Chile, which owns the largest lithium reserves in the world, would be one step closer to becoming a manufacturing center for rechargeable batteries used in electric vehicles.
Our country hopes that manufacturers of batteries such as Samsung SDI and POSCO will start installing lithium processing plants in the country later in the year, according to Sebastián Sichel, Corfo Executive Vice President. The agency recently reached an agreement with the main lithium mining company, Albemarle Corp, which will give battery makers access to lithium cheaper.
"We want manufacturers to be increasingly close to producing a complete battery in Chile … this is our dream," said Sichel in an interview with Santiago. "We do not know if we will ever manufacture vehicles, but we would like to at least see that there are battery components in Chile, maybe even the battery complete."
Chile is the second largest lithium producer in the world, the fundamental mineral to operate the rechargeable batteries that use electric actuations. So far, you have only been able to export the raw ore to countries like China or South Korea, where most of the batteries are produced. But in the last two years, the government has tried to encourage manufacturers to refine and process lithium in Chile. The effort could be fruitful soon, Sichel said.
Corfo has signed contracts with the two miners operating in Salto de Atacama, which forces them to sell 25% of their production at a preferential price to the companies that convert lithium to Chile. By accepting this condition, in Albemarle and SQM, they awarded the highest production quotas they needed to meet the growing global lithium demand.
The agency will request offers from interested companies to buy the 25% SQM share at the end of March and expect to announce the winners at the end of the year, said Sichel. The process will be similar to what Corfo did in 2017 and 2018, when it launched an auction for battery manufacturers to compress the Albemarle lithium at a preferential price.
Although the winners of the first auction were announced almost a year ago, a disagreement between Corfo and Albemarle regarding the terms of the contract stopped the process. Now that the two parties have agreed to a formula to calculate the preferential price, the company will have to negotiate the precise terms of the sale of lithium with each company, said Sichel, adding that it is expected that the construction of refining plants of lithium will last approximately one year.
The winners of the auction, Molymet, a consortium of Samsung SDI and POSCO and Sichuan Fulin Industrial Group of China promised to invest more than $ 750 million in facilities. They will convert lithium salts, known as lithium carbonate and lithium hydroxide, into lithium cathodes, a purer form of this white material.