The first conservative to win the Chilean presidency since Pinochet, Harvard educated (economics PhD) Sebastian Piñera attempted to privatize much of Chile's wealth two weeks before leaving office. His attempt failed.
Piñera Awards Bid Worth 160,000 Tons of Lithium Before Exiting
On Wednesday, Chile’s President Sebastian Piñera awarded two contracts worth US$121 million for the exploitation of 160,000 tons of lithium to the Chinese manufacturer Build Your Dreams (BYD) and the Chilean company Servicios y Operaciones Mineras del Norte.
The tender agreement grants 80,000 tons of marketable metallic lithium to each of these companies, which will have a term of 7 years to carry out their projects' geological exploration and development. This period could be extended for another two years if necessary. Subsequently, the concession beneficiaries will have 20 years to extract lithium.
The initial call proposed to tender five quotas of 80,000 tons. Still, only two were awarded, representing 1.8 percent of the national reserves of lithium, a mineral used to make batteries for telephones, laptops, and electric vehicles.
Albemarle and SQM, the only two companies currently producing lithium in Chile, competed for minerals. Still, they received no quotas in the tender, which was launched surprisingly in October 2021 and was awarded two days before the original deadline.
The obvious haste in this natural resources privatization process has been harshly criticized by various political and social sectors, highlighting that President Piñera compromised national income less than two months before leaving office.
The tender "seems bad news to us. It reminds me of those mooring laws that were made at the last minute when a government is already leaving its functions," President-elect Gabriel Boric said after a meeting with 16 governors on Wednesday.
A group of people demonstrated today in front of the Ministry of Mining in Santiago (Chile) | Photo: EFE/Alberto Valdes
The decision was taken after admitting the appeal filed by the regional governor of Atacama, Miguel Vargas.
Chile's Judicial Power confirmed on Friday that the Court of Appeals of Copiapó ordered the suspension of the lithium bidding process, following the controversy that arose in the country after the announcement of the Ministry of Mining.
Through his account on the social network Twitter, he indicated that the "Court of Appeals of Copiapó accepts the appeal for protection and issues a restraining order suspending the bidding process for lithium exploitation, exploration and beneficiation contracts."
It also clarifies that the Court decided, after admitting the processing of an appeal for protection filed by the regional governor of Atacama, Miguel Vargas, and indigenous communities, against the lithium bidding process in the north of Chile.
The appeal filed against this process alleged the violation of constitutional guarantees such as equality before the law, the right to live in an environment free of contamination and to develop any economic activity.
The Court also gave ten days for the Minister of Mining, Juan Carlos Jobs, and the Undersecretary of this entity, Edgar Blanco Rand, to present reports on the adjudications for exploiting lithium.
The Judicial Power indicated that "it is necessary to notify the respondent by the most expeditious means of the filing of the present appeal and the granting of the order not to innovate, attaching a copy of the appeal and the present resolution."
The Chilean Ministry of Mining informed last January 12 that two quotas, of the five available, of 80,000 tons of lithium each, for a total of 121 million dollars were awarded to the companies BYD Chile SpA and Servicios y Operaciones Mineras del Norte S.A.
Following the rejection of this action by several sectors of the country, a group of opposition deputies filed an appeal with the Comptroller General's Office to request an investigation into the legality of the bidding process.
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