Salt Lake Mining Giant Unveils Revamp to Create Leading Lithium Player

China's Qinghai Salt Lake Industry Co. Ltd., a major player in the potash industry, has announced a restructuring plan with state-owned China Minmetals Corp. This move is part of a broader strategy to establish a global lithium powerhouse [para. 1]. The restructuring involves discussions between Qinghai State-owned Assets Investment Management Co. Ltd. (QSAIM), the controlling shareholder of Qinghai Salt Lake Industry, and China Minmetals to develop a premier salt lake industry base in which China Minmetals will hold a majority stake [para. 2].

This partnership could potentially lead to an ownership change for Qinghai Salt Lake Industry, which is known for extracting lithium from brine and owning a significant salt lake in Qinghai province [para. 3]. Currently, QSAIM owns 11.6% of Qinghai Salt Lake Industry [para. 4]. The restructuring aligns with ambitious plans to transform Qinghai into a leading producer of potash and lithium, leveraging the province's abundant salt lake resources [para. 5].

In 2021, the Qinghai government proposed the formation of China Salt Lake Group to capitalize on these local resources and aimed to elevate the industry's value to approximately 120 billion yuan by 2035. This initiative underscores the strategic importance of lithium, especially for sectors like electric vehicles and renewable energy [para. 6]. The proposed merger would include Qinghai Salt Lake Industry, China Minmetals’ salt lake operations, and Qinghai Huixin Asset Management Co. Ltd., resulting in the creation of China Salt Lake Group under the control of China Minmetals [para. 7].

This restructuring is also part of a larger national strategy orchestrated by Beijing to consolidate its lithium industry under central government supervision and create a dominant global entity in this critical sector [para. 8]. Based in Golmud, Qinghai Salt Lake Industry is not only China’s largest potassium fertilizer producer but also contributes significantly to the country’s lithium output with an annual production capacity of 40,000 tons of lithium carbonate. This accounts for about 8% of China’s total lithium supply. Additionally, there are plans to complete an integrated project for producing basic lithium salts by year-end [para. 9].