Lucila Sigal

Buenos Aires (Reuters) - The Argentine government on Tuesday approved the $2.5 billion lithium mining project by Anglo-Australian giant Rio Tinto, marking the first mining project under a new investment incentive regime.

According to approval from Rio Tinto's Rincon Project of Rio Tinto, the program was announced by the Rigi Incentive Program at a meeting in the capital Buenos Aires.

Since launching the Rigi program nine months ago, Argentina's mining industry has expressed concerns about the approval of seven projects submitted to the government.

"We are grateful for anxiety about what is happening in the mining industry," Roberto Cacciola, head of the Caem mining room in Argentina, said at the meeting. "This is the main news."

President Javier Milei's liberal administration wants to promote mining sectors in South American countries to introduce much-needed foreign currencies and keep the economy stable as the country faces painful inflation levels.

Argentina is the fourth-ranked lithium supplier in the world, forming the so-called "lithium triangle" along with Chile and Bolivia, which has the world's largest platinum reserves for electronics, electric vehicles and other key technologies.

South American countries also export gold and silver and have major copper projects in the pipeline, although no production is currently available.

Other companies applying for mining projects under RIGI program include Ganfeng in China, McEwen copper in Canada and POSCO in South Korea.

Five of these projects are used for lithium, while the remaining two are used for gold and copper respectively. However, although a decision must be made within a maximum of 45 working days, only projects in Rio de Janeiro are approved.

Industry sources say the government may not intend to cause delays, but it faces a complex approval process involving various state departments, and some companies may be rushing to apply at a premature stage to meet the criteria.

Reuters contacted several state agencies, but they did not immediately respond to requests for comment.

The RIGI framework aims to provide tax and customary benefits, and obtain international arbitration in the event of disputes and long-term stability plans.

Last year, Argentina exported $4.8 billion in minerals, mainly gold, followed by the transportation of silver and lithium.

(Reported by Brendan O'Boyle.