SQM, the second-largest lithium supplier in the world, is resuming operations in Chile after roadblocks on local communities were lifted on Sunday.
The blockades had restricted movement of workers and supplies at the Atacama salt flat for almost a week as authorities looked to soothe the concerns of locals who feared that plans to ramp up production of the precious metal would damage the environment.
The communities said they were not properly consulted when SQM and Codelco agreed to a deal that would see the two companies work together on projects in the Salar de Atacama salt flat for 35 years, starting in 2025. The increase in production will come under the government’s new public-private development model.
Codelco and SQM initiated roundtable discussions to try and mollify the concerns of local communities, guaranteeing protection of the nation’s ecosystem. The companies claimed that they recognised the international treaties signed by the Chilean Government, including Convention 169 of the International Labour Organization.
However, the discussion did not stop the roadblocks from going ahead, proving the difficulty of enacting President Gabriel Boric’s lithium plans.
According to data from Mining Technology’sparent company, GlobalData, Chile was the world’s second-largest lithium producer in 2023, producing 42,700 tonnes. However, the nation has been losing market share since production is currently limited to just two operators.
Chile’s operations have not been the most environmentally friendly either. Brine evaporation ponds are the predominant mode of extracting lithium in the South American nation.
Isabel Al-Dhahir, lithium analyst at GlobalData, said: “Chile is the second-largest producer of lithium in the world and certain regions suffer from intense droughts and water stress. Brine evaporation ponds have become a serious point of contention, especially among environmentalists that fear the destruction of the water table and natural ecosystems.”
