Chile rejects Tianqi’s appeal for vote in SQM-Codelco lithium deal
Chile's financial regulator had allowed a planned lithium joint venture between SQM and Codelco to proceed without a vote by SQM shareholders.
A plan to kick off a partnership between Chilean state miner Codelco and the world’s No. 2 lithium producer SQM is on track for next year despite a potential challenge from a major SQM shareholder, China’s Tianqi, Codelco chairman Maximo Pacheco said on Thursday.
Codelco and SQM last week announced the finalized terms of a deal that will let SQM boost output through 2060 in Chile’s prized Atacama salt flat, while giving Codelco a majority stake in SQM’s operations. The tie-up will push the state into a front-line role in developing the key electric vehicle battery metal.
Tianqi, which holds about a fifth of shares in SQM, has argued to Chile’s financial regulator that a shareholders’ vote is first needed to approve the agreement, and said it is evaluating further action to protect its interests.
Chile’s financial regulator is reviewing Tianqi’s complaint, and has said that the company could appeal the decision in the court system.
“I don’t see how this could keep the partnership from coming to fruition,” Codelco chairman Maximo Pacheco said in a press conference, when asked if the company anticipated delays due to a potential legal dispute.
Codelco and SQM expect to resolve final conditions surrounding the deal in the first half of 2025, they said last week.
Chile is the world’s second-largest producer of lithium after Australia, thanks to output from SQM and Albemarle.
The SQM-Codelco alliance aims to increase production while developing alternatives to the traditional evaporation ponds used for lithium extraction.
However, the new technology, known as direct lithium extraction (DLE), likely won’t begin to go into use until 2033, Pacheco said.
“We’re going to be gradual … to combine traditional technology with new technology,” he said.
(By Fabian Cambero, Daina Beth Solomon and Brendan O’Boyle; Editing by Sarah Morland and Kylie Madry)
Comments