Chile’s state-owned mining company ENAMI announced that its joint lithium project with Anglo-Australian mining giant Rio Tinto (ASX:RIO) will begin production in 2032. The venture, located in the Altoandinos region, is expected to initially yield 35,000 metric tons of lithium annually, with plans to ramp up production to 75,000 tons per year within three years of launch.

The Altoandinos project positions Rio Tinto as a central player in Chile’s lithium industry, a sector currently dominated by SQM and Albemarle. The announcement follows a week in which Rio Tinto was also selected to lead development of the nearby Maricunga project in partnership with state-run copper firm Codelco.

ENAMI president Ivan Mlynarz confirmed the production timeline and output targets during a briefing on Friday. He noted that updated geological studies had identified more lithium resources than originally projected, particularly in the La Isla salt flat. Earlier estimates pegged the project’s annual production capacity at 60,000 tons, but expanded resource estimates have now revised those figures upward.

The Altoandinos venture represents a significant investment. Rio Tinto will contribute an initial $425 million, with total project costs expected to reach $3 billion. ENAMI sees this as a long-term strategic development to diversify Chile’s lithium production and expand its presence in the battery metals supply chain.

One of the project’s most notable elements is its planned use of direct lithium extraction (DLE), a relatively new method that differs from the traditional evaporation pond techniques currently employed in Chile. DLE offers the potential to reduce environmental impact and speed up lithium recovery. Rio Tinto is currently testing its proprietary DLE technology at the Rincon project in Argentina, and ENAMI has begun evaluating similar methods for application in Chile.

Mlynarz said that preliminary testing of Rio Tinto’s DLE approach had yielded promising results, describing them as “encouraging.” He highlighted that Rio Tinto’s dual role as both investor and technology provider could offer a smoother operational path. “It has the advantage of having the operator use their own technology,” he said.

Despite the progress, the partnership still requires approval from international regulatory agencies before it can fully move ahead. In the interim, ENAMI will continue exploration work on the salt flats. The company expects Rio Tinto to take over as the lead operator in 2026.

The announcement comes at a time of increased global interest in lithium, driven by rising demand for electric vehicles and renewable energy storage. Chile, home to some of the world’s largest lithium reserves, has been reshaping its regulatory framework to balance environmental concerns with economic growth from critical minerals.

If the timeline holds, the Altoandinos project will become one of the largest lithium developments in Chile by the mid-2030s, contributing to both national production targets and the global supply of the metal. As the industry evolves, the project will serve as a test case for integrating new extraction technologies into Chile’s resource landscape.

The above references an opinion and is for information purposes only. It is not intended to be investment advice. Seek a licensed professional for investment advice. The author is not an insider or shareholder of any of the companies mentioned above.