Original article: Roskill
In a move to help grow state revenues from mineral production, a bill proposing a 3% royalty on lithium production has been presented to Chile’s lower house. The bill proposes applying the 3% royalty to the nominal value of minerals extracted for production levels of 50ktpy LCE or greater. Proceeds from the royalty will be used exclusively to undertake development works in the communities where the respective deposits are located, aiming to help mitigate the environmental effects produced by mining activity.
In a recent release, SQM stated its intention to produce 70kt LCE in 2020 as part of a strategy to grow its presence in China, as well as building strategic inventory. Assuming an average selling price of US$7,500/t Li2CO3, the royalty payments would create a total of US$15.75M revenue for the Chilean state. In addition to the existing sliding scale royalty applied by CORFO, the new royalty from an operational perspective would increase SQM’s OPEX by US$225/t LCE.
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