Written by Ian Cardenas, Paralegal
In recent years, the global demand for lithium, a critical component in lithium-ion batteries powering electric vehicles and renewable energy storage systems, has surged. As one of the world’s leading producers, Chile stands at the forefront of this burgeoning market, boasting the largest lithium reserves globally. Recognising the economic and strategic importance of this resource, Chile has embarked on a bold initiative – the National Lithium Strategy. This comprehensive strategy not only aims to harness the nation’s lithium potential but also invites both domestic and international investors to participate in exploration and extraction projects through a transparent and structured process. In this article, we give the latest news on Chile’s proactive approach, highlighting the launch of the Request for Information (RFI) process and its implications for investors seeking opportunities in the lithium market.
Key developments
Through the National Lithium Strategy in Chile, an important step has been taken for investments, since it initiates the process for national and foreign investors to participate in exploration and/or exploitation projects, called RFI (Request for information) process.
On Monday, April 15, Chile’s Mining Minister, Aurora Williams, along with Treasury Minister Mario Marcel, and Economy, Development, and Tourism Minister Nicolás Grau, announced the initiation of a process inviting Chilean and foreign investors to express interest in developing one or more projects for lithium exploration and/or extraction from deposits in Chile.
The RFI process will span 60 days and aims to facilitate the design of efficient procedures for awarding Special Lithium Operation Contracts (CEOLs) based on current data.
As planned and in line with the announcement made in late March, we have today reached a new milestone in the National Lithium Strategy with the start of the RFI. It will allow us to define the lithium deposits for which the State will begin the process of awarding CEOLs, after carrying out an indigenous consultation process where applicable,”
– Minister for Mining, Aurora William.
Expressions of interest
Treasury Minister Mario Marcel made a point of inviting private parties to express interest in the process. “In this way, we’ll be in a position to identify which salt flats have the demand and potential for productive development, so that the process culminates in the awarding of Special Lithium Operation Contracts (CEOLs), including an indigenous consultation process in each case.”
Chile boasts the world’s largest lithium reserves, accounting for 36% of the global total. Projections indicate a sustained and positive growth trend in lithium demand. According to findings from a report by the Chilean Copper Commission (COCHILCO), there is an expected annual growth rate of 15.5% in the demand for this mineral. This growth is underpinned by the anticipated increase in the use of lithium-ion batteries, driven by the advancement of electromobility.
The National Lithium Strategy
The National Lithium Strategy is being spearheaded by the State, with a leading role for public sector corporations. Private entities will also participate in all projects, either as partners in salt flats with strategic value or by promoting their own exploration and extraction projects.
Domestic and foreign investors interested in participating in this process can download the terms and conditions at www.minmineria.cl, where they can also access the platform to submit their presentations of interest.
As agreed at the Strategic Council of the Lithium and Salt Flats Committee, some areas of the national territory will be excluded for this call for interest process. A detailed list of the salt flats that will not be part of the process is available at www.chileavanzaconlitio.
Schedule of key dates
- Start of the process: April 15, 2024.
- Consultation period via email (rfi@minmineria.cl): April 15 to May 17, 2024.
- Period for responses to queries: Maximum 10 business days from the closing of the consultation process.
- Submission of expressions of interest: Until June 17, 2024.
- Publication of the results of the RFI process: Until July 9, 2024.
Conclusion
Chile’s launch of the Request for Information (RFI) process under its National Lithium Strategy signifies a proactive invitation to national and foreign investors for lithium exploration and extraction projects. With robust government support and streamlined procedures, Chile aims to capitalize on its significant lithium reserves, representing 36% of the global total, amidst rising demand driven by lithium-ion batteries and electromobility. The strategy promotes public-private collaboration, offering transparent opportunities for investors to engage in strategic projects. Interested parties are encouraged to participate within the specified timeline, ensuring fair resource allocation. Chile’s proactive approach underscores its commitment to sustainable growth and innovation in the global lithium market, inviting investors to join in unlocking the full potential of its reserves for lasting prosperity.
