The National Copper Corporation (Codelco) and Sociedad Química y Minera de Chile SA (SQM) have finalized the Partnership Agreement outlined in the Memorandum of Understanding released last December. This agreement meticulously delineates the procedures, phases, rights, obligations, terms, and conditions of the public-private partnership slated to oversee the production of refined lithium in the Salar de Atacama from 2025 to 2060.

The partnership, comprising Codelco via its subsidiary Minera Tarar and SQM through SQM Salar, will be activated once all legal, regulatory, technical, and environmental prerequisites, along with the corresponding indigenous consultation process, are met. The completion of these procedures is anticipated in the initial months of 2025.

As per the agreement, the objective is to attain a cumulative increase of 300,000 Lithium Carbonate Equivalent (LCE) from 2025 to 2030, with an annual production target of 280,000 to 300,000 tons of LCE from 2031 to 2060. This augmentation in lithium output will be realized through enhanced process efficiency, the integration of novel technologies, and the optimization of operations, without necessitating elevated brine extraction or utilization of continental waters.

Key Principles of the Partnership:

Aligned with the provisions outlined in the Memorandum of Understanding inked on December 27, 2023, the Partnership Agreement stipulates the following:

1. The partnership will be structured as a joint venture, with Codelco holding a majority ownership of 50% plus one share.

2. Commitment to operational continuity and adherence to SQM's lease agreement until 2030 is guaranteed, ensuring the fulfillment of existing agreements with local communities and other social organizations.

3. Operations of the partnership are projected to commence in 2025, subject to meeting preliminary conditions, including indigenous consultation processes conducted by Corfo and compliance with all operational processes and permits. These include authorization from the Chilean Nuclear Energy Commission, ratification by the Office of the Comptroller General of the Republic, and various antitrust approvals by the National Economic Prosecutor and other international agencies.

4. The partnership will undergo two operational phases:

• The initial phase will span from the commencement of the partnership until December 31, 2030, with SQM overseeing general management.

• The subsequent phase will extend from January 1, 2031, to December 31, 2060, with Codelco assuming general management responsibilities.

5. The partnership will be tasked with conceptualizing and executing a new production project, integrating innovative technologies to achieve water balance while simultaneously enhancing lithium recovery and complying with the highest environmental standards.