Vedanta to exclude base metals business from sweeping demerger
The group said it will consider the base metals business demerger at a later stage.
Salar de Atacama, the largest salt flat in Chile. WikiMedia Commons.
Chilean President Michelle Bachelet and Mining Minister Aurora Williams have taken their first step in prioritizing lithium by creating a National Lithium Commission to evaluate state of the industry.
The 20-member commission will work to recommend, by October or November of this year, a new state policy for the exploitation of lithium. The goal is to improve the current concession system to boost the exploration and mining of lithium, as well as lift the entrance barrier for new actors.
Lithium was one of the few mining issues that were directly addressed by then-candidate Bachelet during her presidential campaign. She recognized the growing global demand for the mineral, and that some of its most important reserves are located in the Atacama salt flats in northern Chile.
The nation owns 70% of the world’s known lithium reserves. But due to current regulations, dating back to 1986, only two companies are allowed to mine the increasingly popular metal used as a key component in smartphones, hybrid cars and computer batteries.
Late last year, the Chilean government attempted to bypass this legislative obstacle by launching a tender for special lithium contracts, but the process was cancelled after irregularities came to light. The main issue was that the top executive of the winning company, was Chile’s Minister of Mines’s brother, which many argued could have meant he had access to classified information.
The failure of that tender, as well as political and civil opposition towards the awarding of lithium concessions has made the legal path towards lithium mining in the South American nation quite uncertain.
Robert Baylis, industrial minerals research manager at UK-based Roskill Information Services, says the move would be worth it, as the market for the commodity is growing at a brisk pace and is dominated by only a handful of firms, including SQM, FMC, ROC, US-based Li3 Energy, Canadian miner Talison Lithium and mining behemoth Rio Tinto.
