We invite you to read the opinion piece by our Director of the Energy and Infrastructure Group, Federico Rodríguez, on lithium development in Chile.
Much has happened since, during Michelle Bachelet’s second administration, a public policy for lithium development in Chile began to take shape. That discussion only reaffirmed the strategic and non-concessible nature of the mineral, a principle established since the late 1970s.
However, during President Piñera’s administrations, attempts to expand production through CEOL (Special Lithium Operation Contract) tenders or direct negotiations became mired in administrative, judicial, and regulatory controversies, reflecting the lack of a clear institutional path to enable new projects.
Today we know that Chile made a clear political decision: lithium is strategic, and the State must play a leading role. Not only as a regulator, but also as a partner and, in some cases, a controller. The National Lithium Strategy of former President Boric’s administration was structured on this premise. And the market responded rationally: if lithium is under state reserve and requires a CEOL, then the least risky path is to partner with whoever can grant it or already possesses it.
The main projects currently under development follow this pattern. In the Salar de Atacama, Codelco holds a majority stake in the joint venture with SQM. In Maricunga, Codelco controls the joint venture with Rio Tinto (50.01%). In Altoandinos, Enami is partnering with Rio Tinto, although here control will be in private hands (51%), which also makes sense given Enami’s lower operational capacity and experience.
The message is clear: investors do not seek to confront the state. They seek to align with it. But that decision has an inevitable consequence: if the State becomes the enabler of the business, it must behave as a predictable, efficient, and financially credible counterpart.
And that is where the real debate lies.
Lithium is not copper. It is not a linear business. It is cyclical and volatile. Between 2022 and 2024, the price went from historic highs to sharp declines. When the price rises, everyone wants to participate. When it falls, the projects that survive are those with lower costs, greater legal certainty, better access to financing, and executable timelines.
In that context,time is not an administrative detail. Time is economic value. The uncomfortable question is inevitable: did Chile’s lithium policy allow the country to fully capitalize on the window of high prices? Or was part of that potential revenue diluted while the model was being designed and negotiated?
This is not an ideological critique. It is a management assessment.
The CEOL became the state’s true instrument of power. Without a CEOL, there is no project. And that has had an effect: international investors prefer to partner with Codelco or Enami rather than try to navigate the process alone.
But the central dilemma remains unresolved: can the state guarantee that private projects will obtain a CEOL in a timely and proper manner?
Today, the honest answer is that it cannot fully do so. The process depends on multiple factors: contract negotiations, indigenous consultations, community relations, administrative oversight, and environmental permits. All of this makes the CEOL not just an enabling title, but a complex political, legal, and territorial negotiation.
While that complexity is being resolved, the price cycle continues to move forward.
And in a volatile market, time is not just about management—it is about price.
Column written by:
Federico Rodríguez | Director, Energy and Infrastructure Group | frodriguezm@az.cl
