With demand for lithium ion batteries for cars, phones, grid storage and more growing each day, there is a race on to secure the world’s supplies of lithium. That race is becoming a battle in Chile, where regulators are unsure about whether or not to give a Chinese state-backed firm the go ahead to buy a major stake in SQM, a Chilean lithium miner.
Reuters reports:
The National Economic Prosecutor’s office, known by its Spanish initials FNE, is set to review the sale by Canada’s Nutrien Ltd of a 32 percent stake in Santiago-based SQM for more than $4 billion to Chinese bidder Tianqi Lithium or any state-backed firm. Chile’s development agency Corfo said in a complaint on March 9 that the transaction would “gravely distort market competition.”
Together, Tianqi and SQM, the world’s second biggest lithium producer after U.S.-based Albemarle Corp, would control 70 percent of the global lithium market, the document said.
The agency’s petition, filed two days before a new Chilean government was sworn in, has put the spotlight on the FNE, which has an annual budget of $11.5 million and 115 staff.
Last week, a senior government official said it “must closely analyze the consequences,” noting that “generally” Chilean policy is not to block transactions because of nationality.
The FNE has until August, with the possibility of further extensions, to determine whether to launch an investigation. While the prosecutor is a political appointee, only a majority vote of the Supreme Court can remove him or her, a safeguard designed to ensure the entity’s autonomy.
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