Lithium Partnership Takes Effect: SQM and Codelco Operationalize Strategic Atacama Alliance

The strategic lithium partnership between Sociedad Quimica y Minera (SQM) and state-owned miner Codelco has officially begun operations, marking a transformative moment for Chile’s dominance in global lithium production through 2060. The merger by absorption—which consolidated Codelco subsidiary Minera Tarar into SQM Salar—was finalized in late December 2024, with the restructured entity now operating under the name Nova Andino Litio. This newly formed joint venture will centralize all lithium exploration, production, commercialization, and associated environmental and community initiatives across Chile’s Atacama Salt Flat.

Economic Framework Activated on January 1, 2025

While regulatory challenges from a Supreme Court appeal remain pending—triggered by challenges to earlier approvals from Chile’s Financial Market Commission—the economic substance of the agreement has already begun. Starting January 1, 2025, the dividend distribution methodology and share preferences tied to Codelco’s Series A shares and SQM’s Series B holdings became operational. Both companies are currently finalizing dividend allocations and accounting treatments for their 2025 financial filings.

A Joint Venture Built for the Long Term

The partnership, originally agreed upon in May 2024, represents more than a corporate merger. It preserves continuity with Chile’s Corfo development agency under existing arrangements while establishing new governance terms for operations extending beyond 2031. SQM Chief Executive Ricardo Ramos emphasized the venture’s role in sustaining lithium operations across the Atacama region with enhanced operational standards and sustainability practices.

“This alliance enables us to advance development across the Atacama Salt Flat while maintaining operational excellence and shared value creation,” Ramos noted, underscoring how the combined strengths of both organizations position them to serve global markets responsibly.

Governance Structure and Next Steps

Nova Andino Litio’s governance reflects a balanced partnership, with three board representatives from each company. The inaugural board meeting convened on December 29, 2024, signaling the immediate transition to joint management. Additionally, SQM transferred its complete mining concessions in the Maricunga salt flat to Codelco, further consolidating the alliance’s asset structure.

Implications for Global Lithium Supply

This consolidation underscores Chile’s strategic positioning as a cornerstone of the global battery supply chain. The extended operational horizon through 2060 provides investors and downstream industries with long-term visibility into supply stability from one of the world’s largest lithium-producing regions.