By Georg Ismar
In the middle of the world’s largest salt flat in the highlands of Bolivia, you suddenly find yourself in a Chinese village.
Inside one of the prefab huts, a revolving tray of sweet, sour and spicy Chinese dishes has been prepared by Chinese cooks. Notices in Chinese characters are everywhere. The dining room has a karaoke machine, and there’s a ping pong room too.
The China CAMC Engineering Company is building a large plant here for the production of potassium chloride fertiliser. Beginning in 2018, the firm hopes to be producing some 350,000 tonnes of the stuff every year. But the plant also opens the door to a much more important raw material: lithium.
“We’ve only got one salt flat in China, but demand for lithium and potassium chloride there is huge,” says construction director Ji Xinsheng, an affable man who has been living in the more than 10,000-square-kilometre Salar de Uyuni – one of 22 salt flats in Bolivia – since 2016.
Beneath his feet, along with potassium chloride, lie the world’s largest lithium reserves. The buried treasure has attracted the attention of companies worldwide amid the anticipated boom in electric cars, which are powered by lithium-ion batteries.
As Bolivian President Evo Morales sees it, “lithium is the new natural gas.” Rhetorically a socialist but politically pragmatic, he’s looking for international partners to extract the silvery white metal, like the ones that helped to extract the country’s natural gas. That turned what was once South America’s poorhouse into its fastest-growing economy.
The price of a tonne of lithium carbonate has risen from 2,500 US dollars in 2005 to as much as 13,000 today, and has nearly doubled since 2016. Financial experts are touting lithium-related funds as a profitable investment.
Bolivia is thought to have more than 9 million tonnes of the “white gold,” which is also used in rechargeable phone batteries, large batteries for storage of excess solar energy, and medical technology.
So far, Bolivia is only a minor lithium producer – the world leader is Chile, with reserves estimated at 7.5 million tonnes. But Morales says more than 800 million US dollars are being pumped into the country’s fledgling lithium industry.
Access to the guarded production site is restricted. Potassium chloride and lithium carbonate are found in brine under the salt crust there. The brine is pumped into large ponds covering up to 30 hectares, where the water evaporates. The Bolivian government started a small pilot plant to process the lithium carbonate in 2008, and it now produces 5 tonnes a month.
The prospect of large-scale extraction is raising concerns, though. With its otherworldly light displays, lagoons of turquoise, red and green, cactus island and bizarre rock formations, the saltscape is Bolivia’s biggest tourist attraction. The indigenous communities around it fear that irreparable environmental damage could be done.
Addressing these concerns, Juan Carlos Montenegro, director of Bolivia’s lithium programme, emphasises that just 0.4 per cent of the salt flat – about 40 square kilometres – will be industrially exploited – initially.
Next to the Chinese potassium chloride plant, an industrial-scale lithium carbonate plant is to be built for production of about 30,000 tonnes a year. It’s being designed at a cost of 4.5 million euros (about 5.3 million US dollars) by the German company K-UTEC, which signed the contract in 2015 in Uyuni in the presence of Morales, Bolivia’s first indigenous president.
Morales also wants to build a giant lithium-ion battery factory in the nearby city of Potosi. Companies from China, Germany and Canada have bid on the project, in which Bolivia intends to have a majority stake. A total of 26 companies – including from China, Germany, Russia, Finland, Spain and Mexico – are vying to build the lithium carbonate plant.
The “lithium triangle” straddling Chile, Bolivia and Argentina, home to 85 per cent of world’s lithium reserves, is being called “the new” GCC. But in a recent interview with Chilean website Emol.com, Jaime Alee, a lithium expert at the University of Chile, warned of a commodity bubble given the “estimated worldwide reserves of about 40 million tons” but only small amounts of lithium needed for batteries.
Bolivia is pressing ahead. In April, it created YLB, a new state-owned company to boost lithium production that’s expected to employ about 1,000 people.
Montenegro is visibly proud of progress so far, and that Bolivians are calling the shots. In colonial times, the Spaniards mercilessly exploited the silver mines in Potosi, and millions of African and indigenous Bolivian slaves died in the process.
“The Chinese are our partners,” Montenegro stresses, as Ji, standing beside him, looks out at the growing fertiliser plant and smiles affably, as always.
“We’ll give the prefab hut village to our Bolivian friends afterwards,” said Ji, who has reason to be pleased at much more than the plant. The Chinese, after all, are the first with a foot in the door to the lithium trove. – DPA
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