Bolivia picks Chinese firms for $1 billion lithium project

A group of Chinese firms is partnering with YLB, Bolivia’s state-owned lithium mining company, to build a $1 billion project to exploit Bolivia’s large and mostly untapped lithium resources.

In 2021, YLB started soliciting proposals to mine Bolivia’s lithium using direct lithium extraction (DLE), a set of technologies that use sorbents, membranes, or other materials to chemically remove lithium from salty brines. It received submissions from companies in Argentina, China, Russia, and the US.

YLB has announced that it will move forward with a group that includes the battery company Contemporary Amperex Technology Co. Ltd. (CATL), CATL’s recycling subsidiary BRUNP, and the mining company CMOC. They aim to construct two DLE plants, each capable of producing 25,000 metric tons (t) of lithium carbonate annually for use mainly in electric vehicle batteries.

It’s unlikely the project will hit that target, says Andy Leyland, founder of the battery supply chain consultancy SC Insights. He says local opposition and changes in political leadership have stopped Bolivian lithium projects in the past, and those factors remain a challenge for this venture.

Joe Lowry, a consultant to the lithium industry, also has doubts that the project will succeed, noting that companies have been trying to mine Bolivia’s large lithium resources for decades. “They never seem to finalize a deal,” he says.

Bolivia has 21 million t of lithium resources, more than any other country, according to the US Geological Survey. YLB does extract some lithium using conventional brine evaporation but so far hasn’t achieved large-scale production. Neighboring Argentina and Chile, meanwhile, together account for close to 40% of the world’s lithium production.

In addition, Leyland says, relying on DLE is risky because the technology has not been proven at large scale. None of the companies in the Chinese group have produced lithium using DLE, and Leyland says they may end up outsourcing the technology to another firm. Some of the seven firms that lost out, such as Lilac Solutions and Fusion Enertech, do have DLE technology. “Even if it starts working at a pilot plant . . . you’ve got challenges when you scale things,” he says.

At a press conference in La Paz, Bolivia, the group didn’t reveal much information about its technology but claimed it could extract 90% of the lithium from brines.

Leyland says it’s worth noting that CATL is the world’s largest lithium chemical consumer, and the company is highly motivated to secure supplies to fuel its battery business. “If it works, the taps are open,” he says. “They need the lithium.”