Maricunga lithium partner search is highly competitive, Codelco says: LME Week

Maximo Pacheco said in an interview during the annual London Metal Exchange industry week that in the meantime, the state-owned mining company was progressing permitting and pre-development work for the properties, located in Chile’s Atacama region, in order to avoid any delays.

The company chose Rothschild bank to help identify and select a partner to create a joint venture in which Codelco holds a majority stake of 51%.

“We have received a number of initial proposals from serious industry participants, and we are in the process of evaluating these proposals with the view to shortlist parties for further new diligence in due course,” he said.

“The process remains highly competitive, and we are very pleased with the level of interest we are seeing in partnering with us,” he added.

The plan is to select one partner, not multiple, Pacheco noted.

“It is customarily and expected by all participants that while the process is being run, we keep the identity of the participants and their proposals confidential,” he added.

The process is part of a plan by Chile’s government to boost the country’s lithium production. 

The company is also working to complete the various legal, regulatory, technical and environmental requirements, along with the respective indigenous consultation process, for its partnership with Sociedad Química y Minera de Chile SA (SQM).

The partnership was initially announced in a Memorandum of Understanding released in December 2023. It will be implemented through a joint venture in which Codelco will own 50% of the shares plus one, and will have two periods of operation: from the date the partnership becomes effective through December 31, 2030, during which SQM will oversee general management; and from January 1, 2031 to December 31, 2060, during which Codelco will oversee general management.

Starting in 2031, the state will receive 85% of the operating margin of the new production through payments to the Chilean government agency Corfo; taxes; and the profits received by Codelco as a shareholder.

“I am very pleased about the progress that we’ve made, and we continue to be very positive about the idea of finalizing the approvals and other actions during next year,” Pacheco added.

Fastmarkets most recently assessed the spodumene, min 6% Li2O, spot price, cif China at $800-820 per tonne on Tuesday October 2, down from $1,000-900 per tonne at the start of the year.

In Hotter Commodities, special correspondent Andrea Hotter covers some of the biggest stories impacting the natural resources sector. Sign up today to receive Andrea’s content as it is published.