Mexico will reject private lithium deals even if reform bill fails

The bid to bar private lithium mining is part of a controversial electricity reform bill that seeks to strengthen state-owned power company CFE and prioritize the dispatch of energy from its plants.

Even if the constitutional power and mining reform is not approved by lawmakers, which would require passage by a super-majority in Congress, Lopez Obrador said his government already has the power to reject any would-be private lithium concessions.

“We will deny any request for a concession to exploit lithium and we have the power to do that,” said Lopez Obrador. “What we want is that it is established in the constitution that lithium belongs to the state.”

While Mexico is believed to have potentially large lithium deposits mostly trapped in hard-to-access clay soils, there is currently no commercial production of the ultra-light metal, key to making rechargeable batteries used in electric vehicles.

Lopez Obrador, a leftist resource nationalist, has repeatedly said that his government will not approve any new mining concessions, arguing that past governments authorized too many such deals.

Mexico’s top lithium prospector, Bacanora Lithium, holds four concessions in northern Sonora state, and for years has claimed to be closest to launching production, though it has several times pushed back its forecast.

Lopez Obrador said last week that companies with active lithium concessions that can demonstrate successful exploration work will be able to continue with their projects, which presumably would cover Bacanora.

In May, China’s Ganfeng Lithium, a major battery maker, said it had agreed to buy the shares of Bacanora it did not already own.

(By David Alire Garcia; Editing by Chizu Nomiyama and Steve Orlofsky)