To compensate for the rising costs of education, health and pensions, cuts or minimum increases have marked the nation’s budget.

Faced with an increase of 4.1% in 2016, this year public spending only increased by 2.7%. The austerity has hit the National Geology and Mining Service (Sernageomin), which received only 1% more (CLP27.841M), and whose budget for the National Geology Plan was reduced by CLP129M for a final budget of CLP4,368. In spite of this, Sernageomin maintains its focus on the geological characterization of the territory to later apply in tasks of exploration.


«We have our eyes and focus set on promoting mining exploration, and innovation of exploration techniques…» said the national director of geology, Omar Cortés, in an interview with CER.

Since 2009, the National Plan of Geology seeks to provide useful information for the development of mineral, energy, and water resources by publishing 200 basic geology charts. In 2016, the unit published eight maps of basic geology and six are planned for 2017.

The search for synergy is a reality In case of economic and political crises, gold becomes a safe haven, because unlike products intended for consumption, the yellow metal is produced to be accumulated.

Recently the yellow metal registered a maximum of US$1,294/oz as a result of the political uncertainty that prevails in the world; the volatility of the financial market has made it necessary to seek new investments and Chile, with gold deposits of great potential, has become the center of attention since the development of joint operations to consolidate infrastructure and reduce operating costs seems to be the pption of the miners.

Earlier this year, Barrick Gold (TSX:ABX) and Goldcorp (TSX:G) announced a plan to develop two of the country’s largest copper and gold deposits. Today, the search for synergy is a reality.

Legal restrictions slow Chile’s leadership As we progress towards 2020, the world is immersed in the technological boom associated with using lithium batteries to store energy, and although Chile is the most cost-effective country to produce it, majors and juniors have preferred to explore and invest in Argentina.

Recently, SQM acquired an interest in the Cauchari Olaroz project in Jujuy Province, through a 50/50 joint venture with a subsidiary of Lithium Americas Corp (TSXV: LAC), Minera Exar. This is an ambitious project that requires an investment of US$245M to produce 25,000t Li during the first stage, and a further US$250M to produce another 25,000t during the second stage.

It was initially thought that Cauchari Olaroz would be SQM’s «plan B» in case it lost Salar de Atacama as a result of litigation with CORFO.

However, Patricio de Solminihac, CEO, has reiterated that the Argentinian operation is part of geo- graphical expansion plan.

Cauchari Olaroz covers 82,500ha and contains reserves of 2.7Mt LCE @ 354mg/l. Lithium Americas Corp’s calculations reveal that the project’s production costs will be US$2,495 /t LiC, which is similar to SQM’s production costs in Salar de Atacama.

The project will generate anual payments of approximately US$60M to the Argentinian government, in income tax, corporate tax and royalties. It will generate around 800 direct jobs during its development stage during the next two years, and slightly more than 250 over the following 40 years.

The Chinese giant Ganfeng Lithium will provide US$174M to finance the construction phase, in exchange for a 19.9% interest in Lithium Americas, and SQM will provide a short-term investment of US$100M.


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