Codelco has confirmed a partnership with Rio Tinto (ASX:RIO) to develop the Maricunga lithium project in northern Chile. The deal marks a significant move for both companies and reshapes the competitive landscape of Chile’s lithium industry, long dominated by Sociedad Química y Minera de Chile (SQM) and Albemarle Corp. The announcement, made on Monday, brings a global mining heavyweight into Chile’s lithium sector for the first time. Rio Tinto will invest up to $900 million in the Maricunga venture, taking a 49.99% stake. Codelco will retain majority control. This aligns with Chile’s government-backed strategy for greater state involvement in lithium extraction, using Codelco as its main operator.

The Maricunga salt flat, though still untapped, holds some of the highest known concentrations of lithium in brine globally. This makes it a strategic site for any company looking to break into large-scale lithium production in South America. The project now sits at the center of a global race to secure lithium, driven by surging demand from electric vehicle and battery manufacturers. As part of the agreement, Rio Tinto will pay $350 million when the deal is finalized, which both companies expect to occur in the first quarter of next year. An additional $500 million will follow if the venture reaches a final investment decision. If commercial production begins by the end of 2030, Rio will contribute another $50 million.

The deal adds momentum to Rio Tinto’s lithium ambitions, which began with its $825 million acquisition of the Rincon lithium project in Argentina in 2021. That marked its first serious move into lithium, despite being a latecomer compared to more established players.

Jakob Stausholm, Rio Tinto’s CEO, said the company intends to bring “significant investment” to Chile’s lithium sector. He also highlighted the possibility of integrating infrastructure and reducing water usage by aligning this project with Rio’s existing Nuevo Cobre copper exploration project, also in northern Chile and jointly operated with Codelco.

Analysts have pointed out that the deal represents a major shift in Chile’s lithium policy and market. With Codelco taking a leading role and Rio Tinto providing the capital and expertise, the partnership could enable Chile to strengthen its position in the global lithium supply chain. Cesar Perez, an analyst at BTG Pactual, said the venture supports the country’s strategic goal to reclaim its position as the world’s top lithium producer while also helping Codelco diversify beyond copper.

Currently, SQM and Albemarle remain the main operators in Chile’s lithium industry. But the government has sought to introduce new players and increase state oversight, especially in light of growing international demand and geopolitical interest in critical minerals. The “lithium triangle” in Chile, Argentina, and Bolivia contains the world’s largest reserves of lithium, and several nations and corporations have moved to secure their share.

Rio’s involvement not only adds financial muscle to Maricunga but also signals a shift in how global mining companies view lithium. Until recently, Rio’s business focused heavily on iron ore, copper, and aluminum. Its entrance into lithium comes amid broader efforts to align its portfolio with the transition to cleaner energy technologies. JP Morgan noted in a recent client update that Rio has made clear it intends to move quickly in building a lithium business in South America. With the Maricunga partnership, the company is no longer on the sidelines. Instead, it’s placing a large bet on Chile and, by extension, on the region’s role in the future of electric mobility.

For Chile, this could be the start of a new chapter in its lithium story. State control remains central, but international capital and expertise are now part of the equation.

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.

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