INTERVIEW: EU policy favors SQM entry into European lithium with Swedish JV: Talga exec

The EU's new regulatory mandates for critical minerals could work in favor of a Chilean mining powerhouse's first foray into European lithium, according to Mark Thompson, managing director of Talga Group Ltd.

Chile-based Sociedad Quimica y Minera de Chile SA, or SQM, signed an earn-in agreement with Talga, an Australian company, in June 2024. Under the deal, SQM can acquire up to a 70% interest in the Aero lithium project in northern Sweden in three stages by spending up to $19 million on exploration over seven years. Talga will retain the graphite rights at Aero.

However, Talga has "had extensive mine permitting issues in Sweden" for its graphite and anode projects, Thompson said Feb. 21 during the Benchmark World Tour forum in Perth, Australia. He emphasized that Sweden will need to act quickly with the new EU mandates.

"Sweden has a system where almost every government or any authority or administration decision can be appealed twice," Thompson told Platts, part of S&P Global Commodity Insights, on the sidelines of the forum. "This just drags on the process and makes it extremely long and difficult for everyone to stay on."

The EU was perceived as late in adding lithium to its list of critical raw materials in September 2020. Subsequently, the key battery metal was included in the EU's Critical Raw Materials Act, adopted in March 2024. The act aims to "reduce the administrative burden" and streamline permitting procedures for critical raw materials projects.

The EU has essentially introduced accelerated permitting for member states if the commodity being mined or processed is a critical mineral, Thompson said. "So, I do not think the future of the Aero project will be as slow as what we have been through prior to this political change," he told Platts.

SQM's expansion into Europe

SQM entered the Aero joint venture via subsidiary SQM Australia Pty. Ltd. The Chilean company does not have any mineral projects in Europe, according to S&P Global Market Intelligence data, though its SQM Europe NV unit distributes and markets specialty plant nutrients, chemicals and industrial products.

SQM recently established an international lithium division, and its officials have informed Thompson that the miner wants to "expand into different parts of the world and have a range of projects at different levels of development from super grassroots all the way up," the executive told Platts.

"They chose us as one of those [expansion projects] on the basis of our results" from Aero in August 2023, Thompson said, referring to Talga's discovery of large lithium-bearing pegmatites with grades of up to 1.95% lithium oxide at the surface. Geophysical and spectral data were also analyzed to identify new lithium targets.

Geochemistry also identified gallium and cesium at Aero, which "seem to be of interest" to SQM, Thompson said. Gallium is a strategic material, and China banned its exports as a semiconductor material in late 2024. Additionally, Cesium has been declared critical by the US government.

Drilling has not yet started at Aero as SQM is still going through Sweden's new foreign investment review process, but Thompson said Talga has already defined 50 km of pegmatite on a project that spans 270 sq km.

"To get high grades like that the first time we have looked at it, in an area that we control 100%, shows that the fertility and prospectivity are very high. It is like owning all the Pilbara from scratch when it comes to its prospectivity for lithium," Thompson said.

The Pilbara region is responsible for much of the lithium production in Australia, which is the world's biggest lithium exporter.