Lithium in conflict: a tragedy of the commons in the Argentine Northwest?

Let’s take a small step back and remember why lithium is so required today. One of the vectors to mitigate climate change is to reduce transport emissions: there are electric vehicles that have mineral as a critical input in lithium ion batteries. It is estimated that the demand for the resource will multiply between 10 and 40 times to reach the climate objectives by 2040. Although our country has been one of the few global producers for almost a quarter of a century, the increase in demand —and, therefore, of the price— has generated in recent years a revolution in the Puna shared by the Provinces of Jujuy, Salta and Catamarca. The progress towards the construction stage of a series of projects generates a novelty: the convergence of more than one producer that extracts brine from the same salt flat, eventually affecting the resource of other producers or, in the worst case, the bodies of fresh water near the salt flat. A disturbing conflict of interest at the door.

So how can Ostrom’s ideas help resolve this conflict? She dedicated her life to researching the commons and trying to answer a key question: what is the best way to limit the use of resources while ensuring their long-term economic viability? She started two goals down, because the tragedy of the commons paradigm was the dominant theory when she published her research: “By pursuing their interests and maximizing personal use of the common resource, individuals inevitably produce the depletion of the good.” . In her most emblematic book, The Government of the Commons (1990), Ostrom questioned this notion, analyzing cases from all over the planet: from community management of fishery resources to communal ownership of forests or ecosystems. canals and irrigation. Trained in political economy, she stumbled upon game theory in 1988 and found it very conducive to understanding some of the coordination problems she had begun to study three decades earlier. The analysis of economic governance and the “commons” led her to be, in 2009, at the age of 76, the first woman to be awarded the Nobel Prize in Economics.

The concept of common goods refers to a resource (renewable or not) for whose access there is rivalry but not exclusion, making it desirable to achieve certain “rules of coexistence” for common usufruct. Why can lithium in brines be understood as a common good? There are very few economically exploited mineral resources currently in motion. When we think of a mineral deposit, we imagine a static resource waiting to be found after thousands or millions of years of quiescence: lithium in brines is one of the exceptions. Brines are fluids where lithium is dissolved along with dozens of other elements. This singularity, that of producing from a dynamic resource where the physical limits are not clearly defined, has effects on social, environmental and economic levels.

But does the fact that they have a project under way mean that each producer can pump lithium-enriched brine without restriction within the limits of their concession? No, absolutely not. Each one must obtain a pumping quota authorization from the provincial authority in accordance with the Environmental Impact Assessment (EIA) that is carried out, less than the recharge of the basin. In the case of lithium, it is essential to understand the concept of cumulative impact as an incremental or combined effect on pre-existing or neighboring activities. However, assessing it accurately requires identifying thresholds, which in many cases may not be known until the impact actually occurs. The risk is that of an affectation that is either irreversible or costly in terms of recovery. To avoid it, it is essential to strengthen mitigation and monitoring: the rate of extraction must not affect the water balance of the salt flat and, in addition, the concessionaire must update its EIA every 2 years, an opportunity to adjust the quota if any impact is verified.

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Evaporation ponds in Salar del Hombre Muerto – Sal de Vida Allkem Project.

This is, of course, the description of an ideal situation, but (there is always a but)… what happens if we have a salt flat whose extension crosses the limits of a province, with 2 control authorities and with three producers? Welcome to the Salar del Hombre Muerto. This salt flat is located on the border between Catamarca and Salta and is the one with the best geological conditions to produce lithium in our country. Since 1998, a North American company (Livent) has been operating there, in a Catamarcan concession that occupies approximately a third of the salt flat. A South Korean company (Posco) and an Australian-Japanese company (Allkem) are currently building their operations on the remaining thirds. Since 1943, an unresolved border conflict between the two provinces also underlies the Salar, mainly over Posco’s belongings. Brine, like other fluids, knows no political boundaries. Additionally, Livent’s actions to date have been far from being especially cooperative. An implosive combo.

Is it possible to be optimistic regarding the Salar del Hombre Muerto and regarding other potential cases of “conflicting lithium”? Ostrom gives us, at least, a good horizon of expectation: after years of analyzing these situations, he found that in most cases, the users of the common good developed sophisticated decision-making mechanisms and rules to manage conflicts of interest. and obtain satisfactory results. Public-private cooperation is central, but so is public-public (interprovincial and Province-Nation). The Californian political scientist did not believe in unequivocal State or Market solutions, but rather in the action of the institutions and respect for the rules established between the actors involved.

The effectiveness of these agreements largely depends on their multi-scale organization. The creation of the Lithium Region is a good step on the road to cooperation, but it needs to be provided with skills and financial resources. South-South cooperation also needs to be intensified: this experience was already lived on the other side of the mountain range in the Salar de Atacama, where 4 producers (2 copper and 2 lithium), who extracted water and brine, are working on a model of Governance together with the Chilean Superintendence of the Environment. Jujuy, in the Cauchari-Olaroz basin, is also taking its first steps. A key aspect will be the availability of hydrogeological models (representation of groundwater conditions and their relationships with surface water bodies and atmospheric contributions such as rain or snowfall, for example), ideally reaching a common model between users of each basin, as well as an early warning system (and in real time) for monitoring the water balance. However, not everything is technical information: a condition for the possibility of any institutional arrangement is the understanding of local conditions and community involvement, for which instances of public participation are key.

In short, if someone decides to break the rules and ignore the synergistic effects, they will be harming, on the one hand, their own business and the source of work and income for the territories where they operate; on another scale, he will be damaging the environment that hosts the activity. Its collective nature demands another approach. As Nash and Ostrom taught us, the results of not cooperating end in a greater loss for the whole. Let us make cooperation an emblem for the virtuous development of this sector and a just energy transition. Sustainability is economic, social and environmental, or it is not.

Researcher of the Area of ​​Natural Resources of Fundar.

(**) Researcher in the Natural Resources Area of ​​Fundar.

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Lithium in conflict: a tragedy of the commons in the Argentine Northwest?