Tesla lobbying to secure lithium from Chile

BATTERY METALS | South American nation plans to create state-run lithium company

BY CECILIA JAMASMIE

Tesla executives met in February with Chilean authorities, as the electric car maker redoubles efforts to secure supplies of battery metals, particularly lithium.

may also be allowed to operate individual lithium projects under a minority stake.

actually available here and are controlled in some cases by a certain country that happens to have a 15-year head start. How do you catch up? That’s the key question,” he said.

One answer is that more investment is needed to increase supply, and investment is needed beyond what is in institutional investor funds, Bahar said.

“We’re also saying we want the investment from certain places. So, it’s a very interesting time. Policy evolves in time,” he said.

Focus on Canada’s strengths

But in the North American context, Canada’s nearly $3.8-billion Critical Mineral Strategy, while hailed by industry, pales in comparison to the US$369 billion earmarked in the IRA. Vaccaro asked the bankers how the Canadian government can make domestic assets sufficiently attractive.

Latinovich said Canada can emphasize positive stories, such as the climate change-mitigating aspects of resources, as well as “priming the pump from the public” to boost support for critical minerals development.

Following the bankers’ panel, former minister of innovation, science and industry, Navdeep Bains, spoke with Vaccaro in a fireside chat.

Bains, now vice-chair of global investment banking for CIBC, said he learned in his former role in the Trudeau government that technology will be critical on the path to meeting climate targets.

He also said more action is needed to speed up permitting.

“There isn’t enough streamlin- ing of projects. It’s a big deal,” Bains said. “The speed and scope we’re talking about are much greater than what the reality is today. Take copper: what we’ve mined in the last 5,000 years — 700 million tonnes of copper — is what we’ll need in the next 22 years to meet the energy transition needs.”

Turning to the international context, the former minister said a decoupling of China from the world’s economy is a real issue that presents many challenges and is playing out in Africa and Southeast Asia. But it’s also an opportunity for the West to offer an alternative to China’s Belt and Road initiative.

“We have to look at unique economic benefits, real meaningful partnerships. Those incentives can help us compete with China,” he said. TNM

The hearings, local newspaper La Tercera reported, also included executives from Albemarle (NYSE: ALB), the world’s top lithium miner and the main competitor of Chile’s SQM (NYSE: SQM) in the Salar de Atacama salt flat, which contains the world’s highest known concentrations of lithium and potassium. Chile’s ministers of foreign affairs and mining and representatives of the country’s development agency Corfo also joined the talks.

The official minutes of the meeting, disclosed by Corfo, show that Tesla is interested in knowing the agency’s development plans for the sector as well as the opportunities for collaboration with lithium producers such as Albemarle.

The talks come as the Chilean government is planning to take a page from Mexico’s book and create a state-run lithium company, although authorities are open to letting private companies into the sector through tenders.

While the administration has yet to release final details, it has said the proposed national lithium company will seek out minority partners to provide the technical knowledge the government lacks.

Private firms that win tenders

The state-run miner’s first main asset would be Codelco’s lithium project at the Salar de Maricunga, a salt flat that hosts Chile’s second-largest reserves of the battery metal.

From mining to refining Tesla wants more lithium, but only a handful of countries can supply the material key to the electrification of transportation.

While Tesla’s CEO Elon Musk has hinted in the past that the company planned to get into mining, he now says the firm is more focused on refining lithium than on extracting the metal.

The “limiting factor” is refining the battery metal, not actually finding it, as no country has a monopoly on deposits, Musk said on Mar. 1 during the EV maker’s investor day.

Tesla’s goal is to produce 20 million EVs a year by 2030, while it delivered around 1.3 million units in 2022.

Ahead of the 2023 investor day, on Feb. 28, Mexico’s President Andres Manuel Lopez Obrador said that Tesla had agreed to build a large factory in Monterrey.

The plant will be one of the country’s first that is entirely dedicated to the expensive and complex process of making electric cars. TNM