China’s Zijin Mining Group is in advanced talks to build a plant in Argentina that will turn some of the nation’s huge lithium reserves into cathodes used to make electric-vehicle batteries.

Zijin has agreed to partner with Camyen, the provincial mining company of Catamarca — part of South America’s lithium triangle — and a unit of state-run energy firm YPF SA in the project, according to two people familiar with the matter who aren’t authorized to speak publicly.

The plant would produce 50 000 metric tons a year of lithium iron phosphate for cathodes, with operations set to begin as soon as next year, the people said. Zijin’s Tres Quebradas lithium mine in Catamarca is scheduled to come online in the fourth quarter.

A representative at Zijin didn’t reply to calls. Spokespeople for YPF and Catamarca didn’t respond to requests for comment.

An investment in the manufacturing of cathode material for batteries would be a big win for Argentina. The South American nation wants to propel itself along the electric-vehicle supply chain, turning its vast lithium deposits into a sophisticated domestic industry and avoiding a repeat of Latin American resource curses. The region’s history is full of examples of raw materials getting exported with little added value, putting a ceiling on investments and job creation.

The Zijin-led project would come at a time when the race to unearth South America’s lithium is throwing open a new front in the global tug of war between China and the US. The European Union has also been moving to secure regional lithium supply deals. Policymakers in Argentina have discussed a requirement to keep a portion of production in country for local processing, although that proposal has been shelved for now, the people said.

Among other Chinese investments in Argentina, Ganfeng Lithium Group Co. is the majority owner of Minera Exar SA, which recently became the South American country’s first lithium project in years to enter production. Ganfeng also spent almost $1-billion last year to acquire another Argentine project.

China has shown a willingness to help Argentina with its downstream ambitions. Chinese carmaker Chery Inc. wants to build a $400 million EV and battery plant in Argentina, while Jujuy province said it’s been in talks with suitors from China to make cathodes there. Across the Andes in Chile, Chinese electric-car juggernaut BYD Co. is also working on a cathode project.

Meanwhile, Argentina is trying to gain access to President Joe Biden’s new electric-vehicle tax credits despite not meeting the requirement of being a US free-trade partner.

Besides the cathode project with Zijin, Camyen and YPF have teamed up on exploration in Catamarca. Livent Corp. will supply lithium from the same province to a small-scale battery-cell factory run by YPF, which is spearheading the development of national battery expertise.