Chilean lithium miner SQM says relations with indigenous communities are improving

Chilean company SQM, the world's second largest lithium producer, has a priority commitment to the indigenous communities surrounding the Atacama salt flat, the firm's General Manager Ricardo Ramos said in an interview.

According to the interview, published on Sunday in the newspaper La Tercera, the company is making progress in improving relations with the communities that live in that area of the arid Chilean north through several cooperation deals.

SQM cut a deal with Chile in 2018 allowing it to ramp up output from the Atacama, a remote and fragile desert salt flat whose indigenous inhabitants fear may be jeopardized by mining.

SQM promised up to $15 million annually to promote sustainable development in the communities. But the funds have spawned fresh controversy as a key indigenous association has rejected them, saying they are a distraction from ensuring the environment is protected.

"We are progressing well. Commitment to the communities is a priority," Ramos said in the interview.

SQM emailed a link to the interview to the media on Sunday without any further statements on the issue. Reuters was not immediately able to reach the indigenous communities for comment.

The agreements allow "the development of a new form of relationship that, based on mutual recognition and respect (...) directly addresses concerns and community perceptions," he said.

The standoff has underscored the complex calculations that miners like SQM, which have for decades operated in far-flung regions, must now navigate as foreign governments, carmakers and consumers scrutinize their social and environmental bonafides ahead of the boom in electric vehicle sales.

Lithium is a key ingredient in the batteries that power cell phones and electric vehicles.