Frequently asked questions

On 23 May 2023, the Chilean state, through Corfo, tasked Codelco with finding the best ways to achieve the state’s participation in the extraction of lithium and other mineral resources in the Salar de Atacama.

After evaluating different options, the decision was made to form a public-private partnership with SQM which is a Chilean company with over 25 years of experience producing lithium in the Salar de Atacama and has the scale, technical and human expertise, financial resources and commercialization network that the country needs to avoid missing out on the opportunities that the lithium market offers us today.

The agreement establishes in detail all the steps, stages, rights, obligations, terms and conditions of the public-private partnership that will take responsibility for production of refined lithium in the Salar de Atacama from 2025 to 2060. It distinguishes two periods of operation: the first, from the Effective Partnership Date until 31 December 2030; and the second, from 1 January 2031 to 31 December 2060.

The partnership, composed of Codelco through its subsidiary Minera Tarar, and SQM through SQM Salar, will become effective once all the contractual, technical and environmental legal requirements and the respective indigenous consultation process have been fulfilled, all of which is planned to be completed in the first months of 2025.

For production in the period 2031-2060, the agreement establishes that the companies will submit the project to the Environmental Impact Assessment System, including an indigenous consultation process regarding the environmental impacts likely to directly affect indigenous peoples.

If the indigenous consultation process is completed and a favorable Environmental Qualification Resolution (RCA) is obtained, the project should begin to be executed before the end of this decade, ensuring uninterrupted production through 2060.

Yes. The agreement states that the aim is to achieve a total additional production of 300,000 Lithium Carbonate Equivalent (LCE) per year in 2025-2030, while a production of 280,000-300,000 tons of LCE annually has been defined for 2031-2060. This increase in lithium production will be achieved through improvements in process efficiency, the adoption of new technologies and the optimization of operations. This increase does not entail increased brine extraction or use of continental waters.

No, the MoU expressly states that the higher levels of production will not lead to additional brain extraction from the Salar de Atacama, nor increased use of inland waters compared to current consumption.

New productive technologies will be implemented to reduce the use of brine from the Salar de Atacama and cut the use of inland water to zero, gradually reducing the evaporation of brines in bonds and replacing it with mechanical evaporation, in addition to incorporating direct lithium extraction technologies. In addition, the co-construction of socio-environmental governance mechanisms with indigenous communities in the area of influence is expected to take place.

The two companies are currently engaged in the dialogue process with Salar de Atacama communities to achieve their participation in all matters of common interest related to the joint venture’s productive activities, especially in socio-environmental matters, in line with International Labor Organization (ILO) Convention 169 on Indigenous and Tribal Peoples. This process of dialogue will extend beyond the signing of this agreement with the aim of reaching consensus on human development, socio-environmental and governance issues.

A long-term horizon is required for large investments like this. 30 years is common in mining projects and guarantees investment’s proper execution.

The entry of a new company without experience would create risks and could delay the project’s development, whereas SQM, with 30 years of experience operating in the Salar, has already implemented key technologies. The direct negotiation ensures continuity through 2060, avoids interruptions that could impact the environment, and allows the state to immediately benefit from existing infrastructure and established customer trust.

Several preliminary conditions must be met to form the joint venture.

• Indigenous consultation in Corfo.
• Permits from the Chilean Nuclear Energy Commission (CCHEN) and the Comptroller General of the Republic.
• Antitrust approvals in Chile and abroad.