López Obrador to Grant Lithium Concessions to Energy Ministry

President López Obrador disclosed he will hand over all of Mexico’s lithium concessions to the Ministry of Energy (SENER), as experts question the Mexican government’s capacity to extract the mineral. 

During a press conference, López Obrador said that to hand over the concession to SENER, he will sign a decree on Feb. 18, 2023. The president did not elaborate on the content of the decree and the role that Litio Para México (LitioMx), the state lithium company, or the private sector would play. 

The to-be-issued decree is part of a series of efforts from the government to harness lithium as it is considered a key mineral for the energy transition and the administration’s desired energy sovereignty. These moves started with lithium nationalization in April 2022. 

López Obrador also commented that he will visit Sonora to check the progress of the Sonora Plan. During his visit, scheduled to start on Feb. 16, 2023, he will visit Puerto Peñasco to inaugurate the first stage of the solar plant under construction in the area. 

López Obrador will also visit Nogales, Sonora and meet with authorities from Arizona to talk about the projects developed on the other side of the border. 

Furthermore, the president said he will visit the Bacadehuachi mine, Mexico’s largest and most-developed lithium project managed by the China-based Ganfeng Lithium.  

On Jan. 20, 2023, MBN reported that Mexico would start granting concessions for lithium exploitation on Feb. 19, 2023. At that time, the only possible candidate to be awarded the concessions was LitoMx but it remains uncertain what will happen with this promise after the decree is published. Since the company is state-owned, it would not be unusual for a ministry to play a key role in the sector.

The Mining Law reform, which nationalized lithium, was met with skepticism by the private sector and industry experts, who questioned the government's capacity to kickstart commercial lithium production. According to recent statements, the government is open to working with private companies but every project has to be developed alongside LitioMx, which will hold the largest stake, according to Pablo Taddei, Director General, LitioMx.

Taddei has also mentioned that the government was considering giving tax incentives to attract more investors to lithium extraction. “These must be attractive partnerships both for them and for us. We are open to giving incentives so that it is a win-win relationship,” Taddei said.