SANTIAGO (Reuters) – Chile’s financial growth company CORFO on Wednesday mentioned it reached an settlement with Albemarle (NYSE:) to determine an choice for the U.S. firm to extend its manufacturing quota by 240,000 metric tons of lithium metallic equal (LME).

The enhance would increase Albermarle’s manufacturing quota by near 50%, from about 460,000 metric tons of LME presently.

To entry the upper quota, Albemarle would want to show its capacity to make use of sustainable expertise comparable to direct lithium extraction, seek the advice of native indigenous communities, and procure environmental permits, CORFO mentioned.

The settlement is a part of a settlement reached in April that requires Albemarle to pay $15 million to resolve a criticism made by CORFO in 2021 with the International Chamber of Commerce (ICC), during which it argued the corporate had underpaid commissions to the state.

Albemarle is considered one of two firms producing lithium in Chile, which is the world’s second-largest producer of the white metallic utilized in EV batteries.

“This establishes a series of clauses that let us anticipate production with higher sustainability standards in the Salar de Atacama,” CORFO Vice President Jose Miguel Benavente mentioned in an announcement, referring to the lithium-rich salt flat the place Albemarle operates.

The pact additionally outlines new phrases for setting a “preferential price” for producers of lithium merchandise in Chile. CORFO mentioned the adjustments had been aimed toward serving to these firms “come to an agreement with Albemarle in a better way and with greater flexibility for a long-term supply of lithium carbonate.”

Other phrases from a 2016 settlement with Albemarle stay unchanged, CORFO mentioned, together with the deal’s validity via 2043 and the choice to buy belongings within the Salar de Atacama.

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