SANTIAGO (Reuters) – With the global race to secure lithium heating up in 2016, Chile’s president Michelle Bachelet wanted to be sure her country seized the moment. Home to half the world’s lithium reserves, Chile tapping its state-run miner Codelco to ramp up production seemed a sure bet.
Chile’s most trusted public enterprise, she said, could hunt for private partners to help it mine its own lithium for the good of all Chileans, and take part in the global boom for the battery metal used to power electric vehicles.
A review of regulatory filings, court documents and interviews with Codelco officials shows the strategy was deeply troubled from the start. Dwindling support inside Codelco to prioritize lithium projects over copper, company insiders said, was compounded by legal and regulatory hurdles that stalled development of the company’s two flagship salt flats known as Pedernales and Maricunga.
As a result, Codelco has yet to find a partner for either project years into the initiative to boost output of the metal. Global automakers, meanwhile, are planning a $300 billion surge in spending on electric vehicle technology, including the vital battery technology, over the next five to 10 years.
Codelco’s projects, once thought a shoo-in to boost global supply and lower prices, have largely fallen off forecasts, and Chile has ceded its position as the world’s top producer of lithium to Australia.
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