RIO DE JANEIRO, BRAZIL – Bolivia, Argentina, and Chile began a political rapprochement to design a joint economic project for the industrialization of resources in the so-called “lithium triangle.”
The three countries, whose governments currently lead with coinciding political tendencies, contain 58% of the world’s total lithium reserves, so their individual or collective performance will be vital in defining the future of the planet’s energy transition and the advance of global electromobility.
“Between Argentina, Bolivia, and Chile, we have more than 85% of the lithium reserves in salt flats. This opens up a great opportunity and challenges and invites us to think regionally,” said Marcela Hernando, Chilean Minister of Mining. She said she felt “tremendously motivated” by the possibility of establishing a “new relationship” with similar ministries in Argentina and Bolivia.
“Coordinated work between Chile, Bolivia, and Argentina is the way to foster synergy between the countries and add value to regional lithium production,” said Guillermo Usandivaras, Argentina’s Undersecretary for Institutional Energy Coordination.
“We recognize that there must be union and coordination between our countries to a future of opportunities for our peoples based on natural resources and lithium reserves,” said Franklin Molina, Bolivian Minister of Hydrocarbons and Energy.
The three authorities participated in the forum ‘Perspectives of Lithium from Latin America’, a virtual meeting held on April 13 that concluded with the announcement of an international congress for this year, in which the presidents of Chile, Argentina, Mexico, and Bolivia will participate.
“I applaud this convocation, and on behalf of President Andrés Manuel López Obrador, I express my country’s willingness to continue working together,” said Rocío García, Secretary of Energy of Mexico, which contains 1.7% of global lithium reserves and is in the process of nationalizing this wealth, during the event.
“The four countries concentrate 62% of the world’s lithium reserves and 90% of the reserves from continental brines,” said Benjamín Blanco, Bolivian Vice Minister of Foreign Trade and Integration.
The authority explained that one of the main objectives of the forum was to identify the potentialities that exist to develop lithium production “together”.
“From Bolivia, we are sure that only a joint work, among brotherly peoples, will allow us to find the elements of convergence and complementarity on this resource that will allow us to overcome our structural limitations,” he said.
The Economic Commission for Latin America and the Caribbean (ECLAC) described the forum as “transcendental”, with a view to the countries taking advantage of the “short window of opportunity (of a decade)” of “high lithium prices”.
“There are opportunities for integration throughout the lithium value chain (…). We have to move very quickly,” remarked Jeannette Sánchez, director of the Natural Resources Division of the United Nations agency, who pointed out that international demand for lithium will grow up to nine times more by 2050.
Analyst Juan Carlos Zuleta agreed on the need for joint coordination to develop the resource in the region.
“It would be madness to think that any of our countries could advance alone in the industrialization of lithium,” he said.
However, he added, this rapprochement between the countries’ governments that make up the ‘lithium triangle’ is part of “a scheme to strengthen forces at a regional geopolitical level, rather than a real economic undertaking that would be beneficial for their populations”.
The rapprochement with Chile – the thorniest since both countries broke diplomatic relations in 1978 – began on March 11 of this year, with the participation of the Bolivian president, Luis Arce, in the inauguration of the Chilean president-elect, Gabriel Boric; took a second step on April 7, with Arce’s public declaration of “coordinating” the “lithium issue” not only with Argentina – with which a memorandum of understanding on the matter has already been signed – but also “with other countries”; and showed another sign with Chile’s participation in the forum organized by Bolivia on April 13.
VALUE CHAINS
On the Argentine side, the political rapprochement resulted in the signing on April 7 of a Memorandum of Understanding that establishes the exchange and transfer of scientific and technological knowledge in evaporite resources and lithium.
The Argentine Foreign Minister, Felipe Solá, had already anticipated in March 2021 that Argentina and Bolivia could face “a joint (lithium) production”.
Currently, the strategies to exploit this mineral in the ‘lithium triangle’ differ in form and substance since the exploitation and processing of the resource in Argentina and Chile is carried out by private companies, while Bolivia maintains state control over the entire chain.
However, the Chilean government plans to create a public company “to maximize benefits for the country, the sustainability of the salt flats, and adding value,” Minister Hernando anticipated.
Argentina, in turn, considers lithium “a central resource” for the energy transition and an opportunity “to achieve a regional synergy that allows countries with reserves to “share strategies in the medium and long term,” according to Usandivaras.
“We believe that these potentialities found in our countries will undoubtedly contribute to the supply chain, raise the production levels of raw materials, and generate a whole chain to produce both cathodes and batteries,” said Molina.
On this path, Bolivia is promoting the industrialization of its evaporative resources with the construction of a lithium carbonate industrial plant with a production capacity of 15,000 tons per year; with the pre-selection of eight international companies that will compete for the direct extraction of Bolivian lithium, one of which will assist in the state process; and with the identification of more reserves in salt lakes and other salt flats such as Pastos Grandes and Coipasa.
In addition to having a lower cost and reducing the environmental impact, direct extraction will reduce the time it takes to separate lithium and other metals found in the brines.
“We believe it is important to achieve a continuous lithium supply and supply chain with the vision of generating productive surpluses with high added value,” said the Bolivian minister, who also anticipated that this year the process will begin for the construction of a plant with a capacity of 40,000 tons of lithium with technology that “will guarantee a lower environmental impact, lower energy consumption and greater recovery and yield of lithium.” But Zuleta is not so confident in the national process nor a possible regional integration based on lithium.
“The situation is complicated. Our governments are not sincere; they are populist governments whose main objective is to remain in power. With governments of this kind, it is very difficult to advance on such a central and important issue as the development of the lithium value chain, at a time as important as this, in which the whole world has been betting for several years on the beginning and consolidation of the new era of lithium and electric vehicles,” he said.
With information from El Deber