S&P/ASX 200 Index (ASX: XJO) resources goliath Rio Tinto Limited (ASX: RIO) is rumoured to be scouting for lithium buys, with some of the market's favourite shares named as potential targets.
It comes just months after fellow mining giant BHP Group Ltd (ASX: BHP) made an $8.3 billion play for copper miner OZ Minerals Limited (ASX: OZL). The once-takeover target is expected to benefit from the global decarbonisation and electrification movement.
As are ASX lithium shares, with such expectations potentially drawing the eye of the iron ore monolith.
The Rio Tinto share price is up 1.3% right now, trading at $96.89. Meanwhile, the ASX 200 is posting a 1.7% gain.
Let's take a closer look at the buzz surrounding Rio Tinto on Friday.
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Is Rio Tinto eyeing ASX lithium shares?
Rio Tinto is believed to be on the hunt for lithium buys, unnamed sources told The Australian.
ASX 200 favourites including Pilbara Minerals Ltd (ASX: PLS), IGO Ltd (ASX: IGO), Allkem Ltd (ASX: AKE), Core Lithium Ltd (ASX: CXO), and Liontown Resources Limited (ASX: LTR) are all said to be possible contenders.
Even $13.4 billion materials company Mineral Resources Limited (ASX: MIN) is reportedly a potential target. It recently confirmed it was considering, among other things, its own lithium spin off.
Though, such acquisitions would likely be costly. The ASX 200 lithium shares have surged as much as 38% so far this year. Only the share prices of Liontown and Lake Resources have recorded year-to-date losses.
Their gains came amid expectations demand for lithium will surge, likely driving the material's price higher in coming years.
It hasn't been all that long since the market heard news of a lithium acquisition from Rio Tinto. It bought the Argentinian Rincon lithium project for US$825 million late last year.
The ASX 200 giant has since approved the development of a battery-grade lithium carbonate plant at the project. The starter plant will have 3,000 tonnes of annual capacity, with its first saleable production expected in 2024.
It also follows the Serbian government's decision to revoke permits for the company's $2.4 billion Jadar lithium-borate project.
Finally, Rio Tinto shares provide exposure to lithium from the company's Boron mine. A demonstration plant is producing battery-grade lithium from waste rock at the project.
