Codelco and SQM formed NovaAndino Litio, giving Chile greater state control over Atacama lithium production through 2060.
Chile has taken a decisive step in reshaping its lithium industry after state-owned copper producer Codelco and leading lithium miner SQM formally concluded a strategic partnership to expand lithium development in the Atacama Desert, one of the most lithium-rich regions in the world. The agreement marks a major milestone in Chile’s ambition to increase state participation in critical minerals while safeguarding long-term production growth essential for the global energy transition.
Under the transaction, the two companies established a new joint venture, NovaAndino Litio SpA. This entity was created through the integration of Codelco’s affiliate, Minera Tarar SpA, with SQM’s Salar SpA unit. By consolidating their assets and operations, the partners aim to streamline lithium extraction, improve operational efficiency, and provide long-term certainty over one of Chile’s most valuable natural resources. According to the companies, the deal is expected to deliver a significant and positive contribution to Codelco’s financial performance starting in 2025.
As part of the agreement, SQM transferred all of its mining concessions located in the Salar de Maricunga to Codelco, further strengthening the state miner’s position in Chile’s lithium sector. This transfer aligns with the government’s broader objective of ensuring that strategic mineral assets remain under meaningful public oversight while still leveraging private-sector expertise and capital.
NovaAndino Litio SpA will assume full responsibility for lithium exploration, production, and commercialization activities in the Salar de Atacama through to the year 2060. The arrangement guarantees operational continuity under existing contracts with Chile’s development agency Corfo, while also providing a framework for new contractual terms that will come into force from 2031 onwards. These provisions are designed to balance regulatory stability with the flexibility needed to adapt to evolving market conditions.
The partnership represents a central pillar of the resource policy agenda promoted by Chilean President Gabriel Boric, who has consistently advocated for stronger state involvement in the exploitation of lithium, a mineral seen as critical to decarbonization and the global shift away from fossil fuels. Lithium is a key component in electric vehicle batteries and energy storage systems, making Chile’s vast reserves strategically important not only domestically but also internationally.
Before the agreement could be finalized, it had to pass regulatory scrutiny abroad. The final major approval was secured in November, when authorities in China gave their consent. That approval was granted on the condition that Codelco and SQM continue to honor all existing commercial obligations and maintain lithium supplies to Chinese customers on a fair, reasonable, and non-discriminatory basis. This condition underscores China’s role as a major consumer in the global lithium market and highlights the international implications of Chile’s policy decisions.
Overall, the formation of NovaAndino Litio signals a new chapter for Chile’s lithium industry. By combining state leadership with established private-sector capabilities, the country aims to secure long-term value from its lithium reserves while reinforcing its position as a key supplier in the global clean energy supply chain.
