Will Bolivia ever be able to take advantage of its rich lithium resources?

The Bolivian government plans this month to sell mining rights in the country for the element lithium. Officials hope the move will bring economic growth to the southwest of the country.

The project is the largest in the South American country ambitious yet to supply lithium to the world market. The metal is in high demand for use in electric cars Battery and electronic devices.

American Tesla and German Volkswagen are struggling to get supplies while lithium prices have risen sharply.

But it is still unclear whether Bolivia can achieve its goals.

Reuters news agency spoke to many current and former officials and residents of the Salar de Uyuni, a dry lake, in the southwest of the country.

These people identified a number of obstacles to the big project, including legal issues, technological problems and resistance from citizens. In addition, there are likely to be political disagreements within Bolivia’s ruling socialist party over taxes and the distribution of project profits.

Bolivia plans to announce one or more partnerships with foreign companies later this month. Eight competitors from China, Russia, Argentina and the United States make financial offers or bids. Reuters says none of the companies have experience in commercial lithium mining.

The South American country has set itself a lofty goal. It aims to locally manufacture lithium-ion batteries by 2025.

However, Bolivia’s neighbor Chile has been pursuing the same goal for years without success. And it’s a much richer country.

Juan Tellez is an adviser to the local governor. He said officials did not expect any production until 2030 or five years after the central government’s plan.

The US Geological Survey estimates that Bolivia has about a quarter of the world’s known lithium resources. But it’s still unclear if the metal can be recovered commercially.

This past is the past

Bolivia has spent hundreds of millions of dollars using traditional methods to extract lithium with little success. For this project, President Luis Arce wants contracts with companies that use a different, untested technology called “direct lithium mining.”

Bolivian Deputy High Technology Minister Alvaro Arnes attends a ceremony at the factory of Bolivian state-owned company YLB in Salar de Uyuni, Bolivia, March 25, 2022. . (REUTERS/Claudia Morales)

The list of companies willing to try includes US companies Lilac Solutions, Breakthrough Energy and EnergyX. Others include Argentina’s Tecpetrol, Russia’s Uranium One and China’s Fusion Enertech, CITIC Guoan Group and TBEA.

Arce’s government is allied with Russia and China. But US officials say they believe the two US companies have a fair chance.

Alvaro Arnez is Deputy Minister in the Department of Energy of Bolivia. He oversees the development of lithium. He says it is important for the government to produce results to show that it is serious.

Salar de Uyuni is not too far from Potosí, a colonial center of silver production for the Spanish Empire. Today, this is an area where the ruling Socialist Party enjoys strong support. But local officials have criticized the current president for trying to control lithium production without their approval.

“We don’t even have a channel to express our opinion,” Councilor Tellez said, adding, “We find out (the decisions) through the press.”

Deputy Minister Arnez said the Bolivian government has offered to create commercial partnerships to extract lithium and manufacture batteries. The government would own 51% and take about half of the corporate profits.

Karina Quispe sits in her shop near the Salar de Uyuni in Uyuni, Bolivia, March 29, 2022. (REUTERS/Claudia Morales)

Karina Quispe sits in her shop near the Salar de Uyuni in Uyuni, Bolivia, March 29, 2022. (REUTERS/Claudia Morales)

To do this, however, Bolivia needs to change its laws that prohibit foreign companies from mining lithium. Local authorities want to use this fact to negotiate a larger share of the profits. They want 15% instead of the 3% they would get under the current law.

The city of Uyuni gives its name to the huge dry lake. Eusebio Lopez said that, “as owners of this wealth”, the people who live there should get the most out of the project.

A public lithium extraction plant in the region employs 700 people, but few come from local communities.

“We have minerals, we have lithium,” said Karina Quispe, a villager from Uyuni, adding, “People here should get something.”

Juan Carlos Montenegro is a former government lithium mining official who served under former President Evo Morales. He warned that people are getting too excited. “It’s not grounded in reality,” he added.

I’m Mario Ritter Jr. And I’m Caty Weaver.

The Reuters news agency reported this story. Mario Ritter Jr. adapted it for VOA Learning English.

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words in this story

ambitious –adj. have a desire to be successful, powerful and famous

battery -not. a device that stores electricity to operate equipment

commercial –adj. used for commercial purposes

extract -v. to extract a specific substance from a material using machinery or a chemical process

channel -not. a way of expressing ideas, opinions

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Edward K. Thompson