Codelco and SQM budget $3 billion for lithium project in Chile
Chilean mining companies Codelco and SQM are budgeting $3 billion to deploy new extraction technologies at their lithium joint venture in the Atacama Desert.
Their Novandino Litio partnership set its latest projection after wrapping up design work on a project to introduce more direct ways to recover lithium from brine under the Atacama salt flat in northern Chile, environment manager Julio Garcia said. The venture plans to submit an environmental impact study to regulators in June.
After years of testing, Novandino is advancing toward commercial operations of technologies known in the industry as direct lithium extraction, or DLE. They are touted as cleaner and faster than the traditional evaporation method, in which vast quantities of salty water get vaporized in one of the driest places on Earth, raising concerns about microbial ecosystems.
But large-scale commercial success for direct extraction remains largely unproven. The Atacama is a high-stakes proving ground: if DLE works there, it helps de-risk the technology globally. One key facet of the new process is reinjection, in which lithium-depleted brine is returned to the salt flat to preserve hydrological and geochemical balance.
“It will be rigorously monitored to determine that it not only delivers the recovery rates it promises, but also does not generate any type of impact,” Garcia said in an interview from Novandino’s Santiago offices.
The company has completed years of testing and engineering work on the technologies as it seeks to scale up output to meet demand for electric vehicles and large battery storage, while lowering environmental impacts. The approach combines nano-filtration and mechanical evaporation, along with other technologies already in use at its refinery.
Subject to environmental and other permitting, construction at the project dubbed Salar Futuro will start toward the end of the decade, with full implementation extending into the mid-2030s, Garcia said. Novandino has yet to make a final investment decision. Its previous guidance for the project cost was $2 billion-plus.
The project would gradually replace part of the traditional evaporation system, while maintaining some ponds for potassium production and pre-concentration. Freshwater extraction would eventually end.
Novandino was formed late last year after lithium supplier SQM agreed to hand over a majority stake in its Chilean brine assets to state-owned Codelco in exchange for extending operations.
(By James Attwood)
SQM posts surge in quarterly profit as lithium market tightens
Chilean lithium producer SQM posted on Tuesday a jump in first-quarter profit and revenue, helped by higher prices and stronger sales volumes on robust demand for electric vehicle batteries and energy storage.
The world’s second-largest lithium producer, said net income more than doubled to $365 million in the quarter from January to March quarter, but missed an estimate of $426 million from analysts polled by LSEG.
Revenue climbed 70% to $1.76 billion, beating analysts’ forecast of $1.62 billion, while adjusted EBITDA more than doubled to $837 million, also topping the LSEG estimate of $787 million.
SQM said revenue from the lithium and derivatives business, its largest unit, surged to $1.19 billion, driven by a rebound in prices and a 25% increase in sales volumes.
Chief executive Ricardo Ramos said the company sold about 69,000 metric tons of lithium carbonate equivalent (LCE) during the quarter as it ran at full capacity to satisfy strong customer demand.
SQM said its average realized lithium price rose about 95% from a year earlier to roughly $17.8 a kg, reflecting a tight market turnaround after a slump from record highs in 2022.
Prices for the battery metal came under pressure as supply growth outpaced demand, hurting margins for global producers including SQM and US-based rival Albemarle.
But demand has recently been supported by rapid growth in battery energy storage systems, alongside continued electric vehicle adoption.
Reflecting that improvement, SQM said it now expects its total lithium sales volumes to grow about 15% in 2026, up from a previous forecast of 10%, and estimated global lithium demand could exceed 1.9 million metric tons of LCE this year.
SQM also highlighted progress in its partnership with Chilean state miner Codelco, through their Nova Andino Litio venture, which aims to expand lithium production in the Atacama salt flats.
Ramos said the partners were finalizing documentation to begin environmental permitting for the Salar Futuro project in the coming months.
SQM, one of only two companies producing lithium in Chile, also makes specialty plant nutrients, iodine and industrial chemicals.
(By Kylie Madry; Editing by Daina Beth Solomon and Clarence Fernandez)
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