Lithium Power International Ltd (fka LTHHF)

[Dr_Vonschellan]

Ex-Mining Minister_Juan Carlos_Jobet weighs_in on_NLP.
https://www.latercera.com/pulso/noticia/juan-carlos-jobet-esta-estrategia-tiene-un-sesgo-estatista-no-se-socialibilizo-con-las-comunidades-y-no-tiene-apoyo-politico-transversal/M63UM4CXX5DERBDBFMZC7AYZGY/
English translation follows below.

For my money Juan Carlos Jobet is the number one authority on properly enabling balanced lithium mining in Chile now. He has the correct engineering background, the brains, the foresight and the laser-focused determination to get the whole lithium mining program in Chile set up right the first time and correctly from the git go.

Juan Carlos Jobet for President in 2026 to replace Mommy's Boy Gabby Boric and beat leftist/commie presidential candidate Marcela Hernando plus her leftist/commie freeloading parasite lesbo/dyke team right down into the crapper where they belong. This whole upcoming 3-year delay/subterfuge (see Q5 below) on getting any new lithium mines started in Chile before 2026 is completely the RP's (Radical Party aka PR) devious strategy in collusion with Marcela Hernando to hold off all the Lithium generated glory/golden-eggs/successes until the ultra-commies can get Marcela into the La Moneda presidential seat of power and take credit for the whole lithium revival in Chile under the "soon-to-be-new-rich" ultra-communists.

The Doctor

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Juan Carlos Jobet: "This policy has a statistical bias, it was not socialized with the communities and it does not have bipartisan political support"
by Julio Nahuelhual Muñoz

The former Minister of Energy and Mining of the second government of Sebastián Piñera assures that the new lithium policy launched by the government has serious design flaws and recognizes as an error the fact that the different participants have not been discussed in advance. Likewise, he doubts about the capacities of ENAMI and Codelco to meet the objectives set by the government.

Juan Carlos Jobet has closely followed the fluctuations that have transformed lithium into a key business for the country. As former Minister of Energy and Mining in the second government of Sebastián Pïñera, he began an unsuccessful process to award Lithium Tenders (ie LCE export quota licenses) to private parties towards the end of his term, which was later questioned and rejected by the incoming government of Gabriel Boric.

Q1. Following the announcement of a new National Lithium Policy (NLP), the current dean of the Adolfo Ibáñez University (UAI) business school believes that the new policy launched by the government this week lacks a proper design.
A1. “This policy has a statistical bias, it was not socialized with the communities and it does not have bipartisan political support,” says Juan Carlos Jobet.

Q2. What is your first impression of the National Lithium Policy (NLP) launched by the government this week?
A2. I don't think this qualifies as a policy. A policy needs objectives, deadlines, depth, resources and many things that are not here. It is also not a good sign that this has been done with so little dialogue with the participants involved, nor with the communities. We have been learning that we need a policy with a broad and bipartisan agreement so that it can be sustained over time. I don't think it's a good starting point.

Q3. Does State control of any event that this policy proposes seem good to you?
A3. It is a proposal that has a very statistical bias and stems from mistrust in the private sector. Likewise, the government is going to send proposed legislation (ie to the Parliament) for the creation of the National Lithium Company (NLC) just to comply with creating something that is not needed. The government is not going to have the (Parliamentary) votes for this.

The State of Chile does not have any capacity to operate a lithium company. It does not have the technical knowledge, nor the commercial networks, nor the human teams, or the institutional framework. The idea that everything must be done with the State so that it captures the rents is not a good one. Leasing contracts in the salt flat generated enormous economic benefits for the State.

This Policy has a statistical bias, there was no discussion with the communities and it does not have bipartisan political support.

The proposal also places Codelco and ENAMI as participants in the process... on the one hand, ENAMI is a company that has enormous difficulties in just sustaining its own current business, and even less will it be able to get involved successfully in the lithium market. Except for 2021, the company (ie ENAMI) has not made a profit in the last 10 years. Codelco, in turn, is a company that has many capabilities, but also has many demands: it has had a CEOL since 2018 (in the Maricunga salt flat) and there is still nothing concrete to show for it today. Therefore, involving these two companies in this exercise does not make much sense at all.

Q4. Could the idea that the State negotiate with SQM an extension of the (CORFO) contract that allows the State to capture a higher percentage of the rents make any sense?
A4. But why have Codelco do that extra negotiation and not CORFO do it, who is the countersigned party to the prime contract? It is simply hard to fathom why this extra negotiation is needed. I don't know if anyone calmly even reviewed the legal mechanism for Codelco to fulfill that role. I don't know if this idea that Codelco negotiates on behalf of CORFO even has legal support within the framework of public institutions. The other thing that doesn't make sense is asking private companies to make more efforts in salt flats that are more difficult to work than the Atacama.

Q5. In short, you see more weaknesses than strengths in this policy...
A5. I see very few strengths. As I said, opening a window to negotiate with SQM may be reasonable if it is done well, but the requirement that the State is the primary entity that has to control everything is a tremendous mistake. If controlling means that the State is going to start operating what is now SQM, it is a terrible plan. In terms of management, the company does its operational, environmental and commercial monitoring work very well, but if you want the State to take control of that operation then it is a tremendous mistake.

There are many details of this policy that have not been worked out and I am afraid that we are going to spend the next 3 years just discussing this. Unless the negotiation with SQM prospers, which would seem good to me, then we are going to spend the rest of what is left of this government without making any progress in increasing the exploitation mining of lithium, which is what should motivate us.

Q6. Former President Piñera tried twice to bid and it didn't work. Isn't this a better way?
A6. The previous Lithium Tenders (ref 2021) that were tried were on the right path, but we should have socialized the policy more with other participants so that it would have had more bipartisan political support. That is why the fact that this new NLP policy has not been properly socialized with the participants is a mistake. It's like not learning from the past, plus with all the detrimental design issues it has.