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Indigenous review is crucial for Codelco-SQM lithium deal

in

Chile

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Local groups demand new methodology and more information

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Court orders state agency Corfo to respond in 15 days

By Daina Beth Solomon

SANTIAGO, July 15 (Reuters) - Two Indigenous groups in

northern Chile have asked a local court to suspend a state-led

community review process that is required for a lithium

partnership between copper giant Codelco and lithium miner SQM

, according to legal documents reviewed by Reuters.

The Indigenous community of Coyo and the Atacameno

Association of Irrigators and Farmers of San Pedro de Atacama

each independently filed legal challenges last week with a

Chilean appeals court in the Antofagasta region, accusing

Chilean economic development agency Corfo of not properly

carrying out a consultation process to seek their input on the

partnership.

The process is one of the final conditions for a deal to go

into effect in which state-run Codelco will take a majority

stake in SQM's lithium mining operations in the Atacama salt

flat.

The Coyo community and the Atacameno Association of

Irrigators and Farmers, which has Indigenous members, said they

needed more information and time to be able to provide informed

consent on the plan.

The Antofagasta court on Friday accepted their challenges,

according to a court document. It ordered Corfo to respond to

the allegations within 15 days, and asked Codelco and SQM to

provide comments.

Corfo told Reuters that the consultation process was still

in progress.

"The Indigenous consultation process with the Atacama

Indigenous organizations is moving forward and has been carried

out in accordance with the regulations," the agency said in a

statement.

Codelco declined to comment, while SQM did not immediately

reply to a request for comment.

The Indigenous consultation, which was led by Corfo and

included a few dozen community groups located around the Atacama

salt flat, was due to conclude around late July.

SQM and Codelco are separately holding talks with

communities near the salt flat to discuss a model for Indigenous

oversight over lithium extraction.

The Coyo community and Atacameno Association of Irrigators

and Farmers both asked the court to suspend the process until a

new methodology for the community review could be implemented,

and more information provided.

Both groups said Corfo had not provided enough detail about

the proposed contract between Codelco and SQM and argued that

the consultation's timeline between November 2024 and July 2025

was too fast to allow for detailed analysis.

They also said Corfo at several points did not act in good

faith, and did not meet the standards set out by the

International Labour Organization, a U.N. agency.

"This situation directly affects the fundamental rights of

the Community by limiting its influence over decisions that

impact its territory, environmental surroundings, and collective

rights, thereby violating constitutional guarantees," the Coyo

community said in its court filing.