MercoPress. South Atlantic News Agency

Bolivia's lithium company says deal with Chinese partners is risk-free

The Chinese company has three years to start collecting top-quality lithium or leave Bolivia with no compensation after investing over US$ 1 billion

Yacimientos de Litio Bolivianos (YLB) Legal Manager Pablo Nina warned Tuesday that the Chinese company Hong Kong CBC has three years to extract a mineral with 99.5% purity and 80% recovery in the raw material processing or face the dismantling of its two battery-grade lithium carbonate production plants in the Uyuni salt flat and leave the country.

In any case, YLB sees the contract with the Chinese consortium as a “safe business” whereby CBC invests US$ 1.03 billion and assumes the risks. “We are entering a safe business where we are not putting money,” YLB President Omar Alarcón contended while noting that his company would be in charge of marketing the mineral, which will be sold at international prices, with no discounts.

“We are going to sell at the international price, at the indexed price that is in effect at the moment. There will not be any discount for the companies that are doing the operation and maintenance,” he stressed. In addition, under Bolivian law, 85% of the workers must be Bolivian nationals, he underscored. He added that the Chinese company must also reinvest in a cathode battery plant within 10 years. On the other hand, the Bolivian state-owned company must supply the raw material to its Chinese partners.

As per the Nov. 2024 agreement, the Bolivian State would not have to pay the investors any amount after the construction of two plants with Direct Lithium Extraction (DLE) technology, with capacities of 10,000 and 25,000 tons per year, at a cost of US$ 1.03 billion. The Lower House's Plural Economy Committee approved the contract between YLB and CBC and passed it on to the plenary for debate.

Bolivia is also evaluating a contract with the Russian company Uranium One Group to produce 14,000 tons of lithium per year with an investment above US$ 970 million.