Chile’s state-owned copper giant Codelco signed a deal on Friday with SQM to nearly double the private miner’s current output of lithium, a key mineral in the global transition to cleaner energy.
Codelco is the world’s largest copper producer and SQM is a leader in lithium, often called “white gold”.
The agreement calls for the creation of a public-private partnership “that will assume responsibility for the production of refined lithium in the Salar de Atacama from 2025 to 2060,” the companies said in a statement.
Salar de Atacama, in the desert of the same name, is a salt flat that holds the main deposits of the mineral in Chile, which is part of Latin America’s “lithium triangle” with Argentina and Bolivia.
Demand for lithium has grown sharply in recent years as the world tries to move away from fossil fuels to curb global warming.
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It is especially used in electric car batteries.
The companies will work together to mine an additional 300,000 tonnes of lithium between 2025 and 2030, with a target of producing 280,000-300,000 tonnes per year from 2031 to 2060, according to the statement.
In 2023, SQM produced 169,000 tonnes.
Chile’s leftist President Gabriel Boric took office with plans to create a national lithium company similar to state-owned Codelco, which was founded in the 1970s by nationalized mining companies.
Codelco will hold a 50 percent stake, plus one, in the new partnership, according to the press statement.
The Chilean state, he added, will receive about 70% of the operating margin generated by new production between 2025 and 2030 and 85% from 2031.
By 2016, Chile was the world’s largest lithium producer with 37 percent of the market, but by 2022 it was ranked second behind Australia with 243,100 tonnes of production – about 34 percent of the global total.
Source: AFP