Chile open to all paths to lithium mining, Minister says

3rd June 2022

By: Reuters


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SANTIAGO – Chile's Mining Minister on Thursday said the country was open all paths to develop its lithium reserves and would work to rebuild trust after its supreme court voided two contracts for the battery metal because of opposition from indigenous groups.

The supreme court on Wednesday accepted appeals filed by indigenous communities against two contracts granted during the last months of the previous administration to exploit 160 000 t of lithium.

Chile is the world's no. 1 copper producer and second largest lithium producer, but while its copper output is dominated by the giant State-run Codelco, the state has yet to produce lithium.

Minister Marcela Hernando told a news conference the government "is not closed to tenders or any path", including private partners as Chile lacks technical ability to exploit its lithium, she said.

"We are going to do everything in our power to build an institutionality around lithium that allows us to recover the trust," she added, referring to the impact of the failed tender.

In the ruling, the highest court found that, since the tender did not specify the areas to develop for the lithium projects, it was not possible to carry out the consultations with indigenous communities required by law.

The tender was suspended in January, two days after it was announced that China's BYD and Chile's Servicios y Operaciones Mineras del Norte would be awarded two of the five contracts offered for more than $120-million.

As the development of electric vehicles across the world drives demand for lithium, the government of President Gabriel Boric has promised to have the business and operating model of a National Lithium Company, which could have private participation, ready by the end of the year.

"We don't have the time we would need to learn as a country without the support of a strategic partner," mining undersecretary Willy Kracht said.

The government could partner with any of the different companies that expressed interest in the suspended lithium tender, Kracht said.

"The expectation is that by the end of the government we will be able to produce at least one pound of state lithium," he added.

Edited by Reuters



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