Chile's state-owned copper producer, Codelco, together with Chinese-backed private miner, SQM, announced on Saturday the creation of a giant company to exploit lithium, often referred to as "white gold."
The South American country is the world’s second-largest producer of lithium, a key component of EVs and other clean technologies and has about 40% of the world’s lithium reserves.
The partnership between the firms will allow them to jointly ramp up the exploration of lithium in the Atacama region of northern Chile.
The public-private partnership will be named Nova Andino Litio SpA, said Codelco, which described the agreement as one of the most significant deals in Chilean business history.
The Chinese firm Tianqi holds 22% stake in SQM.
In a statement, Codelco said the new partnership will carry out lithium exploration, extraction, production, and commercialization activities in the Atacama salt flat until 2060.
The agreement was approved by more than 20 national and international regulatory authorities, including those in China, Brazil, Saudi Arabia, and the European Union.
Chile was the last of the countries to clear the deal. Last month, China gave the green light to the planned partnership between Codelco and SQM.
The new venture is intended to help Chile regain global leadership in lithium production, a position it lost to Australia nearly a decade ago.
The partnership aims to expand lithium output in the Atacama region, with plans to increase production by around 300,000 tons per year. In 2022, Chile produced 243,100 tons of lithium.
The partnership also aligns with Chile’s National Lithium Strategy, announced in 2023 by the leftist government of President Gabriel Boric, aimed at reclaiming Chile’s global leadership in lithium production.
