(Bloomberg) -- Chile has identified new lithium areas that will be offered to the private sector as authorities attempt to tap more of the world’s biggest reserves of the battery metal, despite a current glut in the global market.
Seventeen months after unveiling its strategy for lithium, President Gabriel Boric’s government unveiled six new brine deposits that proceed to consultations with local indigenous communities. Firms can then bid for contracts, although groups holding existing exploration permits over at least 80% of an area can opt to apply directly, Mining Minister Aurora Williams and Economy Minister Nicolas Grau said in a presentation Thursday.
The areas were identified based partly on expressions of interest from prospective bidders. Chile is banking on investors taking a long-term view on the strength of electric-vehicle demand as prices stabilize from a sharp pullback and the nation’s rich deposits offer low production costs.
Currently, only two companies produce lithium in Chile — SQM SA and Albemarle Corp. — from a single salt flat. Under Boric’s public-private model for the sector, the state will take a controlling stake in operations considered strategically significant, while allowing private firms to retain control of projects in non-strategic areas. The government wants to more than double output over the next decade.
The first batch of non-strategic areas are the following: Coipasa, Ollague, Ascotan, Piedra Parada, Agua Amarga and Laguna Verde. Other areas will be announced next quarter, the government said Thursday.
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