A Chinese consortium led by battery giant Contemporary Amperex Technology (CATL) is planning to invest $1.4bn (10.05bn yuan) to build lithium extraction plants in Bolivia.

The move is expected to help the development of the country’s largely untapped lithium reserves.

The decision was confirmed by Bolivian President Luis Arce following a meeting with CATL executives, reported Reuters.

The consortium will build two lithium extraction plants, which will be equipped to extract minerals from the country’s Uyuni and Oruro salt flats.

Bolivia’s Ministry of Hydrocarbons and Energy was quoted by Bloomberg News as saying that the investment in the two facilities, which will have a combined production capacity of 200,000 tonnes per annum, could eventually increase to $9.92bn.

Arce said via Twitter: “We met with Burton Roy (Yu Bo), CEO of the Investment Committee of CATL to confirm the investment of $1.4bn.”

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By GlobalData

Construction of the two lithium plants is expected to begin as soon as July 2023.

CATL owns a 66% stake in the Bolivian joint venture CBC. The remaining stake is held by its affiliates CMOC Group and Guangdong Brunp Recycling Technology.

The investment is expected to unlock Bolivia’s potential as a supplier of lithium for batteries, required for the global transition to electric vehicles.

Earlier this year, the CATL-led consortium was selected by Bolivia to develop the country’s huge lithium reserves.

According to the US Geological Survey, Bolivia holds 21 million metric tonnes of lithium resources in its iconic salt flats.