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BYD Won the Mining Right of 80,000 mt of Lithium Ore in Chile
Jan 13, 2022 13:18CST
Source:SMM
BYD and Servicios y Operaciones Mineras del Norte have each won the mining right of 80,000 mt of lithium in a 400,000 mt tender launched by the Ministry of Mines of Chile in October, and the result was announced on 12 January.

SHANGHAI, Jan 13 (SMM) - BYD and Servicios y Operaciones Mineras del Norte have each won the mining right of 80,000 mt of lithium in a 400,000 mt tender launched by the Ministry of Mines of Chile in October, and the result was announced on January 12. BYD bid US$61 million and Servicios y Operaciones bid US$60 million, and the two contracts together represent approximately 1.8% of Chile's known lithium reserves.

Under the terms of the tender, the successful bidder would be given a seven-year period for exploration, research and project development, extendable by up to two years, and then a further 20-year period to produce lithium salts. Both of these successful bidders must obtain the required environmental permits prior to exploration and must facilitate community development and wellbeing.

It is worth noting that the tender process for the 400,000 mt of lithium contract in Chile has not been smooth. It has caused considerable opposition in Chile. In early January 2022, some of Chile's centre-left opposition party, the PPD, applied to the courts to prevent the outgoing government from accepting the lithium mining contract. However, the application was quickly rejected by the court on the grounds that it was "too late".

According to the USGS 2021 data, global lithium reserves total 21.06 million mt of lithium metal equivalent, equivalent to about 105.28 million mt of LCE, of which the world's top five countries in lithium resources are Chile, Australia, Argentina, China and the United States, accounting for a combined 86%. Among them, Chile accounts for as much as 44%, and is very rich in lithium resources.

According to SMM historical prices, lithium metal spot prices rose as much as 175% in 2021. And as one of the raw materials for power batteries, the average price of battery-grade lithium carbonate rose by more than 418%.

This situation has not been alleviated until now. Lithium carbonate prices have been rising entering 2022, and have now managed to rise to 316,000 yuan/mt and test the high of 350,000 yuan/mt.

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