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Mexican president says existing mining concessions cannot be used to exploit lithium

Mexico’s president is doubling down on his push to nationalize lithium exploitation in the country, saying that existing mining concessions will not permit lithium mining.

President Andrés Manuel López Obrador said Wednesday that mining concessions in Sonora cannot be used to exploit lithium. Instead, Mexico will start a state-owned company.

"No, no, lithium will be exploited by the nation. Lithium, so it is clear, does not even belong to the government or to the state. Lithium belongs to the people and the Mexican nation," he said during his daily press conference. "We're going to create a Mexican business, that belongs to the country, for lithium."

The push to nationalize lithium is part of an energy reform currently awaiting congressional approval. And while López Obrador previously said existing lithium concessions would be respected, he now says they are only valid for other kinds of mining projects.

"Lithium is something different. It's a strategic mineral, and it belongs to the country. It's not like gold. It's not like silver. It's not like copper, or anything else," he said.

And energy sector expert Carlos Flores said the pending reform does not guarantee existing concessions will be protected.

"It's true on the one hand that the president has said during his morning conferences that he would respect concessions that had already been given in the past. But on the other hand, the reform doesn't say that. It doesn't specify that. It only says that the government won't give concessions. It doesn't specify what will happen to those who already have one," he said. "And that's where the uncertainty comes from for companies that already have a concession."

It is now unclear what the future holds, for example, for a massive lithium deposit in Sonora, where a mining project recently acquired by Chinese lithium company Ganfeng is currently under construction.

However, it's clear the president does not want to see that project go forward. And Flores thinks it's likely that at least the portion of the energy reform nationalizing lithium will pass later this year.

"But the reform doesn't say what Mexico will do with that lithium," he said. "The reform seeks to establish that the nation is the only one who can exploit it. Ok. But then what? What comes next? What is Mexico planning to do with this mineral if it does control it? I think that's something legislators who are considering passing this reform should be asking themselves."

Kendal Blust was a senior field correspondent at KJZZ from 2018 to 2023.