(Yicai Global) July 26 -- Shares of Jinyuan EP, a Chinese cement producer moving into lithium resources, jumped after the company said it plans to acquire the rights to develop part of a lithium brine mine in Argentina.

Jinyuan [SHE: 000546] closed up 4.1 percent at CNY18.55 (USD2.75) today, after earlier gaining as much as 7.3 percent. The stock has climbed more than 180 percent in the past 12 months as lithium salt prices have surged.

A unit of Jinyuan plans to spend USD2.5 million to buy Hancha, a company with the rights to develop a section of the Cauchari-Olaroz lithium brine project in Argentina’s northwestern Salta province, its Hangzhou-based parent company said in a statement late yesterday.

The unit will pay USD940,000 to obtain the rights to conduct exclusive due diligence on the section’s resources within 60 days, according to the deal it signed with Hancha. Based on the results, the unit will decide on the section’s future development and operation.

Jinyuan may invest USD50 million to USD100 million during the initial development stage to build a processing plant with an annual capacity of between 1,000 tons and 2,000 tons of lithium salts, it said

Salta is abundant in lithium brines, and many other Chinese lithium resource developers have acquired development rights in the province. Battery materials giant Ganfeng Lithium announced earlier this month that it planned to offer up to USD962 million to buy the company that owns the exploration and development rights to two lithium brines in Salta.

In recent years, Jinyuan has been expanding its business into developing and processing lithium salts. The firm took over a number of lithium brine developers in China’s western Tibet Autonomous Region and lithium salt processing projects in the country’s northwest in the second half of last year.

Editor: Futura Costaglione