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The Bolivian government is gearing to re-launch the lithium industrialization process, disrupted by the 2019 coup, reports a local newspaper. Former Vice Minister of High Energy Technologies, Luis Alberto Echazu, explains how Evo Morales' bold lithium plan was disrupted and why regional integration is essential for the industry's development.
During his March visit to Mexico, Bolivian President Luis Arce announced publicly that Bolivia had restarted negotiations aimed at the industrialization of its lithium reserves with Germany and opened the doors to other countries willing to participate in the project. Bolivia holds one of the largest lithium deposits of Latin America's Lithium Triangle. The U.S. Geological Survey's latest lithium report indicates that Bolivia's Salar de Uyuni salt flat alone contains 21 million metric tonnes of silvery-white alkali metal.
The demand for lithium, a major component in batteries for electric cars, cell phones, and other electronic gear, is soaring worldwide as the leading industrialized nations have been shifting from fossil fuels to clean energy over the past several years. Li-Ion batteries are indispensable for a whole set of popular rechargeable devices including smartphones, laptops, PDAs, and iPods. Recent estimates point to the fact that the global lithium market may grow by 500% in the next 35 years, making Bolivia's reserves highly important both for the nation and the global market.
Former President Evo Morales, with these facts in mind, during his mandate began to search for international partners to commercialize and industrialize the country's lithium riches. He did not want Bolivia to become simply an exporter of raw materials but planned to create an entire industrial chain including battery plants and car factories in Bolivia. However, mining the metal in Bolivia presents numerous challenges. First, lithium brine found in Uyuni has high levels of magnesium, thus requiring additional efforts to separate the two. Second, Uyuni's higher rainfall and cooler climate decrease the rate of brine evaporation and make lithium extraction more problematic. Third, the lack of infrastructure creates further obstacles.
"Proposals from fifteen companies from several countries were submitted for the industrialization of the evaporite complex to form a joint venture with the Bolivian company YLB (Yacimientos de Litios Bolivianos)", the former vice-minister notes. "This venture had the state company as its majority partner." The German company ACI Systems was awarded the contract. In addition to that, ACI Systems Alemania GMbH offered a new technology aimed at speeding up the extraction process by producing lithium hydroxide directly from brine.
A similar tendering process was carried out for the Salar de Coipasa in Oruro and Pastos Grandes in Potosí, with Chinese company TBEA getting the deal, Echazu recollects.
Both ACI Systems and YLB were expected to establish a plant capable of producing 35,000 to 40,000 yearly tons of lithium hydroxide by late 2022. But joint venture terms, including royalties for local communities, were abruptly opposed by the Potosí Civic Committee (COMCIPO). Faced with local pressure, Evo Morales was forced to suspend collaboration with the German firm.
"I believe that the Civic Committee has distorted the policy of the Bolivian government," says Echazu. "In reality, their movement was part of the coup d'état and therefore prevented the development of the industrialization of lithium and other components of brine. This committee has advisers who have worked with the Chilean government and others with a frank neoliberal position, opposed to the development of sovereign policies and social change. For this reason, they were part of the coup government of Jeanine Añez, whose objective was to hand over the salt flats and their exploitation to transnational companies, as stated by her ministers."
Along the same line, the coup derailed Bolivia's plan to set up a joint venture with TBEA, "but a final agreement was reached on the statutes of the company, only the approval of the supreme decree remained," the former vice-minister emphasizes.
Democratically elected president Morales was forced to flee Bolivia after the 2019 coup. Foreign Office documents show UK saw the new military-backed regime, which killed 18 protesters, as an opportunity to open up Bolivia’s lithium deposits to UK firms. https://t.co/koMPgVLMeqpic.twitter.com/HhVkGiM1yN
After democracy has been restored in Bolivia, Luis Arce is determined to revive Morales' plan and speed up its implementation, judging from his Lithium First Industrial Strategy. The strategy contemplates finalizing a full assessment of the nation´s lithium resources; engaging with leading companies worldwide specialized in lithium and batteries and ensuring that Bolivia is viewed as the global leader in the lithium industry.
At the same time, Bolivia is seeking to strengthen collaboration with other lithium-producing Latin American states. In late March, Arce visited his Mexican counterpart, Andres Manuel Lopez Obrador, to discuss a set of issues including regional integration and production of the alkali metal. Mexico, like Bolivia and Chile, has significant lithium reserves.
"Cooperation and integration of the economies of our Latin American countries will always be of benefit to our peoples," believes Echazu. "Cooperation in scientific and technological matters could achieve greater progress in large projects for the industrialization of the enormous natural resources of the region and thus prevent the penetration of transnational companies that only seek to exploit raw materials and loot their reserves."
#FromTheSouth News Bits | Bolivia is considering legal action against OAS Secretary-General Luis Almagro based on his reports and claims regarding alleged fraud in the 2019 elections, which were used by far right sectors as a pretext for the coup against Evo Morales’ government. pic.twitter.com/EfZEmO0XQu