Lithium Chile forming joint venture with Eramet

Canada’s Lithium Chile will form a joint venture with France’s Eramet to explore its Molle Verde project in the Salar de Llamara after joining local company Grupo Errázuriz to request a special lithium operating contract (CEOL) for the Salar de Coipasa. 

Both saline systems are located in northern Tarapacá region.

The Paris-based firm will be in charge of a phased exploration program over the next three or four years, and after completing each stage will increase its stake in the joint venture, Lithium Chile said in a statement.

At the end of the third phase Eramet will be able to acquire up to 70% and then it could go on to hold the entire Molle Verde initiative, according to a release. 

Lithium Chile would be entitled to a bonus based on the amount of lithium carbonate equivalent resources that will be defined through an NI 43-101 technical report or other similar instrument.

The Llamara project consists of 35,500ha and according to preliminary brine tests it has a concentration of up to 350mg/l.

In a presentation late last year, Lithium Chile announced that the JV with Eramet would focus on the company's four properties in the country: Llamara, Aguilar, Río Salado and Aquas Caliente. Estimated investment for exploration programs would be around US$20mn.

Last week, the Calgary-based firm said that through its subsidiary Kairos it partnered with a subsidiary of the Errázuriz group, Cosayach Caliche, to jointly request a CEOL from the government. 

The idea is to develop a project in the Salar de Coipasa under a 50:50 JV, another statement said.

Coipasa is part of the saline systems prioritized under the framework of the national lithium strategy that allows private companies to request a CEOL. 

Requirements include experience in some segment of the lithium value chain, financial capacity and having at least 80% of the mining concessions in one of the deposits. 

In addition to experience and financial capacity, “our joint venture covers 89.83% of the Salar de Coipasa polygon, including both exploration and exploitation concessions,” said Errázuriz group CEO Francisco Errázuriz. 

The application submitted by both companies, at the end of January, seeks to use direct lithium extraction technology that has been patented by Grupo Errázuriz.

Brine samples near the surface in Coipasa indicate a lithium concentration of up to 1,410mg/l, comparable to those of the Salar de Atacama where Chilean company SQM and US firm Albemarle operate.

The mining ministry will provide a contract model for applicants who best meet the requirements and if both parties agree, the CEOL will be validated once the indigenous consultation process is completed and a decree with all the contract's conditions is issued.

There are several companies seeking to enter the lithium industry in Chile, such as Wealth Minerals (WM) through its Kuska project in the Salar de Ollagüe.

Its CEO Francisco Lepeley hopes the government will make more agile decisions regarding the granting of contracts.

"Otherwise, the bill that is in congress to make lithium eligible for assignment of a concession will become an increasingly attractive alternative if the strategy does not advance," he told BNamericas.

In Chile, lithium is considered a non-concessionable strategic mineral, unlike concessionable minerals such as copper.