Chile selects 6 sites for private lithium projects

By Daina Beth Solomon and Fabian Cambero

SANTIAGO (Reuters) - Chile's government has selected six priority areas for new lithium extraction projects to be led by private companies, the South American country's mining minister said on Thursday.

In October, the government will begin consulting Indigenous communities near those areas, while proposals from private firms will be due Dec. 31, Mining Minister Aurora Williams added.

Chile is the world's second-biggest producer of the key battery metal lithium, with output currently coming from just two companies in the Atacama salt flat.

The government is working to boost production, both through efforts spearheaded by state-run copper giant Codelco, and by encouraging private investment.

Chilean authorities have already received about 20 statements of interest for the six priority areas, which encompass five salt flats and one lagoon, and were identified as high potential for lithium extraction.

"We believe there will be effective competition, given that these are the areas of greatest interest," Williams told a press conference.

To win government approval for lithium extraction, private firms must have experience in the lithium value chain, adequate financial resources, and hold at least 80% of the mining concessions in the proposed project area.

Finance Minister Mario Marcel said the announcement of the six priority areas keeps Chile on track with its target to develop three or four new lithium projects during President Gabriel Boric's administration, and increase lithium production 70% by 2030.

"We're taking all the necessary steps to meet these goals," Marcel said.

(Reporting by Daina Beth Solomon and Fabian Cambero; Editing by Kylie Madry)