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The Ministry of Mining accepted application from CODELCO to extend CEOL, page-6

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MrPM22

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27/10/22

09:49

Post #: 64423501
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Originally posted by Photosynthesis: ↑

Something just was announced there are many articles published in the last few hours about how the Ministry of Mining has accepted an application for review/processing from CODELCO to extend its current lithium CEOL in the maricunga to include all of maricunga. If my understanding is right what CODELO is asking for is to remove all other maricunga stakeholders lithium CEOL's that were grandfathered from mining concessions made before 1979 that did not include lithium as being part of them. The minisitry of mining says it will have talks with all stake holders and companies such as Salar Blanco and will have a definitive decision by the end of the year. Seems like the worse case scenario is we lose our CEOL and have to make a MOU with codelco to include our phase 1 project, we already have a non-binding MOU with codelco for a phase 2 project. Although I do not think the ministry of mining is going to remove the grandfathered concessions that the government has acknowledged for the last 40+ years because this might be harmful for attracting investment in projects from institutional foreign financiers which is something the ministry of mining will be hoping for in its new upcoming NLC plan. What do you guys think? I am still doing research on this and learning about the topic. I will let you know of what I find out. It would be great to hear from the CEO.

Here is the link to one article about the topic.

Here is the text from the article:

Codelco could become the only firm authorized to exploit lithium in Maricunga26 October, 2022
This is a new interpretation of the requirements to extract the mineral, which in Chile is not concessionable. The resolution would be known this year.An important dispute is the one that could be unleashed in the local lithium industry, after on Monday, the Ministry of Mining accepted for processing a legal appeal presented by the state mining company Codelco, to modify thelegal interpretation of the existing properties in the Maricunga salt flat, the second most important after the Atacama salt flat.As confirmed by the Minister(s) of Mining, Willy Kracht, the state firm requested for the third time to extend the Special Lithium Operation Contract (CEOL) that it received in 2018 —which was not processed on the two previous occasions by the previous government. —, and this time it was accepted for processing, seeking that the permit be for the entire deposit located in the Atacama Region.“The application was accepted for processing; we reviewed the arguments and we think it is worthwhile, so we have opened the formal review process. If the CEOL prospers and extends to the entire Maricunga salt flat, Codelco would be the only one that could exploit lithium in the salt flat,” commented Kracht.It is worth remembering that in Chile lithium has been declared of national interest and not concessionable, but until now there was theconception that its exploitation was free for the holders of the concessions covered by the 1932 Mining Code and in force until 1979 (year in the current regulation comes into force). This argument is refuted by the state mining company and could leave other companies that are developing projects in Maricunga, including Salar Blanco and Simbalik, without options.In order for a private company to exploit lithium, it requires a CEOL, which is delivered by the Ministry of Mining, andto date, the only one that has been granted is that of Codelco, to which Enami could be added, which also made a request this year. Both state firms have opted for this procedure to develop the lithium business, through a subsidiary in which they can eventually associate with private parties.“According to the legal arguments of Codelco, there would be no lithium property constituted in the salar, this because the property constituted prior to the year 79 had been constituted by non-metallic substances in accordance with the provisions of the Mining Code of 1932, and lithium , being a metallic substance, would not be included in the properties prior to 79, therefore, there is no lithium property prior to 79 in Maricunga, then the CEOL could have been given over the entire extension of the salar, without leaving out those affected by the previous regulation”, indicated the minister(s).Along with this, the state company also requested that the extension of the CEOL be extended by three years, considering thedelays that exist in the process that it is carrying out in Maricunga, due to the pandemic, which has made thecorresponding drilling in the area difficult.The ministry's estimates point to a definitive resolution before the end of the year, and ensured that listening spaces will be opened to those involved in the Maricunga salt flat who may feel affected byCodelco's request."The important thing is to resolve this eventual controversy on its merits, it is very important to give certainty, and in theadministrative process we consider that there is a space for third parties who feel affected to present their defenses," said Kracht.Regarding the participation of private parties in the lithium market, the authority assured that there is space and that precisely in 2023 they will go out in search of a strategic ally within the framework of the National Lithium Company (ENL), but recalled that the objective of this administration is for the State to be a majority shareholder in this type of company.“Our expectation is that any new lithium project in Chile will be in partnership with the State, and that the Statewill have a majority stake, but when we talk about that, we don't just focus on the operation andprocessing, we believe that there has to be a some vertical integration from exploration to development of battery materials. Within each productive unit of the ENL there could be different levels of participation by the State. How this participation is distributed in each unit is something that must be reviewed on a case-by-case basis”, points out the deputy secretary of Mining

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is this for real? Hanging over LPI has been uncertainty like this (think new constitution and original grab by Codelco of Litio 1-6) and now this? The timing is interesting too. It's almost like the Chileans want to suppress the value of the company because they are angling to have a majority share or take it over completely. Can the Chileans be trusted or do they want to rip aussie investors off? EGM tomorrow to make LPI 100% owner and SP could increase significantly. Looks extremely sus to me.

LPI Price at posting: 58.5¢ Sentiment: Buy Disclosure: Held
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