Chile To Expand Lithium Production With New Atacama Lease
Chile has confirmed plans to enter a landmark lease agreement with lithium producer Sociedad Química y Minera de Chile (SQM), marking the state’s first major step into lithium production.
The deal centres on a joint venture between state-owned copper giant Codelco and SQM, which is expected to be finalised this year. Under the agreement, SQM will have a modified lease until 2030 for its current operations at the Atacama salt flat, one of the world’s richest sources of lithium, at which point the joint venture between the two companies will commence from 2031 until 2060.
The country’s economic development agency, Corfo, which manages mining rights in the Atacama region, announced that its board has approved the final version of the contracts. The last hurdle is approval from Chinese antitrust regulators as Chinese company Tianqi is one of SQM’s major shareholders.
The agreement, if and when finalised, would strengthen Chile’s position as the world’s second-largest lithium producer, behind Australia. Chile already accounts for about 24% of global production, and its reserves – concentrated in the “Lithium Triangle” that spans Chile, Argentina, and Bolivia – are among the largest and most extractable globally.
The move comes at a pivotal moment for the industry. Lithium is a critical material in the production of lithium-ion batteries, which power everything from smartphones to electric vehicles.
With demand surging worldwide, Chile’s expanded role in lithium production could reinforce its strategic importance in the global clean energy supply chain.
