Chile aiming to reclaim global market share with large-scale lithium exploration tender

Chile is set to open an exploration tender for around 400,000 tonnes of lithium as it looks to boost its flatlining production levels for the valuable battery metal.

The South American nation holds the world’s largest known lithium reserves and was a global leader in production until 2018, when Australia ascended to top spot.

Now, with China projected to become the second largest producer by the end of the decade, Chile has moved to reclaim market share with the new exploration tender. Chile’s Mining Ministry said it is preparing bidding rules available to local and foreign firms for five quotas of 80,000 tonnes each.

Companies that secure permits will have seven years, extendable for another two, to explore and develop projects, followed by 20 years of production.

Chile currently generates about 29% of global lithium supply, but plans to double production by 2025 to about 250,000 tonnes of lithium carbonate equivalent, in line with rapidly increasing demand projections for the metal.

According to the ministry, global demand will quadruple by 2030, reaching 1.8 million tonnes of lithium. Available supply by then is expected to sit at 1.5 million tonnes.

In recent years, the national sector’s growth plans have been stunted by environmental objections to the process of extracting lithium from Chile’s Atacama Desert. The world’s top two lithium miners – Albemarle and SQM – utilise large amounts of local water resources to pump brine from beneath surface and concentrate it through evaporation in pools.