Chilean Codelco and SQM Partnership on Track Despite Tianqi's Challenge

Chilean state miner Codelco and the world's second-largest lithium producer SQM plan to kick off their partnership by 2025, despite potential challenges from major SQM shareholder, China's Tianqi. Tianqi has lodged a complaint with Chile's financial regulator, but Codelco is optimistic that the partnership will proceed as planned.

A plan to kick off a partnership between Chilean state miner Codelco and the world's No. 2 lithium producer SQM is on track for 2025 despite uncertainty over a possible challenge from a major SQM shareholder, China's Tianqi, Codelco chairman Maximo Pacheco said on Thursday.

Codelco and SQM last week announced the finalized terms of a deal that will let SQM boost output through 2060 in Chile's prized Atacama salt flat, while giving Codelco a majority stake in SQM's operations. Tianqi, which holds about a fifth of shares in SQM, has complained to Chile's financial regulator that a shareholders' vote is first needed to approve the agreement.

Chile's financial regulator is currently reviewing Tianqi's complaint, and has said that the company could appeal the decision in the court system. "I don't see how this could keep the partnership from coming to fruition," Codelco chairman Maximo Pacheco said in a press conference, when asked if the company anticipated delays due to a potential legal dispute.

Codelco and SQM said they expect to resolve final conditions surrounding the deal in the first half of 2025. SQM has maintained that only a board vote is required, citing an earlier regulator ruling.

Chile is the world's second-largest producer of lithium after Australia, thanks to output from SQM and Albemarle (ALB.N).