Community or industry: The problems with Bolivia’s lithium potential

Although Bolivia does not have certified lithium reserves, it has substantial mineral resources and has shown an interest in developing them, but at the same time has generated opposition from communities.

In 2023, state company YLB signed agreements with Chinese consortium CBC and Citic Guoan, and Russia's Uranium One Group to develop pilot plants with direct lithium extraction (DLE) technology.

In January, YLB launched another international call for pilot projects related to lithium and other minerals in seven of the country's 28 salt flats. The process is ongoing and agreements are expected to be signed in August.

The calls are part of efforts of the President Luis Arce administration to turn the country into a global supplier, an endeavor complicated by technical and political problems, social conflicts and even corruption.

BNamericas speaks with Gonzalo Mondaca, associate researcher at public interest NGO Cedib, about the lithium plans, the origins of community opposition and the prospects of the industry.

BNamericas: What's the situation in Bolivia's lithium sector?

Mondaca: It's a difficult moment. Bolivia launched two calls to invite companies with capabilities to develop lithium deposits through direct extraction technologies.

The first call took almost two years to lead to some form of agreement. Last year, agreements were signed with CBC, Citic Guoan and Uranium One. This year, in January, another call was launched.

The agreements related to the first call were signed between January and June last year. There were quite high expectations because direct lithium extraction [DLE] has high yields since it recovers amounts greater than 80% of the mineral.

Additionally, direct extraction promised to be a technology that could be installed quickly. By signing agreements in June, the government even talked about installing plants in July, which surprised many of us since we know that direct extraction technology is not easy to install.

In reality, the only experience we have with DLE in South America is in Catamarca, in Argentina, with Arcadium Lithium. But the project began with Livent, which installed a pilot plant that took eight years and was scaled up since 1998, when production began, until reaching 20,000t/y in 2022.

So it took Catamarca more than 20 years to consolidate the industrial scale of lithium production with direct extraction technology.

BNamericas: Has the secrecy with which information has been handled about agreements with Chinese and Russian companies generated problems with the communities?

Mondaca: That secrecy, that lack of information about the agreements, raised a wave of questions.

The communities informed us that YLB, together with Uranium Group, entered the Salar de Pastos Grandes and committed several mistakes, which can only be explained by haste.

They hired a company for hydrogeological prospecting, and this company, aiming to do a more comprehensive and faster job, tried to install a camp for 80 people in a grazing area.

The southern Bolivian highlands are very similar to the Argentine and the Chilean highlands; it is an arid region, so the places where there is humidity and forage for livestock are really valuable to communities, which opposed the installation of the camp.

The officials' response was that this land is reserved for the State, which caused even greater rejection from the communities.

Subsequently, Universidad de Potosí organized a research committee with five teams of researchers from different areas to develop an environmental baseline for Uranium Group, with which it has an agreement. This committee also entered the area without notifying the community – which prevented it from doing any work.

In Bolivia, communities are very protective of their jurisdictions and territories, even more so if someone is going to work in a place where there are water sources, in a region where water is scarce.

The communities said [the teams] cannot enter without consulting them, without permission, without presenting a work plan, among other things, so the work planned for the Salar de Pastos Grandes was stopped.

BNamericas: What problems has the decree regarding the areas reserved for the State generated?

Mondaca: It's a latent problem to which the communities have reacted. That decree was signed by former president Evo Morales in 2015 and the communities, who found out in 2023, when a Uranium One contractor tried to install a large camp to accelerate exploration, reacted.

On the occasion, the contractors mentioned an area of influence in which the communities did not have any rights.

Between 2007 and 2009, these communities registered their properties as community land of origin, which is the concept of indigenous territory in Bolivia. When these delimitations were made, the salt flats and salt lagoons were excluded.

The communities accepted that because they understand that there is only salt water within the salt flat or the salt lagoon. Most important for them are the bofedales [Andes wetlands] around the salt flats, where they take their livestock to graze and where their sources of freshwater are located.

However, after the decree was issued, the reserve area was expanded, in some cases up to 10km beyond the edge of the saline limit, which implies that in some cases the entire basin that feeds the salt flat is covered.

This delimitation is arbitrary and, in all cases, it greatly expands the surface area where the State would have exclusive extraction rights and includes places where there are wetlands, sources of freshwater and, in some cases, sacred places, of cultural importance.

The delimitations, unfortunately, are not accompanied by regulations, so in the areas reserved for the State it is not clear what can and cannot be done, nor to what extent the communities should be consulted. The opposite happens with mining operators, who have to comply with several rules, carry out consultations, for example, to open a path, to use water sources or to make some modification to the territory beyond the specific place where they are extracting.

The communities have demanded the nullification of the decree. They have not started any mobilization yet, but they sent notes to YLB and the hydrocarbons and energy ministry.

BNamericas: Could the tensions generated by the decree make things worse?

Mondaca: In April there were mobilizations in the community of Río Grande, which is very close to the State's evaporation technology facilities, where there are large ponds and two industrial capacity plants to produce potassium chloride and lithium carbonate.

Río Grande is right where the delta of the most important tributary that discharges water into the Uyuni salt flat originates. This community is very close to the place where the Bolivian lithium deposit camp is located, the entrance of the salt flat, and where the ponds and industrial plants are.

The Río Grande community was supportive and an important ally from the start in the lithium extraction and industrialization projects.

However, lately they reported that an agreement was not fully fulfilled, they collected new demands and began to discuss the water issue because there is indeed a risk that their freshwater sources will be reduced because YLB has drilled wells to extract water it needs for industrial use.

The second point the community raised in the debate is the absence of prior, free and informed consultation, an issue they had not demanded in 2008, when the project commenced, nor in 2010, when state investments began.

BNamericas: Why are they complaining now?

Mondaca: When following up on the mobilization, we discovered that the real reason was not to protect water sources or prior consultation. The real objective was to obtain heavy cargo transportation contracts for community members.

YLB signed a contract with a transportation cooperative, with dump drivers and several members of the Río Grande community, who had participated in a tender and lost, so they decided to mobilize to obtain something [this way].

BNamericas: The problems with that community are now solved?

Mondaca: Yes, but that's not the case in the other salt flats.

In the other salt flats, communities are mostly organized as native indigenous communities, not as an agricultural union, and that generates a greater obligation to carry out consultation, even in accordance with their customs.

Additionally, several of these communities are much more abandoned. They have not seen support from the State for decades and their productive systems depend on the few freshwater sources they have available.

It is unlikely that they will be willing to work with lithium mining because this mineral requires extraction of brine and freshwater, which is quite scarce.