State-run copper giant Codelco and lithium giant Sociedad Quimica Y Minera de Chile (SQM) (NYSE: SQM) have formed a joint venture to increase lithium production in the Atacama salt flats.
The Fiscalía Nacional Económica (FNE), Chile’s competition regulator, approved the joint venture between SQM and Codelco on April 24, 2025. This partnership aims to expand lithium production is a central element of President Gabriel Boric’s strategy to increase state involvement in the lithium sector.
The FNE’s approval was granted with standard conditions related to information management and operational protocols.
This approval follows regulatory clearances from the European Union, Brazil, Japan, South Korea, and Saudi Arabia. However, approvals from China’s regulator and Chile’s nuclear energy authority (CCHEN) are still pending.
Despite some opposition from Chilean lawmakers and legal challenges by major shareholder, Tianqi Lithium, the JV is expected to be finalized in the second half of 2025.
The regulatory’s approval marks a significant step forward, but the agreement remains incomplete.
Because lithium is both strategic and radioactive, China’s antitrust authorities and Chile’s nuclear energy commission (CCHEN) still require key approvals.
Codelco expects to finalise the agreement in the second half of 2025, once these clearances are secured.
Additionally, the joint venture must continue negotiations with Indigenous communities tied to the lithium-rich Atacama Desert.
These groups hold cultural and territorial claims over lands central to the project.
Codelco chairman Máximo Pacheco said the talks with Indigenous organisations are “progressing.”
He also noted that the FNE’s decision confirms the project is advancing as planned.
“We’re really satisfied with the decision because it confirms that the tie-up is moving forward as planned,” said Pacheco.
Read more: Environment nonprofits go after Hell’s Kitchen Lithium Project in Salton Sea
Read more: Lithium Americas pulls in $250M in third party funding for Thacker Pass in Nevada
Opposition legislators criticize state-run strategy as interventionist
In a recent statement, the company confirmed that the joint venture between Codelco and SQM aims to sharply boost lithium output. Between 2025 and 2030, they plan to add 300,000 tons of lithium carbonate equivalent (LCE) to total production.
From 2031 to 2060, they intend to sustain annual output between 280,000 and 300,000 tons of LCE.
They will drive this expansion by improving process efficiency and deploying breakthrough technologies. Furthermore, they will optimise operations to maximise output.
At the same time, they commit to environmental sustainability by limiting brine extraction and inland water use. Despite recent progress, the agreement continues to face resistance.
Opposition legislators have criticised the state-led strategy for being too interventionist and lacking transparency.
In addition, China’s Tianqi Lithium, a major SQM stakeholder, has launched legal action against the deal. Tianqi argues that the partnership will weaken shareholder influence and shift control away from private investors.
These legal and political challenges have threatened to derail the agreement. However, the deal has continued to advance. If finalised, the Codelco-SQM venture will solidify Chile’s role as a global lithium leader, second only to Australia.
.
