MEETING of SENIOR EXPERTS GROUP (Santiago – Chile)
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MEETING OF SENIOR EXPERTS GROUP (Santiago – Chile)
10‐11 November 2010
ASSESSMENT OF LITHIUM RESOURCES IN LATIN AMERICA:
Opportunities and Issues for Sustainable Development
BACKGROUND INFORMATION PAPER
Prepared by Henri Maire
Consultant
United Nations Department of Economic and Social Affairs (DESA)
Disclaimer: The views expressed in the paper are those of the author and do not necessarily reflect those of the United Nations Secretariat.
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TABLE OF CONTENT PAGE
Lithium minerals 3
Lithium occurrences environment 3
World Lithium Production (GRAPH) 4
Latin America Production Centers 4
Argentina 4
Bolivia 5
Chile 6
Brazil and Mexico 8
Production Considerations 8
World Lithium Mine Production (2008/2009) and reserves (table) 9
Chemical Composition of Lithium Brines Lakes (table) 9
Present Economic data on Main Centers of Production of Lithium (table) 10
Lithium Market 11
Exports of Lithium Products from SQM and SCL (table) 11
Royalties resulting from Exploitation at Salar de Atacama (table) 12
Environment 12
Legal environment 12
Argentina 13
Bolivia 13
Chile 14
Conclusions and Recommendations 15
Sources of Informations 15
Annex I: Regional Map 16
Annex II: Sustainability of Mining activities 17
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LITHIUM MINERALS
The Lithium element is widely distributed on Earth, but does not naturally occur in elemental form, due to its high reactivity. Seawaters contain an estimated 230 billion tons of lithium, though at a low concentration of 0.1 to 0.2 ppm. Estimates for crustal content range from 20 to 70 ppm by weight. In keeping with its name, Lithium forms a minor part of igneous rocks, with the largest concentration in pegmatite bodies.
Only thirteen Lithium minerals are known, of which four have an economic significance to us because of their frequency and higher Lithium content:
Spodumene (LiAl(SiO3)2 (4 to 8 % Li) has become the chief commercial source of Lithium. It occurs as colorless to yellowish / yellowish‐green prismatic crystals, often of great size. The varieties include kunzite (purplish or lilac) and hiddenite (emerald‐green),both of them considered as gem stones.
Amblygonyte (LiAl(F,OH)PO4 (8 to 10 % Li) white to pale greenish or yellowish fluo‐phosphate with a luster vitreous to greasy.
Lepidolite (2 to 4 % Li) phyllo silicate that belongs to the micas group. Its color varies from rose‐red to violet‐gray or lilac.
Petalite (LiAl(Si2O5)2 a poly silicate 2 to 4 % Li
LITHIUM OCCURENCES:
Pegmatites: These coarse grained igneous rocks formed by the crystallization of post magmatic fluids, occur usually in close proximity to large magmatic intrusions. Pegmatites with Lithium content are relatively common and are frequently associated with Tin and Tantalum. Many of the Lithium discoveries resulted from work done on Tin and Tantalum complexes (ref.: Eastern R.D. Congo – Kivus). It has been at the origin of successful economic ventures in the US, Australia, Canada, R.D Congo, Zimbabwe, China, Russia.It was the major source of Lithium (65% of production in 1995) .
However, in 2007, 86% of the production of Lithium came from brines, in majority genetically related with salt lakes. This environment (specially because of favorable mining, and processing costs) has been found to be economically more attractive to date.
Continental Brines: These brines are waters which have leached surrounding volcanic rocks, and have had their Lithium content greatly enhanced through evaporation within closed basins. The Lithium content ranges from 30 to 60 ppm at the Great Salt Lake (Utah) where the evaporation rate is mild and there is a constant influx fresh water, to 200 ‐ 2000 ppm levels at high altitude salares in Argentina, Chile and Bolivia. However the presence of other elements, such as Iron, potassium, sodium, magnesium, nitrates, sulfates, carbonates, boron etc., can alter the economic interest of the brines
Geothermal Brines: At the Salton Sea location in Southern California values of up to 140 ppm have been measured.
Oilfield brines: large tonnages of lithium are contained in oil field brines In North Dakota, Wyoming, Oklahoma, East Texas and elsewhere, with brines grading to 70 ppm.
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Hectorite clays are found in a number of areas over the Western US. The largest known deposit is associated with volcanic rocks over the Nevada / Oregon border, where present drilling is confirming large tonnages found through earlier exploration works.
WORLD LITHIUM MINE PRODUCTION (in metric tons)
Source: Mineral Commodities Summaries 1996, 1999, 2004 and 2010. United States Geological Service (USGS).
LATIN AMERICA PRODUCTION CENTERS:
Some 70% of the world’s presently recognized Lithium reserves are found within the region where Chile, Argentina and Bolivia meet (Map: Annexe I). It is known as the “Lithium Triangle”. It includes the Salar de Atacama (Chile), Salar de Uyuni (Bolivia), Salar del Hombre Muerto and Salar del Rincon (Argentina). These salares are remarkable because of their size and chemical constitution, however there are several other interesting prospective salares in the region which will certainly be considered in the future for their economic potential.
Argentina
The Salar del Hombre Muerto, with a salt nucleus covering 280 km2, is at an altitude of over 4000 meters. It has a relatively low lithium content (220 – 1000) but a very low concentration of impurities. It has an exceptionally low Magnesium/Lithium ratio of only 1.37/1. The brines grades are 692 ppm Li, and proved and probable reserves to a depth of 70 meters total 850 000 tons.
Production started in 1997‐1998 with 12,000 tpy of Li2CO3 and 6000 tpy of LiCl. Costs range between US$ 0.8 to 1.2.
For production, FMC opted for a proprietary recovery technique but there were costs overruns and the carbonate production was suspended, although the chloride production continued.
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Admiralty Resources (Australia) is working at the Salar del Rincon located at 3740 meters.
The salt nucleus covers 280 km2 and the grade 0.033% Li and 0.624%K.
Porosity is 8% to 10%, in line with the other salares of the region. The Mg/Li ratio is 8.6/1 which will require a pre‐treatment to remove the Mg to allow Lithium Chloride to be produced.
Proved and probable reserves are evaluated at 1,860,000 tonnes Li. Although an independent study (2005) estimated the reserves at 250,000 tonnes of Lithium metal or 13% of the latest figures. These reserves were upgraded in 2007 to 1.4MT (911,000 proved and about 500,000 probable). Pilot testing suggests a recovery of 70%, compared with 42% at Atacama.
The company planned to produce by 2009 / 2010 8,000 tons of 99% Li2CO3 carbonate, together with chloride and hydroxide. Production, however, is only economically viable as a multi‐commodity operation: Lithium chloride, KCl, Na2SO4..
Olaroz: The salar is under evaluation by the Australian group Orocobre Ltd.
The prospect offers a certain potential with concentrations of 900 ppm, and estimated reserves of 325,000 tonnes of Li.
Plans are for production to start in 2011.
It must be mentioned that there are numerous mineralized salares still to be inventoried and evaluated over the Argentinian Altiplano: Antofalla, Cauchari, Pachuelos, Centenario, Pastos Grandes.
Bolivia
The Salar de Uyuni, the largest salar in the world, at an altitude of 3 650 meters, covers an area of 9000 km2. Unlike the major Lithium containing salares in Chile and Argentina, it is completely flat, due to annual flooding.
Mineralization:
In 1981,brines grade was reported to be 0.035% Li and 0.72% K, with higher grades toward the southeastern portion of the salar, where values higher than 1000 ppm were recorded. One area (50 km2) averages 3000 ppm.
The evaporation rate is about half that of Atacama, at 1,500 mm per year.
Evans (2008) estimated the Lithium reserves at 5.5 MT (these are the total Lithium resource, and not necessarily economically recoverable resources). The USGS gave an estimate of 5.4 MT and the Bolivian Government (1980) estimated the resources at 9 MT.
There is a high Magnesium/Lithium ratio of 18.6/1 ‐ 22/1. The high ratio will actually prevent the formation of Lithium Chloride (LiCl) in the evaporation ponds, unless Magnesium is removed before evaporation and the concentration starts. The problem is similar to that of the Salar del Rincon in Argentina.
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Geologically, the salar is very different from Atacama:
The Halite deposit is very thin, being only 11 meters thick at the thickest points, and only 2 – 5 meters thick in the southeast area of High Lithium concentration. The Halite however is porous all the way through with a much higher average porosity of 35%, and is filled with interstitial brine. This implies that Lithium available per unit surface is much lower and a greater area of the salar will have to be exploited for an equivalent Lithium production.
Taking this into account the recoverable Lithium Reserve in the Central Highest grade Center of the Salar de Uyuni would be 300,000 tons of Li.
Economics and environment:
Doubts have been expressed concerning the justification of the Bolivian Government intention to build a plant capable to produce 60,000 tpy of Lithium carbonate equivalent in 2013. A more modest capacity would be more realistic.
On the environmental side, there are considerable worries about the impact of the mining activities on the picture of one of the most attractive tourist attraction of the World. The region is of outstanding natural beauty, and the breeding ground of pink flamingoes during the December to February season. The lake is usually flooded from January to March, creating a lagoon area for the birds to feed.
Tens of thousands of tourists visit the salar yearly , leaving considerable financial resources in the region, thanks to improvements made to the local infrastructure.
One can wonder if the defacing of this natural wonder is worth the environmental and human cost.
Regional potential:
There are other large salares in the area (Empreza and Coiposa), resulting from the evaporation of lake Minchin (Pleistocene), with concentrations of 370 and 580 ppm.
Chile:
Salar de Atacama, at an altitude of 2300 meters, is located about 200 kms from the Pacific coast and covers about 3500 km2. However, its Halite nucleus measures 1000 to 1400 km2. It lays within the confines of the driest desert in the world where the evaporation rate reaches 3700mm per year. It is characterized also by the quality of the brines (600 – 5000 ppm).
Ownership:
In 1977 , CORFO acquired 59,820 claims (OMA Group) over a large part of the salar, however in time kept only 32,768 of them.
In 1975, CORFO contracted a partnership with FOOTE Minerals.
In 1980, the partners created the SOCIEDAD CHILENA DEL LITIO (SCL) ‐ 55% FOOTE ‐ over 3,343 claims from the OMA group, then added another 1,370 claims . The same year, the Atomic Energy Commission (CCHEN) approved the sale of minerals (200 000 tpy), including Lithium, until 2014.
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In 1988 and 1989, CORFO sold its share of the partnership to FOOTE Mineral Company.
Meanwhile, in 1986, CORFO had created MINSAL Ltda ( CORFO ‐25%‐ AMAX ‐63%‐ and MOLYNET‐ 11.25%) for the sale of Potassium, Bore , and Lithium, and contributed ultimately 16,814 claims of the OMA group. The CCHEN kept a preferential acquisition right for the Lithium.
Then in 1993, AQM (Soquimich) took over from AMAX and MOLYNET.
In 1995 the CCHEN confirms its approval to produce and market the Lithium salts, with a right of first option. CORFO sells all its MINSAL shares.
Later, FOOTE was acquired by Cyprus Minerals, then by Chemetal and finally by Rockwood Holdings. In 1986 together with a Chilean partner, they reached an agreement with CORFO regarding the possible development of much of the rest of the salar. Their rights were acquired by Sociedad Quimica y Minera (SQM), a major producer of nitrates and iodine.
Geology:
The lake bed consists of dried out Sodium Chloride (common salt). This forms a solid deposit called Halite (rock salt). The top of this halite body near the surface is relatively porous and permeable to water flow: it forms an aquifer through which flows the brine containing Lithium and other useful minerals (such as potassium, boron and magnesium). Further down into the Halite body, millennia of cementation from precipitation of salts by earlier brine flows and compaction block up the pores and the halite body becomes more and more impermeable and solid. This implies that the useful brine, containing Lithium and other soluble salts, is only located in the top 40 meters of the dried salt bed. A thin crust of salt then forms above this top layer of liquid and liquid containing rock salt. Below the current extraction depth of 30 meters, there is no lithium to be recovered. (Meridian 2008).
The basin covers an area of about 3,000 km2 with a salt nucleus covering 1,400 km2. At the northern end of the nucleus a drill hole was still in salt when terminated at 1,000 meters. The area of highest concentration (1000 – 1500 ppm) is over the southern part of the salar (100 km2) where values up to 4000 and more ppm have been located (8 km2).
Mineralization:
The initial reserves, over 790 km2, were calculated at 26.0 million tons of potassium and 1.8 million tons of lithium at an average grade of 0.18%Li. These were in respect of the uppermost 40 meters of the aquifer. Production is carried out in areas where concentration can reach 3000 ppm (0.3%).
In 2008 SQM revised the reserves estimate for its block of claims resulting from the inclusion of brine to a depth of 200 meters. The new estimate is for 77.2 million tones of potassium and 6.0 million tones Li. In addition to the tonnages beneath the Rockwood and SQM claims covering 975 km2, there are buffer zones between the properties covering approximately 100 km2, and there are unclaimed areas to the north of the SQM claims with Lithium values in excess of those in the Argentinian salares. A tentative total of these other areas is 400,000 tonnes Li, taking the total to 6.9 million tonnes. However, it should be noted that SQM concession extends to a depth of 40 meters.
In 1978, Evans estimated the Lithium content of the SQM concession to be 2.2 Mt, down to a 60 m. depth. The USGS estimate is 3 MT and the Chilean State mining company CORFO estimate at 4.5 Mt.
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Presently, the actual reserves of recoverable Lithium is hotly debated on the basis of the production technology , methods an market projections .
Production and potential:
SQM is developing the project in two phases.The first in the area of highest grade potassium, for the production of potassium chloride and lithium, the second in an area of high sulphate values from which they recover potassium sulphate and boric acid. Lithium, currently, is recovered only from the more southerly well field and solar ponds, although the feed grade at the northern location, at about 0.11%Li is considerably higher than those of the Argentinian salares.
SQM is currently expanding its Li2CO3 capacity at their plant near the port of Antofagasta by 50% to 48,000 tpy.
Other Chilean salares (Pedernales, Punta Negra, Maricumga, Incahuasi) also contain Lithium. However their status is presently doubtful as the mining code still considers these prospects as “strategic reserves” and access is limited to State Companies. However a change of the Mining Code is being considered by Congress to allow private investments.
Brazil: There has been a limited production of Lithium from hard rock minerals.
All activities are controlled by the CNEN (Nuclear Energy National Commission).
Mexico: there have been reports of large areas with Lithium potential, however there have been little specifics.
PRODUCTION CONSIDERATIONS
The final commercial Lithium products coming out of the processing plants at the salares are Lithium carbonate (Li2CO3) and Lithium chloride. To obtain Lithium carbonate, the brines are pumped into evaporation pads until a Lithium chloride brine reaches 6 % (Salar de Atacama). (Other minerals precipitate and are removed at different times.) The brine it is then treated with soda ash (sodium carbonate).
The climate of the region is ideal to achieve high rates of evaporation. The Atacama desert for instance is the driest place on earth, with strong winds, and an evaporation rate in excess of 3,700 mm per year.
The ratio of Magnesium to Lithium is a critical factor. If the level of Magnesium in the brine is too high, the evaporation rate is slowed down and lithium yield reduced too much.
At Atacama, large quantities of lithium are returned to the salar as the quantities of brine pumped to the processing plants are in excess of 800,000 tpa for the two potash products. Also, the brines contain much more Lithium than the installed lithium ponds and plant capacity can handle.
Another factor that is generally not appreciated is that nearly all lithium carbonate production in the World is secondary to the main product of the extraction facility. In the case of Atacama, SQM main business is the extraction of potassium chloride (KCl) and potassium sulphate (K2SO4). The large multi‐ commodity operations reduce the Lithium production costs greatly and makes it more competitive.
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WORLD LITHIUM MINE PRODUCTION (2008 / 2009) AND RESERVES IN METRIC TONNES
Compiled by COCHILCO
Country Production Reserves USGS
2008 2009e
Afghanistan* 0 0 Not available (brines)
Argentina 3 170 2 200 800 000 Not available
Australia 6 900 4 400 580 000 (pegmatites)
Bolivia 0 0 (brines)
Brazil 180 110 190 000 (pegmatites)
Canada 690 480 180 000 (pegmatites)
Chile 10 600 7 400 7 500 000 (brines)
People’s Repub. China 3 290 2 300 540 000 (pegmatites)
Portugal 700 490 Not available (pegmatites)
United States Withheld 30 000
Zimbabwe 500 350 23 000 (pegmatites)
World Total 25 400 18 000 9 900 000
e Estimated
CHEMICAL COMPOSITION OF LITHIUM BRINE LAKES
Meridian International Research, 2007
Salar de Salar del Salar salar Clayton Great Zhabuye DXC Salt Taijinaier Sea
Atacama Hombre Rincon Uyuni Valley Salt Lake Salt Lake Lake Salt Lake Water
Muerto USA USA China China China
Li content % 0.5 0.062 0.033 0.035 0.023 0.004 0.12 0.04 ‐ 0.000017
Mg/Li ratio 6.4 1.37 8.61 18.6 1.43 250 low 0.22 ‐ 7000
Height ASL (m) 2300 3700 3700 3653 ‐ ‐ 4422 4475 ‐ 0
LCE recoverable 8 4 1,2 14.3 0.25 ‐ 4 0.4 1.4 ‐
(MT)
(Pedro Pavlovic report – 2004 ‐ Sterling Group Ventures)
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PRESENT ECONOMIC DATA ON MAIN CENTERS OF PRODUCTION OF LITHIUM
Compiled mostly by COCHILCO in 2009
Country Lithium grade Evaporation rate Production costs Present production Proven reserves Resources
Averages in ppm mm per year US$ per lb (?) tons of Li carbonate tons of Li tons of Li
CHILE
Salar de Atacama 1500 (600‐5000) 3700 0.5 – 0.99 54 000 1 000 000 6 900 000
Maricunga (400 – 1500) ‐ 1.0 – 1.5 ‐ ‐ ‐
ARGENTINA
Hombre Muerto 692 (50 – 782) 2775 0.8 – 1.2 15 000 400 000 200 000
Salar del Rincon 397 2600 0.9 – 1.3 ‐ 250 000 1 400 000
Salar de Olaroz 900 ‐ ‐ ‐ 160 000 300 000
BOLIVIA
Salar de Uyuni 350 1500 1.25 – 1.75 ‐ 600 000 5 500 000
Copiasa 340 ‐ ‐ ‐ ‐ 200 000
USA
FMC Lithco (spodumene) 2.43 per kg
Clayton Valley 360 900 1.0 – 1.3 9 000 118 000 40 000
Great Salt Lake 40 ‐ 2 ‐ 2.8 ‐ 520 000
CHINA
Taijanair (Tibet) 360 3560 0.8 ‐1.2 5000 500 000 940 000
Zhabuye (Tibet) 1200 ‐ 0.8 ‐1.2 10 000 750 000 1 530 000
Dangxionscuo (Tibet) 400 – 500 2300 0.8 – 1.2 ‐ 80 000 170 000
TOTAL 93 000 3 858 000 17 630 000
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LITHIUM MARKET
World demand for Lithium for the last 10 years increased 7% to 8% per year, whereas the price of Lithium carbonate went from 1,760 US$ per ton in 1999, to over 6,000 US$ in 2008, an increase of 222 %. However, market conditions deteriorated for lithium‐based products in 2009, mainly because of international recession. Nevertheless prices have leveled without major down turn, and are generally expected to increase again.
Sales volumes for the major lithium producers were reported to be down between 15% and 42% by mid‐ 2009. Consumption by lithium end‐use markets for batteries, ceramics and glass, grease, and pharmaceuticals all decreased. A major spodumene producer in Canada closed its mine owing to market conditions. The leading lithium producer in Chile announced it would lower its lithium prices by 20% in 2010.
Despite the economic downturn in the Lithium market, a host of new companies explored for Lithium worldwide in 2009. Many prospects in Nevada, as well as in Argentina, Australia, Bolivia, and Canada, have been leased or staked.
On June 13, 2010, the NY Times published that ground surveys performed by US teams over western Pakistan salt lakes (Ghazni Province) outlined deposits of Lithium as large as Bolivia’s Uyuni Salar. These studies had been made initially by Soviet teams (1979 – 1989).
In Chile two companies control the production of Lithium: SQM (Sociedad Quimica y Minera) and SCL. They supply 58% of the world production of Lithium carbonate.
EXPORTS OF LITHIUM PRODUCTS FROM SQM AND SCL
In US$ per the year
2006 2007 2008
SQM 96,349,882 148,945,276 174,309,864
Lithium carbonates 79,099,302 120,817,594 142,200,812
Lithium oxides 17,250,580 26,355,477 30,751,450
Lithium chloride 1,722,205 1,357,602
SCL 44,904,099 70,867,453 88,943,537
Lithium carbonates 41,881,955 62,082,382 79,280,153
Lithium oxides
Lithium chlorides 3,022,144 8,785,071 9,663,384
TOTAL 141,253,981 219,812,729 263,253,401
Data based on PROCHILE web (COCHILCO)
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ROYALTIES RESULTING FROM EXPLOITATION AT SALAR DE ATACAMA
In US$ per year
YEAR SQM SCL TOTAL
2006 9,183,480 424,740 9,614,220
2007 13,503,850 650.,238 14,154,088
2008 19,601,908 1,473,640 21,075,548
Data provided by the SEP (Sistema de Empresas Publicas)
(COCHILCO)
ENVIRONMENTAL CONCERNS
In the region, there is a continuing friction between local communities and mining companies over water rights. For instance, in the Atacama region, mining already consumes already over 65% of the water available in the salar de Atacama region.
The salares have become an important tourist destination with thousands of visitors year round. They are also home to unique species of fauna, including the famous pink flamingoes.
Governments must be cautious in submitting the region’s unique and delicate ecosystem to a damaging industrialization process. They should certainly not do so without guarantees of considerable returns, financial as well as social.
LEGAL ENVIRONMENT related with Lithium production
ARGENTINA:
The Mining Code and overall regulations date from 1884.
While the State conserve the jurisdiction on the application of the laws, the implementation process is delegated to the Provinces. As a result regulations may vary from one Province to the other.
In general terms, a request for Concessions is handled preferentially by the judicial body of the Province and then handled by an administrative Government office (concessions authorities) which can differ from one Province to the other.
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Exploration concessions are for three types of activities:
‐ Ground surveys / Air surveys / Underground surveys
These concessions can cover a maximum of 10 000 ha each, and for a maximum duration of 1100 days.
Mining Concessions are perpetual.
It should be mentioned that the Government is making an attempt to modernize the Mining Code and make it more attractive to the foreign investors. There are also efforts made to homogenize the legal framework for mines within the region and there are ongoing discussions with the Government of Chile in that direction.
BOLIVIA:
A new Mining Code was promulgated in 1992. It declared all mineral deposits of Bolivia a State property. Mining concessions awarded by the State grants the holder, subject to certain payments, the exclusive right to carry out prospecting, exploration, exploitation, concentration, smelting, refining and marketing activities with respect to all mineral substances located within a given concession. Under Bolivian law, local and foreign companies are treated equally in obtaining mineral concessions.
A court declared the Mining Code to be unconstitutional (May 10, 2006)
On May 1, 2007, President Morales signed a Decree that assures all mining concessions existing at the time of the Decree will be respected and will remain in effect. All new requests for concessions will have to be in the form of a Joint Venture (50/50) with COMIBOL. No request for private concessions will be considered.
A New Mining Code may be produced in 2010, increasing profit taxes from 35% to 50%, and come up with a new set of environmental considerations.
Interdependence with Chile is obvious and one might expect a close relationship between the two countries in the areas of logistics, supplies, technologies and technological transfers.
CHILE:
In 1983 Chile produced a new mining code, together with regulations.
The code grants the investor the right to explore for minerals within the limits of an exploration concession (1000 ha) which can be secured with the payment of a nominal fee, and for a 4‐years period. Exploitation concessions are secured through the payment of annual fees. There are no limits to their duration, and they can be transferred / transmitted in the same manner as a object of real estate.
Lithium is considered a “strategic mineral”, and all related business is regulated by the Nuclear Energy Commission. However, the Chilean Congress is presently considering a revision of this clause, at the request of the mining sector.
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CONCLUSIONS AND RECOMMENDATIONS
The last 10 years have seen a drastic change in the use of lithium, as well as in the volume of the demand, away from its traditional fields of greases, ceramics, glass, pharmacy, and toward the field of batteries (from computers and other electronic equipment, to battery powered vehicles).
To satisfy a rapidly growing demand, attention has shifted from pegmatites to brines as sources of the mineral, both because of lower production cost as well as huge volumes of mineral readily available. Attention has turned toward the Lithium triangle over Northern Chile and adjacent regions over Bolivia and Argentina, and their huge salt lakes and brines. Chile (Salar de Atacama) has been in a position of supply close to 60% of the market while reserves are being inventoried over other Chilean salares as well as in Bolivia (Uyuni) and Argentina (Hombre Muerto).
Considerable efforts are being made by Governments to modernize and adapt legal and environment regulations to a competitive mineral production environment.
Investors and mining groups are increasingly interested in participating in the evaluation / development of salares, and would welcome Government assistance in easing their steps toward an orderly investment in the mining sector.
In Chile, the creation of a Lithium Desk (or Lithium Institute) has been recommended, that would facilitate to the investor the documentation necessary for a first contact with the Chilean Mining sector: reports, statistics, maps, documents, laws, addresses, etc. The desk could also arrange contacts with representatives of the various Institutions of the Government.
The role of the “Lithium Desk” would be to correlate all national information in reference to the Lithium production activities in the Country, and also work on an effort to integrate the Lithium production activities between the three Countries involved: Chile, Bolivia and Argentina. Already there is a de facto interdependence in the fields of infrastructure, power, water supply. The office would work to improve on these themes and also to enhance this interdependence in the fields of marketing, training, political oversight and policies.
In the area of sustainability of mining activities, the Northern Provinces remember the indiscriminate exploitation of their nitrates and other salts between the end of the 19th and early 20th Century which brought considerable riches to investors, and induced the immigration of a large number of workers to the region, but was suddenly halted due to technical discoveries which radically eliminated the market. What remained are vast areas covered with abandoned pits, shafts, as well as ruins of flourishing cities. It is essential to ensure that the exploitation of Lithium will not lead to similar results.
It is essential that the concerned stakeholders make all efforts ensure the mining operations are as environmentally friendly as possible and natural heritage is preserved and respected for the benefit of present and future generations.
It is also important that national and local governments make sure that they receive a fair share of the revenues provided by mining activities, as they face their responsibilities to (inter alia)
a) upgrade their infrastructure and utilities (health centers, water supplies, power, communications, etc. b) continue to improve on education and training;
14 c) create an environment leading to the creation of new alternate enterprises and employment: technical schools, research facilities, financial support, etc. d) enhance a regional technical, economic and social cooperation, and sharing of infrastructures, mining and processing facilities, to facilitate their competitiveness on international markets.
SELECTED SOURCES OF INFORMATION
Comision Chilena del Cobre (COCHILCO) – Oct 2009 –“Antecedentes para una Política Pública en Minerales Estratégicos: Litio” ‐ Camilo Lagos Miranda
Evans. R. Keith “An abundance of Lithium” ‐ March 2008
Evans R. Keith “Lithium : Facts from the Santiago Conference “ – January 2009 ‐
ICIS (2009) – Bolivia’s Lithium
Newmont Mining Company ‐2009 Sustainability report – report summary
North American Congress on Latin America – Bolivia’s Lithium Challenge – April 2010
Ralph Wahnschafft – Summary report on Official Travel to Chile – 20‐28 July 2010
Richard Savard – Personal communication –
Tahil Williams “The trouble with Lithium” – Meridian International Research – January 2007
Tahil Williams “The trouble with Lithium 2” – Meridian International Research – May 2008
UN Economic and Social Development – Division of Sustainable Development – Johannesburg Plan of Implementation (JPOI)
USGS Mineral Commodity Summaries
Zuleta Calderon Juan Carlos “the Future of Lithium Market” – January 2010
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Annex II
SUSTAINABILITY OF MINING ACTIVITIES
(Background)
The United Nations Commission on Sustainable Development (UN CSD) stated that while the sustainability of extractive industries varies, these operations generally remain associated with a range of environmental and social impacts negatively affecting local communities. Given the importance of mining to revenues and employment in some developing countries, as well as the non‐renewable nature of many mined resources, the sustainability of this industry and the efficient use or its resources for development remain crucial.
How to maximize the development benefits of mining while improving the environmental and social sustainability of the mining sector was first addressed in the Johannesburg Plan of Implementation (JPOI), where the following three priority areas were identified:
1. Address the environmental, economic, health and social impacts and benefits of mining throughout their life cycle, including workers’s health and safety; 2. Enhance the participation of stakeholders, including local and indigenous communities and women; 3. Foster sustainable mining practices through the provision of financial, technical and capacity‐building support to developing Countries and Countries with economies.
It is recommended further to enhance the contribution of mining, minerals and metals to sustainable development by including actions at all levels:
a. Support efforts to address the environment, economic, health and social impacts and benefits of mining, minerals and metals throughout their life cycle, including workers’s health and safety , and use a range of partnerships, furthering existing activities at the national and international levels among interested Governments, intergovernmental organizations, mining companies and workers and other stakeholders to promote transparency and accountability for sustainable mining and minerals development; b. Enhance the participation of stakeholders, including local and indigenous communities and women, to play an active role in minerals, metals and mining development throughout the life cycles of mining operations, including after closure for rehabilitation purpose, in accordance with national regulations and taking into account significant transboundary impacts; c. Foster sustainable mining practices through the provision of financial, technical and capacity‐building support to developing Countries and Countries with economies in
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transition for the mining and processing of minerals, including small‐scale mining, and, where possible and appropriate, improve value‐added processing, upgrade scientific and technological information and reclaim and rehabilitate degraded sites.
As an example, in its annual report (2009 – The Journey Towards Sustainability) Newmont Mining Company states that sustainability can be summarized in four key principles:
First, benefits of economic activity must be considered in relation to their respective social and environmental consequences
Second, in using resources, the needs and expectations of future generations must be considered;
Third, Government, business and other segments of civil society must act together to balance these needs;
Fourth, corporate governance is a critical component in the ability to achieve success in meeting business and sustainable development objectives.
The challenge is to engage, understand and manage the needs and interests of local communities throughout the mine cycle. To build constructive relationships with communities one will develop programs to address the impacts and maximize the benefits that they will receive, and work with them to prepare for significant transitions in the project, especially the transition to closure
The ever increasing scarcity of water, the physical and legislative changes that will come with climate change will continue to be the key environmental challenges to face the business.
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