Chilean Senator Proposes Government Control of Lithium Deposits
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By Matt Craze and Michael Smith
Sept. 30 (Bloomberg) -- A Chilean senator is urging the country to take control of its lithium deposits as demand surges for the raw material used in electric car batteries.
Senator Ricardo Nunez, a member of the Chilean socialist party and the Senate Mining and Energy Committee, said he will send a bill to congress in the next week proposing Chile change its constitution to classify lithium as a “strategic mineral.” That would give the state control over untapped mineral deposits in Chile, the world’s biggest lithium producer.
“This mineral will be critically important as the world looks to green energy,” Nunez said yesterday in an interview at the Chilean congress in Valparaiso. “The Chilean state should take control of exploiting this mineral.”
Soc. Quimica y Minera de Chile SA, the world’s largest lithium producer, known as Soquimich, and Princeton, New Jersey- based Rockwood Holdings Inc. export the element from the copper- rich Atacama Desert in northern Chile. By 2020, a fifth of the world’s cars may be using lithium batteries, Rockwood Chief Executive Officer Seifi Ghasemi said Sept. 28.
Soquimich and Rockwood “practically own” the Atacama salt lake, where Chile’s biggest deposit of lithium is contained in a brine under the surface, said Cesar Perez, managing director of Santiago-based brokerage Celfin SA.
Future Growth
“Future growth will really depend on the Atacama,” Perez said in a Sept. 25 interview in Santiago. Celfin recommends its clients to buy shares in Soquimich.
Nunez’ proposal must be approved by two-thirds of Chile’s senate and lower house. If it passes, Chile’s government won’t try to seize Soquimich and Rockwood’s mines because they have legal contracts to operate, Nunez said.
“We will respect those contracts,” he said.
To contact the reporters on this story: Matthew Craze in Santiago at mcraze@bloomberg.net; Michael Smith in Santiago at Mssmith@bloomberg.net
Last Updated: September 30, 2009 13:08 EDT |
