Against the backdrop of the global energy transition, Chile’s National Copper Company (Codelco) has entered into a framework agreement with SQM, the world’s second largest lithium producer. Under the agreement, SQM transfers a majority stake in its Atacama Salt Lake assets in Chile to Codelco in exchange for an extension of its operations for another 30 years to 2060. The move marks the Chilean government’s opening of a new model for lithium mining operations as part of its energy transition.
Codelco and SQM reached this landmark agreement after months of negotiations. Under the terms of the agreement, the parties will establish a new public-private partnership to advance production and investment in the Atacama Salt Lake. This partnership will help ensure the sustainable exploitation of lithium resources and promote Chile’s position in the global lithium market.
Chile’s Atacama Salt Lake is one of the world’s largest lithium mines, accounting for approximately 30% of the world’s total production. As the market for electric vehicles continues to expand, the demand for lithium continues to grow. Therefore, this extension of the mining agreement is important to ensure the stability of the global lithium supply.
The agreement also demonstrates the Chilean government’s commitment to the energy transition. As a pioneer among South American countries, Chile is actively promoting the goals of clean energy and sustainable development, and has made the lithium industry a key pillar of its future development. By partnering with Codelco and SQM, the Chilean government aims to ensure the sustainable extraction and utilization of lithium resources to support the country’s energy transition and economic development.
For SQM, this agreement is an important step in its growth strategy. As the world’s second largest lithium producer, SQM has a significant presence in the global lithium market. The partnership with Codelco provides a solid guarantee for the sustainable development of its business. This extension of the mining agreement will help SQM further expand its market share and enhance its competitiveness in the global lithium market.
In addition, this cooperation will also help promote the economic and trade relations between Chile and China. In recent years, China’s diplomatic and economic influence in Chile has gradually increased. Chile is an important trading partner of China in South America, and the economic and trade cooperation between the two countries has been deepening. The agreement will further consolidate the cooperation between the two countries in the field of lithium mining and promote the development of bilateral economic and trade relations.