SQM considering options after environmental court ruling
2019-12-30 14:51:52 [Print]
SQM said last Friday it regretted a ruling by a Chilean environmental court that it should be prosecuted over excessive water use in the country's northern Atacama Desert.
SQM said in a statement that it was considering whether to take further legal action over the finding by the First Environmental Court in the nearby city of Antofagasta, which upheld a complaint by indigenous communities bordering SQM's operations.
"The company regrets this decision and remains convinced that its plan - which was meticulously evaluated by the competent authorities - safeguards the protection of the environment," the company said, adding that, "SQM is evaluating the range of options available to it before the law."
The court ruling calls into jeopardy SQM's $400 million plan to expand its lithium carbonate production plant to feed appetite for the ultralight battery metal.
Water has become a key sticking point for the expansion plans of both SQM and top competitor Albemarle, both of which operate in the salt flats of the Atacama, the world's driest desert, which supply more than one-third of the global supply of lithium needed for the batteries that power electric vehicles.
The court ruled that a compliance plan presented by SQM in response to a multi-year investigation by Chile's SMA environmental regulator that found the miner had overdrawn lithium-rich brine was insufficient. The plan included a new online system to monitor extraction rates of brine, which holds lithium in suspension, and the shutting down of one of its freshwater wells.
The court said SQM had no way of proving that the measures it had proposed were capable of containing and reducing or eliminating the negative effects generated by the breaches of the company. The SMA must now resume its sanctioning of SQM for the original infractions, the court said, which could involve fines of over $3 million, the closure of operations or revocation of environmental permits.
SQM said in a statement that it was considering whether to take further legal action over the finding by the First Environmental Court in the nearby city of Antofagasta, which upheld a complaint by indigenous communities bordering SQM's operations.
"The company regrets this decision and remains convinced that its plan - which was meticulously evaluated by the competent authorities - safeguards the protection of the environment," the company said, adding that, "SQM is evaluating the range of options available to it before the law."
The court ruling calls into jeopardy SQM's $400 million plan to expand its lithium carbonate production plant to feed appetite for the ultralight battery metal.
Water has become a key sticking point for the expansion plans of both SQM and top competitor Albemarle, both of which operate in the salt flats of the Atacama, the world's driest desert, which supply more than one-third of the global supply of lithium needed for the batteries that power electric vehicles.
The court ruled that a compliance plan presented by SQM in response to a multi-year investigation by Chile's SMA environmental regulator that found the miner had overdrawn lithium-rich brine was insufficient. The plan included a new online system to monitor extraction rates of brine, which holds lithium in suspension, and the shutting down of one of its freshwater wells.
The court said SQM had no way of proving that the measures it had proposed were capable of containing and reducing or eliminating the negative effects generated by the breaches of the company. The SMA must now resume its sanctioning of SQM for the original infractions, the court said, which could involve fines of over $3 million, the closure of operations or revocation of environmental permits.
Lithium Carbonate 99.2%min Delivered China
Unit:RMB/mt
China lithium carbonate 99%min producers' output statistics by province by month
Unit: mt
