Chile's government expects to surpass project target amid strong private sector interest

Company News

by Peter Milios

The Salar de Atacama in Chile contains some of the world's highest known concentrations of lithium and potassium. 

Chile's government has reported strong interest from private firms in lithium projects, indicating that it may surpass its goal of initiating three to four new projects by the end of 2026.

The government received 88 proposals from 54 companies and groups, according to a presentation by Mining Minister Aurora Williams on Tuesday. Nearly 60 of these firms are based in Chile, with the rest hailing from Canada (11), Australia (four), the United States (three), and China (two). The identities of these companies were not disclosed.

Finance Minister Mario Marcel commented, “The results of this process far exceed our expectations and open up opportunities for exploring lithium in previously unconsidered areas.” Marcel also emphasized that the government's approach to boosting production is not a move towards nationalization, contrary to some concerns.

This wave of interest comes despite a recent slowdown in electric vehicle (EV) demand, which has affected lithium prices. Chile, home to the world’s largest reserves of this crucial battery metal, is betting on investors' confidence in the long-term growth of EV demand, as the US and Europe seek to reduce their reliance on China for global supply chains.

Around 60% of the proposed projects are located in 16 salt flats, with over 80% of these proposals incorporating direct lithium extraction technology, which uses less water.

The next steps involve authorities selecting areas for indigenous consultations before determining the mechanisms for awarding contracts. This is part of President Gabriel Boric’s broader strategy to counteract Chile’s diminishing share of the global lithium market, currently confined to two operations in a single salt flat.

The government's strategy divides future projects into three categories. Two salt flats are designated as strategic, meaning future contracts will be under state control. In another two, state-owned companies will have the flexibility to negotiate terms with private partners. In the third category, companies will be able to manage projects independently or in partnership.

Peter Milios

Peter Milios is a recent graduate from the University of Technology - majoring in Finance and Accounting. Peter is currently working under equity research analyst Di Brookman for Corporate Connect Research.

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