Although this contract expires in 2030, its relevance for the fiscal coffers and for the development of the industry has led companies to start their offensive for this strategic location.
Several companies producing lithium, batteries and even electric vehicles have explored their interest in participating in what may well be “the mother of all battles”: the concessions held by SQM in the Salar de Atacama, which expire in 2030. Of these, the North American companies Albemarle and Ensorcia Group (Sorcia Minerals) have been explicit: they want to participate in this process. “The Salar de Atacama has the highest concentrations of lithium in the world. In the event that it is opened to new players, of course we would be interested in entering,” said Rodrigo Dupouy, president for Latin America at Ensorcia Group. For its part, Albemarle said it would be open to participate in an open bidding process for these properties in the Salar de Atacama, contributing its direct extraction technology. Albemarle clarified that although they also have exploitation in this salar, their operation “is four times smaller than SQM’s”.
It should be noted that in January this company, together with Tesla – which is its client – met with representatives of the Foreign Ministry, Mining and Corfo, where they presented the technological change they are making in their lithium production in Chile in the Salar de Atacama. How much will Corfo’s renegotiation with SQM start? Those familiar with the previous process pointed out that in order to have operational continuity, it would be best to start soon, and other participants believe that it should begin around 2025. In any case, the participation of new actors is an issue to be defined. “It depends on the extraction technologies,” said an expert on the subject, since “the water issue is a serious problem”. Rodrigo Dupouy, president for Latin America at Ensorcia Group. Technological change Rodrigo Dupouy of Ensorcia Group said that “the most important thing is not who enters, but how they do it”.
He assured that “we cannot continue implementing the evaporation method, as we know that it generates a great water and environmental impact on these fragile ecosystems… At Ensorcia Group, with our Direct Extraction and reinjection technology, we would operate in a more efficient and environmentally committed way”, he emphasised. “If the Salar de Atacama is opened up to new players, we will be the first in line to operate it, as we believe we have the best technology to produce lithium,” he said. Something similar was stated by Albemarle, which will use desalinated water for its Salar de Atacama operation and is also investing US$650 million to increase lithium capture from brine and processing. SQM is pushing ahead with Salar Futuro But the current holder of the largest concession in the Salar de Atacama, SQM, has its sights set on 2030, for which it is developing a US$1.5 billion direct investment and a further US$700 million in indirect investment in the Salar Futuro project.
The initiative was announced in 2022 and consists of both the application of Advanced Evaporation Technologies (AET) for a significant part of the brine from the Salar de Atacama and the implementation of a new technology to extract lithium that increases the yield in the refining plants. In addition, it aims to reduce inland water use by 40% by 2030 and 65% by 2040 and to achieve carbon neutrality in lithium, potassium and iodine by 2030 and in all SQM products by 2040. SQM’s plan in Chile is to expand lithium capacity by 210,000 tonnes, including 100,000 tonnes of lithium hydroxide. Executive is open to changes
The Minister of Finance, Mario Marcel, and the Minister of Mining, Marcela Hernando, arrived yesterday, Tuesday, at the Senate Finance Committee to present the mining royalty project, indicating that after passing through the Mining Committee of the Upper House, the Executive is open to review certain modifications to the project in this instance.
In particular, the Secretary of State indicated that start-up costs could be reinstated as a cost for the calculation of the Adjusted Taxable Mining Operational Income, which would leave the calculation of mining operational income the same as it currently works with the specific tax.
On the other hand, and in view of the debate on the tax burden, the aim is to establish a limit to the potential tax burden, taking into account both the royalty and the income tax faced by companies.
“This would make it possible to dispel estimates or speculation that have been generated that the tax burden would be 60%, 70%, 80%, 120%, as was mentioned in a column. This would make it clear that this type of situation could not arise,”
Minister Marcel