Sociedad Química y Minera de Chile (SQM) is a Chilean chemical company and a supplier of plant nutrients,

iodine Iodine is a chemical element; it has symbol I and atomic number 53. The heaviest of the stable halogens, it exists at standard conditions as a semi-lustrous, non-metallic solid that melts to form a deep violet liquid at , and boils to a vi ...

lithium Lithium (from , , ) is a chemical element; it has chemical symbol, symbol Li and atomic number 3. It is a soft, silvery-white alkali metal. Under standard temperature and pressure, standard conditions, it is the least dense metal and the ...

and industrial chemicals. It is the world's biggest lithium producer. SQM's natural resources and its main production facilities are located in the

Atacama Desert The Atacama Desert () is a desert plateau located on the Pacific Ocean, Pacific coast of South America, in the north of Chile. Stretching over a strip of land west of the Andes Mountains, it covers an area of , which increases to if the barre ...

Tarapacá San Lorenzo de Tarapacá, also known simply as Tarapacá, is a town in the region of the same name in Chile. History The town has likely been inhabited since the 12th century, when it formed part of the Inca trail. When Spanish explorer Diego ...

and

Antofagasta Antofagasta () is a port city in northern Chile, about north of Santiago. It is the capital of Antofagasta Province and Antofagasta Region. According to the 2015 census, the city has a population of 402,669. Once claimed by Bolivia follo ...

regions.

History

State company (1968–1983)

Created in 1968 as a ''Sociedad Minera Mixta'' between private investors and the State of Chile (Compañía Salitrera Anglo-Lautaro 62.5% and

CORFO The Production Development Corporation (CORFO, from ) is a Chilean governmental organization that was founded in 1939 by President Pedro Aguirre Cerda to promote economic growth in Chile. Originally, CORFO was responsible for the creation of ...

37.5%). The new company was made up of the combination of the deposits and assets of the Compañía Salitrera Anglo-Lautaro and the Empresa Salitrera Victoria owned by

. At the end of 1966, the problem of the expiration of the state enterprise managed by COVENSA July 30, 1968, and how to organize the

nitrate Nitrate is a polyatomic ion with the chemical formula . salt (chemistry), Salts containing this ion are called nitrates. Nitrates are common components of fertilizers and explosives. Almost all inorganic nitrates are solubility, soluble in wa ...

industry arose. Negotiations with Anglo-Lautaro to establish a partnership led to the creation of SQM, with the intent to restructure the declining nitrate production, increase investment and improve exploitation. As a result, SQM was given a monopoly in the exploitation and commercialization of nitrate. In 1971, the State of Chile, through CORFO, acquired 100% of the property and with this, the exploitation of nitrate was nationalized.

Private company (1983–)

Between 1983 and 1988, it was privatized again during the

military dictatorship A military dictatorship, or a military regime, is a type of dictatorship in which Power (social and political), power is held by one or more military officers. Military dictatorships are led by either a single military dictator, known as a Polit ...

, transferring the Chilean state company to Julio Ponce Lerou, the then son-in-law of

Augusto Pinochet Augusto José Ramón Pinochet Ugarte (25 November 1915 – 10 December 2006) was a Chilean military officer and politician who was the dictator of Military dictatorship of Chile, Chile from 1973 to 1990. From 1973 to 1981, he was the leader ...

, for 20,300 million pesos through the transfer of 93% of the State shares despite the fact that the value was approximately 35,800 million pesos. In 1993, the operations of the technical grade potassium nitrate plant began. In 1995, SQM was listed on the

New York Stock Exchange The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District, Manhattan, Financial District of Lower Manhattan in New York City. It is the List of stock exchanges, largest stock excha ...

and started the production of

potassium chloride Potassium chloride (KCl, or potassium salt) is a metal halide salt composed of potassium and chlorine. It is odorless and has a white or colorless vitreous crystal appearance. The solid dissolves readily in water, and its solutions have a sa ...

from the

Salar de Atacama Salar de Atacama, located south of San Pedro de Atacama, is the largest Salt pan (geology), salt flat in Chile. It is surrounded by mountains and lacks drainage outlets. To the east, it is enclosed by the main chain of the Andes, while to the wes ...

. Production of

lithium carbonate Lithium carbonate is an inorganic compound, the lithium salt of carbonic acid with the chemical formula, formula . This white Salt (chemistry), salt is widely used in processing metal oxides. It is on the WHO Model List of Essential Medicines, Wor ...

from the Salar del Carmen started in 1997. In the years that followed, the business was internationalized through acquisitions and joint ventures: * acquisition of

Kemira Kemira Oyj () is a chemical industry group headquartered in Helsinki, Finland. The company was established in 1920 and has developed into a global leader in its two main segments, Industry&Water and Pulp&Paper. Full history including a history v ...

Emirates Fertilizer Company (2005), * takeover of the iodine business of DSM (2006), * Joint Ventures with '' Coromandel '' in India (2009), * '' Qingdao Star '' in China (2009), * '' Roullier '' in France (2009) all for the plant nutrition business, * '' Lithium-Americas Corp.'' in Canada (2016) to run the Cauchari-Olaroz lithium project in

Jujuy San Salvador de Jujuy (), commonly known as Jujuy and locally often referred to as San Salvador, is the capital and largest city of Jujuy Province in northwest Argentina. Also, it is the seat of the Doctor Manuel Belgrano Department. It lies near ...

, Argentina. In 2018, sold its share to

Ganfeng Lithium Ganfeng Lithium Co., Ltd. is a company that produces lithium, lithium products, other metals, and batteries in mainland China and globally. It was founded by Li Liangbin in 2000 and is headquartered in Xinyu, Jiangxi. It is the largest lithi ...

* '' Kidman Resources ''in Australia (2017) to form ''Covalent Lithium'' to manage the mount Holland mine project. Kidman Resources was subsequently taken over by

Wesfarmers Wesfarmers Limited is an Australian conglomerate, headquartered in Perth, Western Australia. It has interests predominantly in Australia and New Zealand, operating in retail, chemical, fertiliser, industrial and safety products. With revenue o ...

. In 2015, the largest shareholder with 32% was the Julio Ponce Lerou's '' Pampa Group ''. In 2015, after flood damage to the

railway Rail transport (also known as train transport) is a means of transport using wheeled vehicles running in railway track, tracks, which usually consist of two parallel steel railway track, rails. Rail transport is one of the two primary means of ...

, nitrate transport to the port by rail was replaced by trucking. In 2018, China's Tianqi Lithium Corp. purchased 23.77% stake in SQM from Canadian mining company Nutrien Ltd. In 2019, Tianqi Lithium has come to an agreement over the governance of SQM with key shareholder Julio Ponce Lerou. In October 2023, SQM acquired a 30% stake in Australia's Pirra Lithium.

Products

Specialty Plant Nutrition

This product range is based mostly on formulated potassium nitrate. In 2019 its revenue was $724mio.

Lithium

In the

in the

of Northern Chile, SQM produces

and

hydroxide Hydroxide is a diatomic anion with chemical formula OH−. It consists of an oxygen and hydrogen atom held together by a single covalent bond, and carries a negative electric charge. It is an important but usually minor constituent of water. It ...

from brine. As of 2020, SQM reported a capacity of 70kt of lithium carbonate with plans to expand to 150kt/y by 2020. There is some capacity to convert the carbonate to lithium hydroxide in Salar de Carmen. 2019 revenues from lithium were $505mio. In 2021, the lithium revenues were US$936.1 million. The process involves pumping up lithium rich brine from below the ground into shallow pans. Water is evaporated thanks to the strong sun and dry air. The brine contains many different dissolved ions, and as the concentration increases, salts precipitate out of solution and sink. The remaining liquid (the supernatant) is used for the next step. In the first pan,

halite Halite ( ), commonly known as rock salt, is a type of salt, the mineral (natural) form of sodium chloride ( Na Cl). Halite forms isometric crystals. The mineral is typically colorless or white, but may also be light blue, dark blue, purple, pi ...

(sodium chloride or common salt) crystallises. This has insufficient economic value and is discarded. The supernatant, with ever increasing concentration of dissolved solids, is transferred successively to the

Sylvinite Sylvinite is a sedimentary rock made of a mechanical mixture of the minerals sylvite (KCl, or potassium chloride) and halite (NaCl, or sodium chloride).Weiss N.L., SME Mineral Processing Handbook 1985, Page 22-2 Sylvinite is the most important s ...

(sodium potassium chloride) pond, the Carnalite (potassium magnesium chloride) pond and finally a pond designed to maximise the concentration of lithium chloride. The process takes about 15 months. The concentrate (30–35% lithium chloride solution) is trucked to Salar del Carmen. There, boron and magnesium are removed before, by addition of

sodium carbonate Sodium carbonate (also known as washing soda, soda ash, sal soda, and soda crystals) is the inorganic compound with the formula and its various hydrates. All forms are white, odourless, water-soluble salts that yield alkaline solutions in water ...

, the desired lithium carbonate is precipitated out. SQM sells potassium chloride made from Sylvinite and potassium nitrate derived from the Carnalite. There is considerable focus on the use of water in this water poor region. SQM commissioned a life-cycle analysis which concluded that water consumption for SQM's lithium hydroxide and carbonate is significantly lower than that of the average for production from the main ore-based process, using

spodumene Spodumene is a pyroxene mineral consisting of lithium aluminium inosilicate, Li Al( Si O3)2, and is a commercially important source of lithium. It occurs as colorless to yellowish, purplish, or lilac kunzite (see below), or alternatively yellow ...

, and in to environmental report claims that environmental KPIs such as animal populations are not affected by extraction. According to Volkswagen, there is an unresolved dispute about whether brine extraction causes an influx of fresh water and thus influences the groundwater at the edge of the salt flats. Copper mining, tourism, agriculture also consume significant water and climate change cannot be dismissed.

Iodine

In 1995, Ajay Chemicals formed a joint venture with SQM, holder of the world's largest known iodine reserves. Partnering with Ajay, the AJAY-SQM GROUP added Ajay-SQM Chile SA. This

vertical integration In microeconomics, management and international political economy, vertical integration, also referred to as vertical consolidation, is an arrangement in which the supply chain of a company is integrated and owned by that company. Usually each ...

with Ajay made SQM-Ajay the world's largest producer of iodine derivatives. Through the 2006 acquisition of DSM Minera's iodine derivatives plant in northern Chile in 2006, Ajay-SQM Group added a fourth manufacturing site. The main application is X-ray contrast media. In 2019, its revenue was $371mio.

Potassium

SQM sells three potassium compounds, potassium chloride, nitrate and sulfate for a total revenue of $213mio in 2019. The chloride is obtained as a by-product from lithium production and sold for oil drilling, while the nitrate is made by combining sodium nitrate extracted from caliche and evaporation. It is sold as a fertiliser or a component of the heat transfer fluid in solar thermal power stations. SQM processes potassium nitrate at the Coya Sur plant in María Elena at 1,200 m altitude, and drives it 80 km to the port in

Tocopilla Tocopilla is a city and commune in the Antofagasta Region, in the north of Chile. It is the capital of the province that bears the same name. Every year Tocopilla celebrates its anniversary on 29 September with a big show the day before, which ...

, including in an electric truck.

Industrial Chemicals

* Sodium Nitrate, from leaching

caliche Caliche () is a soil accumulation of soluble calcium carbonate at depth, where it precipitates and binds other materials—such as gravel, sand, clay, and silt. It occurs worldwide, in aridisol and mollisol soil orders—generally in arid or se ...

. This is the historical business on which the company's ancestors were built. Major applications include glass, ceramic, explosives and metal treatments. The other products in the is category are obtained directly or by a simple conversion from the evaporites obtained in the concentration of brine for lithium production * Potassium nitrate, from sodium nitrate (from caliche) and potassium chloride from lithium production. Major applications include

crystal glass Lead glass, commonly called crystal, is a variety of glass in which lead replaces the calcium content of a typical potash glass. Lead glass contains typically 18–40% (by mass) lead(II) oxide (PbO), while modern lead crystal, historically ...

, enamels, metal treatment and

gunpowder Gunpowder, also commonly known as black powder to distinguish it from modern smokeless powder, is the earliest known chemical explosive. It consists of a mixture of sulfur, charcoal (which is mostly carbon), and potassium nitrate, potassium ni ...

. *

Potassium sulfate Potassium sulfate (US) or potassium sulphate (UK), also called sulphate of potash (SOP), arcanite, or archaically potash of sulfur, is the inorganic compound with formula K2SO4, a white water-soluble solid. It is commonly used in fertilizers, prov ...

comes from the Salar de Atacama brines. The major application is in the manufacture of

drywall Drywall (also called plasterboard, dry lining, wallboard, sheet rock, gib board, gypsum board, buster board, turtles board, slap board, custard board, gypsum panel and gyprock) is a panel made of calcium sulfate dihydrate (gypsum), with or with ...

panels. * Potassium Chloride also from lithium production. The major application is as a stabilizer for oil drilling. *

is another by product of brine concentration in the Salar de Atacama, in which sodium and potassium chloride cocrystallize. The major application is a low-sodium substitute for salt in the food industry. *

Bischofite Bischofite is a hydrous magnesium chloride mineral with formula MgCl2·6H2O. It belongs to halides and is a sea salt concentrate. It contains many macro- and micro-elements vital for human health, in much higher concentrations than can be found ...

(Magnesium Chloride Hexahydrate) major applications include stabilizer, dust control and de-icing agent on roads. * Salt (Sodium Chloride) also known as halite. * Solar Salts: 60% sodium nitrate and 40% potassium nitrate used for energy storage in solar thermal power stations Total 2019 revenue for these products was $95mio.

Controversies

People associated with former senior managers in the company were in 2016 and 2017 investigated by the Chilean national police in relation to allegations of tax evasion and bribery. This investigation was referred to by ''La Nación'', a major Chilean newspaper, as "the SQM Affair". On January 13, 2017, as part of an investigation by the

U.S. Securities and Exchange Commission The United States Securities and Exchange Commission (SEC) is an independent agency of the United States federal government, created in the aftermath of the Wall Street crash of 1929. Its primary purpose is to enforce laws against market m ...

into violations of the

Foreign Corrupt Practices Act The Foreign Corrupt Practices Act of 1977 (FCPA) (, ''et seq.'') is a United States federal law that prohibits U.S. citizens and entities from Bribery, bribing foreign government officials to benefit their business interests. The FCPA is applic ...

, SQM agreed to pay a $30 million penalty to resolve parallel civil and criminal cases. According to the investigation, the company made $15 million in improper payments to Chilean political figures and others connected to them in a seven-year period.

References

External links

* {{DEFAULTSORT:Sociedad Quimica y Minera Companies listed on the Santiago Stock Exchange Companies listed on the New York Stock Exchange Companies in the Índice de Precio Selectivo de Acciones Companies in the S&P Latin America 40 Fertilizer companies of Chile 1968 establishments in Chile Lithium mining companies of Chile Electric railways in Chile 3 ft 6 in gauge railways in Chile Companies established in 1968 Mining companies of Chile