Chile outlines plan to double lithium production

Chile will use three different business models to expand its lithium production that it estimates could increase by 70pc by 2030 and 100pc over the next decade, finance minister Mario Marcel said.

Chile is the world's second-largest lithium producer with an estimated output in 2023 of 234,000 tonnes of lithium carbonate equivalent (LCE), according to US Geological Survey data.

The first model announced late on Tuesday envisages public-private alliances, with the state holding a majority share, in two salt lakes that have been defined as strategic: Atacama in the Antofagasta region and Maricunga in the Atacama region.

Public-private alliances will also be promoted in five other salt lakes — covering Pedernales and the Alto Andino project area — where the state will seek the "best agreement" to develop projects with private partners, giving it either a majority or minority role.

The third model gives the private sector leadership in the development of 26 other salt lakes in which associations may be formed with state companies but will not be a requisite, said Marcel.

Private investors will be asked to submit Requests for Information (RFI) to express interest in these salt lakes in April and the RFI results announced in July. Subsequent tender processes will lead to special lithium operating contracts (CEOL).

"During this government, we will sign a group of CEOLs in which the private sector will lead production in which the state will not be a major partner," said economy minster Nicolas Grau.

Another 38 salt lakes will be defined as protected areas where development cannot take place to meet Chile's commitments under the Convention of Biological Diversity.

Chile has the world's largest proven reserves of lithium but laws passed in the 1970s and 1980s restricted its access to private developers.

Chilean SQM and US Albemarle, the country's only producers, operate in the Atacama salt lake under leases with state development agency Corfo.

The plan comes almost a year after President Gabriel Boric announced Chile's intention to open lithium mining to private investment in April 2023 as part of its national lithium strategy.

By Emily Russell