Sebastian Pinera, formerly president between 2010 and 2014, beat his rival Alejandro Guillier in the second-round run-off poll this week, and will be sworn into office in March for a new four-year term, enacting plans to support the mining sector, which is a key player in the Chilean economy, removing barriers to obtaining environmental approvals. 

The change of government dovetails with a completion of a preliminary economic assessment for Maricunga completed by WorleyParsons.

Sydney-based LPI said the PEA supports the development of a 20,000 tonne per annum lithium carbonate and 74,000tpa potassium chloride fertiliser project over two decades.

Work by the company estimates a net present value of US$1.049 billion before tax at 8% discount rate, providing an internal rate of return of 23.4%.

Assuming a two-year ramp-up, payback would be less than three years for LPI’s share of the development costs of $366 million (net $183 million) with a total budget of $527 million to cover the contingency, indirect costs and the fertiliser plant.

The assessment shows that the lithium brine project would be among most efficient LCE producers in the nation with costs of $2938/t, reducing to $2635/t with the fertiliser credits.

The project is now moving into a feasibility study, based around proven lithium brine evaporation pond technologies.

The field would require 13 wells, a central pumping station, and salt removal plant. 

A hydrogeological model is being completed, and once integrated with the PEA will form an effective prefeasibility study.

Maricunga is located in northern Chile’s so-called “lithium triangle” and is held by in the Minera Salar Blanco joint venture with a Chilean investor (32.3%) and Li3 Energy (17.7%). 

It has a maiden resource of 2.15Mt LCE, and has recently attracted interest from Fulin Group as a potential backer.

The JV and Fulin recently signed a draft memorandum of understanding that could see the Chinese company buy up to half of the project.

LPI, which is still completing its final A$7.5 million earn in payment, recently raised $35.6 million via a fully underwritten placement and option agreement.

LPI shares were off 5% to 56c, valuing the company at $146 million.