In 2023, Chile’s President Gabriel Boric presented the country’s National Lithium Strategy. The plan establishes a leading role for the state when it comes to exploiting the in-demand mineral, alongside an aim to develop a sustainable industry, while also increasing the country’s income.
As of 2021, Chile accounted for approximately 44% of global lithium reserves, followed by Australia (22%), Argentina (10%) and China (7%). But aside from the Salar de Atacama in the north, most of Chile’s salt flats are yet to be exploited – though the country is already second in the world for lithium production, behind Australia.
As part of Chile’s strategy, the government has established lots for 26 salt flats that will be opened up to exploitation by domestic and international companies, through the award of special lithium operating contracts (CEOLs).
In January, Chile’s Ministry of Mining started the CEOL grant process for six of these salt flats. The process for consulting Indigenous populations living in proximity to these areas has already begun, for the Ascotán and Ollagüe salt flats in the northern Antofagasta region, and for the Coipasa salt flat in Tarapacá. Meanwhile, in the salt flats that have been reserved for state exploitation, such as Maricunga, Salares Altoandinos and Atacama – where production is to be expanded – plans are also advancing, with consultations underway.
The government and private sector are also making progress on the strategy’s sustainable development elements: a network of protected salt flats was announced in March 2024, while in January this year, the National Lithium and Salt Flats Institute (Ilisa) was inaugurated. The government says the institute will “ensure the sustainable development of Chile’s lithium resources and salt flats”.
In parallel, many of the companies interested in lithium exploitation (Eramet, Enami, the Chemical and Mining Society (SQM), Albemarle and Grupo Errázuriz) have stated they intend to use direct lithium extraction (DLE). These technologies aim to reduce the environmental impacts of lithium mining, by replacing the traditional solar evaporation extraction method and thus minimising water consumption.
Lithium is mostly extracted from a mineral-rich brine, which is found approximately 10 metres below briny lakes in high-altitude salt flats.
Evaporation extraction: Brine is pumped to an evaporation pool at the surface, where it eventually becomes a mud containing manganese, potassium, borax and lithium salts. The mud is then moved to another open-air evaporation pool. After 12-18 months, lithium carbonate can be extracted, which is the main raw material for lithium-ion batteries. This process is extremely water-intensive.
Direct lithium extraction (DLE): This method is similar to evaporation extraction, but the barren brine is re-injected into the salt flats once its lithium has been extracted. This means less water is removed during extraction. Historically, DLE has been the slower and costlier extraction method, but some commentators expect technological improvements to ameliorate these elements.
In consulting various experts and stakeholders, however, Dialogue Earth has noted strong misgivings as to whether Chile’s lithium sector can develop without significant environmental impacts.
The challenges
The only mining companies currently operating in the Salar de Atacama are Chile’s SQM and US-based Albemarle. These companies’ operations reportedly require more than 63 billion litres of brine every year (almost 2,000 litres per second) from below the desert. The Chilean state mining company, Coldeco, is currently preparing to enter the Salar de Atacama to boost the salt flat’s output, in partnership with SQM – a deal that has faced objections from China’s Tianqi Lithium, a significant stakeholder in SQM.
Everything happens silently and over a long period of time, like a cancer in the bloodJaime Aleé, University of Chile electrical engineer
Jaime Aleé, an electrical engineer at the University of Chile, has been working for more than 10 years on issues related to the Chilean lithium industry. Comparing it to the mining of copper – Chile’s top export, and of which it is the world’s leading producer – Aleé tells Dialogue Earth “the impact is more underhand”. The engineer is alluding to lithium mining’s comparative lack of vociferous techniques, like using dynamite to create holes, or transporting materials on 100-tonne trucks. “Everything happens silently and over a long period of time, like a cancer in the blood.”
The impact of the lithium industry may appear less drastic than open-cast mining, but companies still face significant environmental challenges.
The longer-term negative impacts of intensive water abstraction upon local ecosystems, which have been reported, as well as effects on cultural and spiritual practices, have raised concerns among experts and communities. “Our culture is living with the aggression of lithium extraction because of the issue of our waters, which mean survival for us,” says Sonia Ramos, an environmental activist and community leader from Atacama.
In response, the government has developed several strategies to mitigate impacts. One of the main strategies has been to propose the use of DLE.
DLE has yet to be used on a large scale in Chile, but several companies using its methods in other parts of the world are now developing projects for the country. They include China’s Sunresin. “In China, the company has built plants with capacities ranging from 2,000 to 20,000 tonnes per year,” says Emilio Bunel, an engineering professor at the Pontifical Catholic University of Chile and DLE consultant. He adds that, in total, Sunresin’s projects produce around “80,000 tonnes of lithium carbonate using this technology” every year, mostly in China. Bunel says the company has a pilot plant in northern Chile.
Ingrid Garcés, an academic researcher at the University of Antofagasta, is concerned about DLE technologies. She acknowledges that DLE promises greater efficiency and reduced environmental harm, but tells Dialogue Earth there is still a need for caution: “The implementation of these technologies must be accompanied by a rigorous assessment of their socio-environmental impacts, to avoid repeating the mistakes of the past.”
The government has stressed that its new national lithium institute (Ilisa) will play a crucial role in the development of sustainable extraction technologies. For example, Ilisa will conduct research to characterise the salt flats in question, which can inform sustainable practices. Meanwhile, it will also work to improve the recovery of materials along the lithium value chain, for example, through lithium battery recycling.
Dialogue Earth consulted Verónica Molina, an oceanography and microbial ecology expert at the University of Playa Ancha in Chile’s port city of Valparaíso. Molina is also an Ilisa board member. She says many questions are expected to be answered by the institute, but it is important to “make it transparent that this body does not provide answers to all the challenges facing the industry”. She is optimistic about the possibility of joining interdisciplinary efforts to achieve more sustainable mining, but concedes it “sounds very difficult from a scientific point of view”.
Molina describes the creation of Ilisa as “unprecedented”. Overall, however, she remains cautious: “So far, there are only certain guidelines for the start-up, and we are awaiting the construction of the site in Antofagasta.”
The Ilisa board is currently composed of six members. The government says an additional member to represent Indigenous peoples will be elected.
Ancestral inhabitants
As the National Lithium Strategy envisages further exploitation of Chile’s salt flats, several Indigenous consultations are underway in the north of the country. Here, many areas earmarked for extraction are in close proximity to – and, in some cases, overlap with – communities’ ancestral lands.
In the case of the Salar de Atacama expansion, members of the local Atacameño community (who chose to withhold their identities for fear of reprisals) confirm that several consultations are underway. These include one coordinated by Corfo, the Chilean government agency that promotes economic development.
Leydi Sandon, a member of the Coyo – an Indigenous community living near the basin of the Atacama salt flat – says it has been extremely exhausting to participate in multiple Indigenous consultations simultaneously. She strongly believes this situation is a clear violation of rights. Sandon says there is an urgent need for “arbitration or an independent observer” to ensure these processes are transparent and fair.
Ercilia Araya leads the Colla Pai Ote Indigenous community, whose lands are near the Maricunga salt flats. She has been critical of the Indigenous consultation process carried out by the state’s copper-mining company, Codelco. She alleges a “lack of transparency” and a “failure to fulfil commitments”. Araya adds that her community cannot support Codelco’s CEOL if it continues to threaten water supplies “vital for our existence”, such as the nearby Santa Rosa Lagoon.
A 2024 Codelco press release quoted the country’s mining minister, Aurora Williams, stating the consultations at Maricunga were proceeding in accordance with legal provisions. During an earlier visit to the salt flat at the beginning of consultations, Codelco president Máximo Pacheco had pledged to “build trust, strengthen ties, and maintain a fluid information channel” with communities.
More Indigenous consultations are expected to be announced in the first half of this year. They will cover projects in the salt flats of Agua Amarga, Piedra Parada and Laguna Verde, all in the Atacama region.
Stabilising the boom
In 2022, Chile experienced a lithium boom, when the price of lithium carbonate reached USD 80,000 per tonne. That year, lithium became Chile’s leading export after copper, generating USD 8.5 billion and becoming a key component of the economy. And between 2012 and the third quarter of 2023, Chile collected more than USD 7.3 billion in rental income from mining properties (73% via SQM and 27% via Albemarle). Currently, however, the lithium price is below USD 10,000 per tonne – although Bunel believes it will bounce back again, towards the USD 20,000 mark.
“Companies will not be able to generate that kind of money again,” says Bunel, referring to 2022. He says the focus should be on optimising existing operations, not expansion. This could be achieved in the Atacama and Maricunga salt flats by applying DLE, he argues. Bunel claims this would “improve efficiency and double production, without the need to increase extraction in multiple small projects – which together will not equal Atacama’s production”. He advises a review of the current strategy, especially considering current price estimates.
Nonetheless, the awarding of CEOL contracts for prioritised salt flats is progressing. The companies chosen to develop them will be announced at the end of March. Raúl del Barrio, executive director of Chile’s RJR Salar mining company, tells Dialogue Earth that Errázuriz, a Chilean business group, alongside the Canada-based Lithium Chile, will be awarded the Coipasa salt flat. Meanwhile, for the Ascotán salt flat, he reports that Codelco, Quiborax and Eramet have formed an alliance for the tender.
Jaime Aleé remains critical of the National Lithium Strategy. He argues its initial focus on minimising environmental impacts has quickly become about making money. As a result, he claims, many environmental impacts are being ignored or denied. He is convinced Chile’s current approach to lithium exploitation “will continue, without significant changes”.
