Chile & SQM to initiate lithium talks by Q3 to increase state control

Chile & SQM to initiate lithium talks by Q3 to increase state control

The government of Chile and Chilean chemical firm, SQM, are reportedly set to initiate talks over its operations inside the Atacama Desert by the third quarter of FY23 to convince the lithium mining company, the world's No. 2, to ink a state-led public-private deal, the nation’s economy minister stated Monday.

According to reports, SQM has stated that it would need to make an additional investment of $2 billion as part of the newly proposed strategy.

Chile’s Economy Minister, Nicolas Grau, during his first interview to international media since the nation unveiled plans for state control of the metal key for EV batteries last week, stated that state mining firm, Codelco, would begin talks over public-private model of lithium production sooner rather than later.

Currently Codelco dominates Chile’s copper output, making it the globe’s top copper producer. Supposedly, the state is yet to start the production of lithium.

According to Grau, Codelco's talks with companies that operate within the Salar de Atacama, especially SQM, which is ending its contract in 2030, will begin immediately during the coming quarter.

In a later statement on Monday, SQM stated that the company met with the country’s state development office to talk over the lithium strategy. It further added that the firm would need to make an additional investment of $2 billion to attain the strategy’s sustainable goals.

Grau also added that progress is also expected with the world's leading lithium producer, US-based Albemarle Corp, whose contract is set to expire in 2043.

The Chilean government will begin hosting discussion with indigenous and local communities across the Atacama salt flats early on. The lithium projects are seeing strong opposition from some communities, but the government has clarified that it will raise production while taking good caring for ecosystems.

The minister further stated that almost all of the steps needed to implement the newly proposed lithium strategy would be implemented this year, however the establishment of a novel national lithium firm can take longer.

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