for consideration of up to US$125M (cash, shares, or combination at NEXT Lithium’s election), determined by a resource-linked formula.
The Phase 4 payment is calculated at US$25 per tonne of lithium carbonate equivalent (LCE) for the first 3 million tonnes averaging more than 350 mg/l of lithium, and US$10 per tonne LCE for resource exceeding that threshold, capped at US$125 million. Liontown is not obligated to proceed beyond any phase it has already earned — except that completing Phase 3 makes Phase 4 acquisition mandatory.
| Phase | Interest Earned | Trigger | Cost | Consideration Form |
|---|---|---|---|---|
| Initial Completion | Farm-in rights granted | Satisfaction of conditions precedent | US$5M cash + US$10M shares | Cash + LTR shares (20-day VWAP) |
| Phase 1 | 49% | Fund US$15M project expenditure within 24 months | US$15M | Project expenditure |
| Phase 2 | 51% | Within 90 days of earning Phase 1 interest | US$15M | Cash, LTR shares, or combination (NEXT Lithium’s election) |
| Phase 3 | 75% | Fund additional US$25M expenditure over 24 months from Phase 1 date | US$25M | Project expenditure |
| Phase 4 | 100% | Mandatory upon reaching 75%; resource-linked formula | Up to US$125M | Cash, LTR shares, or combination (NEXT Lithium’s election) |
What is a lithium brine project?
There are two primary sources of the world’s lithium: hardrock deposits, and brine. Centenario is located in close geographic proximity to two established projects in the same district: the Pozuelos-Pastos Grandes project, jointly owned by Lithium Argentina and Ganfeng Lithium, and the Centenario-Ratones operation owned by Eramet.
For Liontown, adding a brine asset to its hardrock portfolio is a meaningful diversification.
The NEXT Lithium partnership and why it matters
The experience sitting behind this deal is a material part of its appeal. NEXT Lithium’s founder previously co-founded Millennial Lithium, an Argentine brine developer that was subsequently acquired by Lithium Americas in 2022 — a direct precedent for building and monetising exactly this type of asset in this jurisdiction.
Exploration groundwork is already underway. The initial US$15 million work programme planned over the first 12–24 months includes a drilling campaign targeting anomalies already identified by a transient electromagnetic (TEM) survey that has been completed across the project.
NEXT Lithium CEO Kyle Stevenson
“The Centenario Project is one of the last large-scale lithium brine exploration projects in Argentina. Partnering with Liontown provides the experience, technical capability and financial strength needed to advance Centenario and realise its full potential.”
NEXT Lithium will become a Liontown shareholder via the share component of the initial consideration, directly aligning the partner’s incentives with LTR’s own performance from completion.
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Investment thesis: portfolio diversification without distraction
The strategic case here rests on structure as much as location. Key points from the announcement include:
- Kathleen Valley remains the priority — this transaction is described as additive to Liontown’s strategy, not a change in direction.
- Low-cost entry: the initial outlay is US$15 million in cash and shares before any drilling commitment is required.
- Capital scales with results: expenditure commitments increase only as earlier phases are satisfied, preserving discipline across all stages.
- Staged optionality: Liontown can elect not to proceed beyond any phase already earned, except that earning 75% makes the final Phase 4 acquisition mandatory.
- World-class address: the project sits alongside assets operated by Ganfeng Lithium, Eramet, and Lithium Argentina in one of the most established brine districts globally.
- Experienced in-country partner: NEXT Lithium’s track record in Argentine brine exploration reduces technical and jurisdictional risk at this early stage.
- Conditions precedent expected to be satisfied shortly following execution of the Farm-in Agreement.
The initial 12–24 month work programme is focused on drilling the anomalies already identified by the completed TEM survey. This is early-stage exploration, and no assurance has been given that further work will identify economically viable mineralisation.
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