UPDATE 2-Peru wants to seize lithium 'window of opportunity,' says minister

Kitco Media
By Reuters
Published:
Updated:
Reuters
(Adds detail, background) LIMA, April 27 (Reuters) - Peru's economy minister on Thursday said "conditions were being established" to develop lithium mining projects in the country, a week after Chile launched a plan to boost state control of the industry. "A window of opportunity has opened and we want to take advantage of it," said Economy Minister Alex Contreras, saying that there was "a lot of interest" in speeding up development in Peru as decisions in other countries were spooking investors.


Contreras declined to give further detail on what projects were being developed in Peru.


The world's second largest copper producer, Peru currently has a lithium exploration project in the region of Puno, on the border with Bolivia, run by Macusani Yellowcake, a subsidiary of Canada's American Lithium Corp . Nearby Chile, Argentina and Bolivia form the so-called "lithium triangle," which is believed to contain more than half the world's resources across its extensive salt flats.


Prices for the metal - key for powering electric vehicles - have however dipped from last year's records amid high output and weaker Chinese demand.


Chile's move follows a sweeping lithium nationalization plan enacted by Mexico last year, while Bolivia's ruling socialists have also favored state control, though it is counting on Chinese partners to unlock its huge but untapped reserves.


"There are investors interested, not only in lithium but in different economic sectors," said Contreras, saying other industries could benefit from potential investment in lithium battery plants.


New mining operations should be key to growing the nation's economy by an average of 3% annually over the coming years, he added. Peru's government has trimmed down its economic growth forecast to 2.5% for this year.


Peru's mining sector has been hit by extended nationwide protests following the ousting of former President Pedro Castillo in December last year.


Contreras predicted a fiscal deficit of 2.1% of the country's gross domestic product (GDP) this year, adding that private investment in the country was expected to fall in 2023 for a second year in a row.
(Reporting by Marco Aquino; Writing by Sarah Morland and Isabel Woodford; Editing by Brendan O'Boyle and Diane Craft)

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.