Sociedad Química y Minera de Chile

State company (1968–1983)

The company was created in 1968 as a Sociedad Minera Mixta between private investors and the State of Chile (Compañía Salitrera Anglo-Lautaro 62.5% and CORFO 37.5%). The new company was made up of the combination of the deposits and assets of the Compañía Salitrera Anglo-Lautaro and the Empresa Salitrera Victoria owned by CORFO.

At the end of 1966, the problem of the expiration of the state enterprise managed by COVENSA July 30, 1968, and how to organize the nitrate industry arose. Negotiations with Anglo-Lautaro to establish a partnership led to the creation of SQM, with the intent to restructure the declining nitrate production, increase investment and improve exploitation. As a result, SQM was given a monopoly in the exploitation and commercialization of nitrate.

In 1971, the State of Chile, through CORFO, acquired 100% of the property and with this, the exploitation of nitrate was nationalized.

Private company (1983–)

Between 1983 and 1988, it was privatized again during the military dictatorship, transferring the Chilean state company to Julio Ponce Lerou, the then son-in-law of Augusto Pinochet, for 20,300 million pesos through the transfer of 93% of the State shares despite the fact that the value was approximately 35,800 million pesos.

In 1993, the operations of the technical grade potassium nitrate plant began.

In 1995, SQM was listed on the New York Stock Exchange and started the production of potassium chloride from the Salar de Atacama. Production of lithium carbonate from the Salar del Carmen started in 1997. In the years that followed, the business was internationalized through acquisitions and joint ventures:

acquisition of Kemira Emirates Fertilizer Company (2005),

takeover of the iodine business of DSM (2006),

Specialty plant nutrition

This product range is based mostly on formulated potassium nitrate. In 2019 its revenue was $724mio.

Lithium

In the Salar de Atacama in the Atacama Desert of Northern Chile, SQM produces lithium carbonate and hydroxide from brine. As of 2020, SQM reported a capacity of 70kt of lithium carbonate with plans to expand to 150kt/y by 2020. There is some capacity to convert the carbonate to lithium hydroxide in Salar de Carmen. 2019 revenues from lithium were $505mio. In 2021, the lithium revenues were US$936.1 million.

The process involves pumping up lithium rich brine from below the ground into shallow pans. Water is evaporated thanks to the strong sun and dry air. The brine contains many different dissolved ions, and as the concentration increases, salts precipitate out of solution and sink. The remaining liquid (the supernatant) is used for the next step. In the first pan, halite (sodium chloride or common salt) crystallises. This has insufficient economic value and is discarded. The supernatant, with ever increasing concentration of dissolved solids, is transferred successively to the Sylvinite (sodium potassium chloride) pond, the Carnalite (potassium magnesium chloride) pond and finally a pond designed to maximise the concentration of lithium chloride. The process takes about 15 months. The concentrate (30–35% lithium chloride solution) is trucked to Salar del Carmen. There, boron and magnesium are removed before, by addition of sodium carbonate, the desired lithium carbonate is precipitated out. SQM sells potassium chloride made from Sylvinite and potassium nitrate derived from the Carnalite.

There is considerable focus on the use of water in this water poor region. SQM commissioned a life-cycle analysis which concluded that water consumption for SQM's lithium hydroxide and carbonate is significantly lower than that of the average for production from the main ore-based process, using spodumene, and in to environmental report claims that environmental KPIs such as animal populations are not affected by extraction. According to Volkswagen, there is an unresolved dispute about whether brine extraction causes an influx of fresh water and thus influences the groundwater at the edge of the salt flats. Copper mining, tourism, agriculture also consume significant water and climate change cannot be dismissed.

Controversies

People associated with former senior managers in the company were in 2016 and 2017 investigated by the Chilean national police in relation to allegations of tax evasion and bribery. This investigation was referred to by La Nación, a major Chilean newspaper, as "the SQM Affair".

On January 13, 2017, as part of an investigation by the U.S. Securities and Exchange Commission into violations of the Foreign Corrupt Practices Act, SQM agreed to pay a $30 million penalty to resolve parallel civil and criminal cases. According to the investigation, the company made $15 million in improper payments to Chilean political figures and others connected to them in a seven-year period.