Delay in Chile mining permits a serious problem, says local head of Freeport
"The issue of permits is a serious one," said Mario Larenas, Freeport's top executive for Chile.
Uranium One Group (U1G), a subsidiary of Russia’s state nuclear company Rosatom, has signed a deal with Canada’s Wealth Minerals (CVE: WML) to buy up to a 51% interest in the company’s Atacama lithium project, located in Chile’s northern Antofagasta region.
The memorandum of understanding also sets the stage for an increased co-operation between the companies for the development of lithium projects, Wealth Minerals — whose main focus is the acquisition and development of lithium projects in South America — said in a statement.
The Atacama lithium project covers a 46,200-hectare license in one of the world’s highest grade and largest sources of the white metal
“Partnering with U1G will help Wealth accelerate the development of lithium projects by using modern technology and moving away from outdated solar evaporation to a more efficient and environmentally friendly sorption technology,” president Tim McCutcheon said.
The Atacama lithium project covers a 46,200-hectare license in one of the world’s highest grade and largest sources of the white metal, which has become an irreplaceable component of rechargeable batteries used in high tech devices and electric vehicles (EVs).
Other companies operating in the Atacama Salar are the world’s no. 2 lithium miner Sociedad Química y Minera (SQM) and Rockwood.
Market conditions for the battery metal are not optimal. Oversupply worries and cuts to subsidies for electric vehicles makers by China, the world’s largest consumer of the metal have weighed heavily on prices.
After more than doubling in 2016 and 2017, prices for lithium carbonate, the most common type used in EV batteries, have fallen by more than 40% over the past year.
Free-on board prices of lithium carbonate from South American brine ponds are down 31% over the past year to average $10,375 a tonne in September, according to Benchmark Mineral Intelligence data. At the same time, ex-works prices in China have collapsed from a peak of $24,750 in March last year to below South America’s export prices.
Producers in Australia now get $325 less for spodumene concentrate (6% lithium used as feedstock for lithium hydroxide) cargoes than in July last year, when prices were above $900 a tonne, according to Benchmark’s September assessment. Lithium hydroxide prices followed carbonate down, but now trade at a premium to the latter at $13,000 FOB North America.
