Two weeks ago (on October 24th), Macusani's staff presented at a lithium event organized by the Puno Department Council of the College of Engineers of Peru, with the theme "Reality of lithium in the Puno region".
The videos corresponding to part of the Q&A section have been uploaded to youtube, bellow you have the transcripts of the three videos. Interesting statements from Ulises Solis, Gregorio Tasayco (Chief of Explorations) and Rolo Zapana (Head of Metallurgy).
Part 1
Eng. Norman Beltran Castanon (Dean CEP Puno DC). What are the competitive advantages or disadvantages we have when compared to the lithium that our neighbor Bolivia has? Because we know well that the price issue is very important, right? Only that for Mr. Solis. For Mr. Gregorio Tasayco, he has talked a little about the processes. We in the Puno region, and throughout the country, must talk about added value. They have talked about added value, but we would like to know what the vision of the Yellowcake company is, what are those products that they plan to sell to the market, whether local or foreign? For Eng, Jose Malqui, also a geologist, he spoke to us many interesting and new things ... well, at least new to me. What worries me is that they also mentioned that there are no specialists in the region, and that is a national issue. I had a meeting with the national dean, they asked us for opinions to make laws regarding lithium, and we honestly didn't find, or at least I didn't find, specialists about it. So, they indicate that since 2006 they have been exploring this mineral, so what has the company done to train people? Because they talked about the Australian company. We in the academy, in the university, we always look for these relationships, we send students from the University of Puno, from the University of Juliaca, abroad, through scholarships, through internships. So I would like to know what the company is doing about it, especially with young people. What is your policy regarding it? Maybe you has a short, medium term policy.
On the other hand, there has been much talk about processes, such as acidic leaching of lithium, roasting, and also about leaching with water. But I have not seen anything regarding environmental management, the environmental impact it will have in the Corani province, or the social impact it will have there, nothing has been said. That worries, because you has shown support to different peoples, but I would like to know the policy you have to not having problems in the future, as we have had with the Inambari hydroelectric plant, another large project that has been lost, or the oil itself in the Titicaca basin. Then, for not having those clear policies, for not having the clear information, then there are problems and in the end the project dies, and the region is harmed, the country is harmed.
On the other hand, you have also told us a lot about research, about metallurgical processes, but we from the academy, from the university, I repeat again, we are also worried about another type of research. For example, the products that are going to be developed there, or not if no product is going to be developed, research regarding environmental impact, lithium research as an energy resource, and other types of research. The issue of lithium encompasses many things, for example, social research, community research, etc. Only that, the doubts I have. Thank you.
(Applause)
Ulises Solis. The dean is right, who knows about lithium? We didn't know, it's like when I was appointed manager to see a uranium mining company, 2006, who knew about uranium? Who knew about uranium in Peru in that year? Nobody. Who exploited uranium? Nobody. Who exploits uranium? Nobody. Ok, let's talk about lithium. Who exploits lithium in Peru? Nobody. I repeat again, this has been a finding, this is a novelty. There has always been talk of the lithium triangle, formed by Bolivia, Chile and Argentina, but a triangle of salt flats, please understand me well, of salt flats. They do not produce lithium carbonate, they export lithium concentrate. Who wants to produce lithium carbonate, who wants to produce lithium batteries, who wants to add value to lithium is Bolivia, ... but they WANT TO, and are doing a lot of tests, are doing a lot of analysis, invite Germans and everything else, but nobody is going to work for God's sake if the State is going to have more than 51%. Nobody. So the Uyuni project of Bolivia, that Bolivians apologize to me if there is any here, they have 800 ppm, on average, and if anyone knows about salt flats, ... Atacama, for example, is desert, it is a desert salt flat, there is immense heat there, that's why Chile is the first lithium producer in the world. Because they have salts, they have pools, ... you have to make pools to sediment the water, the lithium goes down and then you pump it, and they cannot pump much because if they do so they would destroy the entire landscape. So their production is limited. That is a salar, from which SQM produces. Goodness, wonder, ... because there has to be some God, someone has given this benefit to Puno, that we have found a deposit in rock.
I don't know if you have visited any mining complex, Toquepala, Cerro Verde, or any other, (ours will be) the same kind of mining. Open pit. But it is the obligation of our authorities, it is the obligation of our directors, it is the obligation of the President of the Chapter of Engineers, of the Deans, to promote this type of meetings. I have had several meetings with Mr. Aduviri, with Mr. Agustin Luque (current temporary governor of Puno), and we have told them and we have promised them that we are going to educate people, we are going to... if we end up operating the mining site, and I do want to be emphatic, we are a junior, tomorrow comes a big one, they buys us, and I don't know where I will be looking for work, do you understand? But we want to exploit the site, and we are going to require labor, qualified and unskilled, and the priority is in this order: the communities, the district, the province, the region, and it has to be Puno, and for that you have to prepare yourselves and, who has to prepare you? Your teachers, your authorities, do more events like these, we have no problem, ... this is the first event that the College of Engineers invites us. I am not blaming anyone, we happy to come, our engineers happy to come.
Rolo Zapana is from Puno, is from the University of Puno, and has been with us since the year ... Rolo? (Rolo responds 2011) ... you’re about to retire (laughs). He has been with us for years ... my geologists are from Puno. All the boys who walk the hills are from Puno, and they have also learned. I tell you, those who are geologists, when they took the core, ... here is Eng. Tasayco, who is an engineer with a lot of experience in mining exploration, I ask him to deny me, if when he retired the core, there he is Miguel Cavani, when they removed the core, they knew it was lithium. They did not know. They grabbed their centilometer and measured the radioactivity, measured the counts per second, and there was no uranium. That is why the first drills .... "How are we doing?", "Doctor, low", "Nothing", and a drill came to 142 meters, "why continue drilling if there is no uranium?", "Stop the drill". The other drill, on a single platform, platform number 1 as we say, "Stop it at 172 (meters)", "Stop it at 148". The three drills stopped and when they went to the laboratory, laboratory because we do ICP-mass analysis, the laboratory was the one that said "Hey, look at the amount of lithium there is", and we all went crazy. We turned, ... that's the reality, ... people have to be trained, students have to be trained, they have to be trained. If you have to bring professors, instructors, let Eng. Malqui deny me, he has company called TECMIN, specialists in metallurgical tests, but what do we do in Peru? More of the same, a greater recovery of gold, a greater recovery of silver, greater recovery of copper, lower costs, because that is the job of metallurgists, right? And when we said "Pepe (Jose), uranium," he said "Chis! How is that?” And then, at the end of 2017, “Pepe, lithium”, news, so what have we had to do? Bring outside specialists, foreigners, to train engineers.
(...) And as I say, engineers, we are currently preparing our environmental impact study, something that we have failed to tell you. The plan to take our resources to reserves is done, will be executed by the Redrilsa firm, I hope we start in January or February. But apart from converting resources to reserves in the Falchani area we will also begin in November to expand our explorations, in the community of Quelcaya. That is, these resources that we have located to date will grow. What you see here are superficial tuffs. A lot of people have walked around. No one has seen them. We have a hill called "Tres Hermanas", I do not know if it has been in any of the presentations. In Tres Hermanas, you go with your pillory, if you are geologists, ... it is lithium. You grab this, all these stones have more than 2,000 ppm, and are shallow. So what you have is a blessing from God. When I tell you our cost will be in the $3,000 to $3,200 range, it is because we have arrived to 99.74% purity before refining, and the only strong impurity we find is aluminum. There is aluminum, we are fighting it. In all the metallurgical tests we have done, ... you have seen, we have done thousands of metallurgical tests, we have spent a lot of money in laboratories. So, that is the work that has been done.
The other question was about the social impact. If anyone knows the area, ... there you have a boy from Quelcaya, those are areas that are forgotten by the State. With infrastructure, there is no agriculture, thank God. We are practically over 4,800, 5,000 meters above sea level, that is, there is no river we can affect, there is no lake we can affect, there is no agriculture. There is livestock, and you know that livestock is coming down. Our community of Quelcaya will not let me lie, the fiber is 8 soles this year, a comunero, the largest, has no more than 100 or 150 alpacas, and they cannot be rented all once a year, half is sheared, and with that they have to live all year. So what do they need? Job. As infrastructure, as I repeat, we are going to “sow water”. What is "sowing water"? It rains there every day. And all the water goes to the Atlantic, it doesn't even go to the Pacific, it goes to the Atlantic. So what do we have to do? Sow water, for production, and not just for us, for the communities themselves. The communities do not have a water service. The communities that are with us, which are five, I repeat again, in the district of Corani, they are friendly, they are healthy people, they are honest people. Corani is pro-mining. There is the Corani project itself, the Bear Creek project, which has done a good social work, I will never get tired of saying it, it has done a good social work. Unfortunately, it is a silver mine, and its production cost, just as I told you that our production cost is between $3,000 and $3,200 dollars, their production cost is $22 an ounce. The (silver) price is at $17.50. (...)
Eng. Gregoria Tasayco (Chief of Explorations Macusani Yellowcake). Safety and the environment. We have not touched this topic not because it does not matter, but many times the presentations are very long to plan and something is always forgotten, logically we should have mentioned it. When we arrived at the Isivilla exploration zone, we started with uranium. Not only have we gone and trained people with this new radioactive mineral, which has a lot of rejection in certain places, but more than anything it is due to ignorance. It is thought that uranium, that is, coming into contact with uranium will already affect some parts of your body and will harm your health. Our staff, there in the area, works with some docimeters, which come to be a kind of small rectangles, such as photochecks, which have a crystal. That crystal is responsible for capturing the radiation of the area where the community worker, the engineer, the person who is helping us with work. The driver has his docimeter to control how he is catching the radiation from the environment where he works. The cook has her docimeter, which also captures, in the office we have one, because we always arrive, we have the clothing and leave it there and in the environment this small radiation is spreading.
Let's start by saying that there are three types of radiation: alpha, beta and gamma. The alpha is the very slight one, which with distance or with a simple paper weakens, becomes clogged, no longer passes. Then comes the beta that is seen more than anything in laboratories, in areas where there is greater concentration (of uranium). And the third one is the gamma, which is in reactors, laboratories where the concentration of uranium is very high. In the environment (of Macusani) we have managed to capture up to 4 or 5 millisievert, which is the unit of measurement of radiation that captures this docimeter, and we are plotting it month by month for each worker. Because the norm tells you that, if you have up to 20 millisievert in a year, that person has to be changed from work place; If he is a well performer, change him to an area where there is no greater radiation. This is in general terms, but for exploration (the stage where we are), we reached 4 millisievert, up to 5 when there was a problem of a docimeter that fell to the floor, maybe that's why it reached something of 5 millisievert. The radiation is not strong, therefore it is not harmful.
We have been trained, as mentioned by the previous exhibitors. We have also had training with the ALE Group company, with a group of engineers who see all this part of radiation. We have followed radiological prospecting courses, all this area where they explain step by step how a person is affected in various parts of the body: in the iris, in the lungs, in the gondolas, in different parts of the body. But this, as I repeat, is not our case, but we follow it, we control our staff.
And the issue of what the environment is, the antimineros always tell us "you come here to pollute". But a very simple explanation, and does not mean that we do not want to do anything about it, because the company is making an agreement with the Ministry of Health of the Puno region to do some kind of analysis in all the communities where we are working, to see all These types of diseases, tares and other problems that the villager can suffer from.
One way for us to refute the anti-mining people is: if we live here in the area, the walls become the hills, those hills are the ignimbrite rocks, which have uranium. You analyze that rock and it contains uranium. They take that rock out of there and make their houses, they make their huts with that material. Then, the bed of rock where the stream runs, which is the water they consume, is an ignimbrite rock as well. All the rock in the area is ignimbrite, which has some uranium content. The places where they plant their potatoes, which are one of the most sought-after potatoes in the area, we pass the centilometer equipment and their radiation is high. That is why when we do the monitoring studies we also separate what is soil, water, air, noise, we also do it by taking a potato plant, analyzing its leaves, analyzing the potato itself, we benefit an animal from the area, it can be a ram or an alpaca, the kidneys and liver are removed and also analyzed. But in recent times we have seen that there is no pollution, so something is happening. Or it is very soluble, it is digested and then eliminated, and that is the part that we are trying to know a little more about. (...)
Part 2
Eng. Nestor Chayna Chayna (President of the Mining Engineers Chapter). A question to the general manager, to Dr. Ulises Solis, could perhaps explain a little more, deepen the impact that this finding, this project, would have on the Peruvian economy. Globally, what would be the impact it will cause? Well, the other question would be for the engineer Gregorio Tasayco, who said in his presentation that only a part of all the concessions have been explored, and with that to date we have 4.7 million tons of lithium. I would like to know if these exploration works are going to continue and how much the resources would increase with these explorations, which could be continued later, and with this if we could become the first lithium producer in the world or not. Dr. Ulises also spoke about the visits or internships that are made by the community members to projects outside the Yellowcake project, why don't we also perhaps invite the Mining Engineers College, Puno Departmental Council? Because the project is in Puno, in the region of Puno, to do an internship at its facilities, right?, to be able to see how they are working, and in this way we make a replica to the general public here in the department of Puno. One of the reasons, perhaps, is the social impact that this project will have later on with the exploitation because although it is true the project always speaks of the positive impacts, but it also has negative impacts. I wish you could give us a scope of that, and consider us in an upcoming internship to your project. That would be all, thank you very much.
(Applause)
Ulises Solis. Answering the engineer’s question, you are students, engineers, you handle numbers very well. The site that we have to date, engineers, with 4.7 million tons of lithium carbonate equivalent, at $12,000 a ton is worth more than Las Bambas and Tia Maria together. So the benefits and the economic impact that the site will have, which is in Puno, is super but super strong. And, as engineer Tasayco said, we have only explored a part. What geologists believe, what soil scholars believe is that this has been a salt flat, which has been covered by some volcanic movement, with tuffs and volcanic lavas. That is, it has been covered, do you understand? That is why all this salt flat has solidified, because there are some salt flats in Bolivia, in Chile, in Argentina. And it is possible that here there would have been a salt flat, a huge salt flat… if it is of the size of Lake Titicaca, welcome be it.
So, that's what we are in, but as usual, when you start a business and want to continue growing, you have to start producing and selling what you already have, and that's what we want to do. But in parallel we will continue with the explorations, to continue growing, to see how far the site reaches. That is why I told you just now, we are going to start exploration drilling in the community of Quelcaya, where we have found signs, ... because now we know about superficial tuffs, then there has to be something down, and that's what drilling is for.
One thing that I want to recapitulate a little, about what Eng. Tasayco said regarding uranium. This thing about uranium is a myth gentlemen, that itpollutes, that ... I always set the example, how many cancer patients do you know in Lima?, How many cancer patients do you know in Puno?, How many cancer patients do you know in Juliaca? Do you know how many cancer patients are up there? Zero. And I give you another example. Buy a kilo of ... is there a Plaza Vea here ?, a store of those, buy a kilo of that white, pink potato, buy a couple of kilos of potatoes. In how many days do the roots begin to emerge? It is not that the potato spoils, it is that roots start to come out, right? Take a couple of kilos of that native potato, you can wait for two months and you won’t see any root. Then you can see, it is not polluting and we do monitoring twice a year, and participatory monitoring. What does participatory mean? We do them with the members of the communities themselves, because that is an agreement we have.
And the other thing is, we are not ... we have signed an agreement with the University, with the Faculty of Medicine of the University of Puno, and we have health campaigns every month, in different communities. We go for two days, go the professors, the Dean, students of the Faculty of Medicine, and we do health campaigns in each Community, of course, this month in one, ... for example, the first week of November is our turn in Quelcaya, for you to know. That is to say, we in that sense take care of each other and monitor constantly.
As I tell you, the economic impact is going to be ... I am not authorized to talk about Cesium and what Rubidium, because we have not progressed there yet. But the deposit that you have in your region ... rest assured that you have been blessed. There is no deposit like this, and we are just beginning with this site. (...)
Gregorio Tasayco. Returning to the explorations, logically we will continue. Because we have 93,000 hectares, if we were not interested we would have already left them, we would have abandoned them and they would reverted to the State. But now we have the greatest incentive of having found this area of lithium, we are in the capacity to continue with the explorations. When we focus and say that at the bottom of the ignibrites are the tuffs, that is the richest part, but in the part of the ignibrites where we have a high amount of uranium we have 300, 500, 800, 1,200 ppm in the different communities, that is, we don't stop saying that we have a huge reserve there. While we are doing these works, as Eng. Malqui and Eng. Rolo said, it is a matter of taking the most practical way to have that material found there at 300, 500, 800 ppm, eliminate what is not useful and raise the grades, but we have not done major studies, only from the analyzes that have been made of uranium we know that there is (uranium) content, but that would be a very large reserve if we consider 93,000 hectares. At 100 meters we just make numbers and it is a huge thing. But our goal is not to continue in this part of the ignibrites here, but to go to areas where satellite images indicate that we can have other volcanic craters and find something similar. And that would be great, finding a couple of similar deposits, right? That would be the answer to the concerns, and I want to be concise since that is what they are asking us.
Parte 3
Jess Choquepata Mamani (Gold & Diamond Resources company manager). Lithium, to get an idea, as a representative of the company said, is worth more now than gold, that is, in the future is the world's oil. Globally, everything that is fossil energy is being exchanged for more sustainable energy and lithium is an important part of making batteries. Two of the countries that have rapidly grown in the aspect of lithium have been Argentina and Chile, which have taken the lead and are among the top exporters, only surpassed by Australia.
In one of the exhibitions I heard about aluminum. Aluminum at one time cost less than a dollar, cents. And when they saw its importance it began to multiply by several orders of magnitude, and it cost thousands of dollars, for a short period, until the technology allowed it to be extracted in large quantities, because in reality the aluminum is distributed everywhere, and again its price fell. Lithium, at the moment, is one of the metals that is appreciating very quickly, it has started to rise a few years ago, less than a decade ago, I think, from $5,000 to the $12,000 it is now. And it is being sent as lithium carbonate, but if that same ton becomes a finished product like a battery used, for example, in Tesla vehicles, or cell phones, it can become a million or a million and a half dollars, depending on what product are we talking about. The potential of lithium is infinite, in other words. But it is also not uncommon that if we take a too long time, if we do not have the right technology or technicians, as well as with aluminum, it may happen that the technology advances so fast and that other materials are found that can replace lithium. So, the opportunity is now, right? And the challenge I think is for young people, for students who are here, to prepare a little more to take advantage of this opportunity that comes for the next generations.
The other, I also wanted to emphasize a little the aspect of the Government. From here I would call on the National Government, to think a little more about legislating very important issues. Uranium explorations have been done since many years ago, but there is no regulation on their exploitation. In all countries where uranium is exploited there is a definite regulation. Well, with the apologies of the case, engineers, I must say that uranium does have risks. That is undeniable, otherwise there would not be all those parameters that are used in all the centers where uranium is used as nuclear energy, right? It has risks, like cesium, which they have also found. Nor do we have a protocol to exploit cesium. We are in the exploration phase, right? But we are not going to wait until they go to the exploitation phase to elaborate these respective regulations and protocols. Then I think that it is a very important challenge of our Government, because the one that gives the norms is the National Government, to legislate and to regulate these energies seriously and, in addition, they must be declared in my opinion as strategic resources, as it has been in many other countries that have lithium.
Being such a great opportunity of economic growth for the country, this resource must be treated strategically and policies have to be taught in this regard. Those who govern us do not care about these issues because they are very ignorant of the most important issues in the country. For me Puno is a power that can develop these resources as long as we have adequate policies.
Well, going back to the exhibition, I find everything you have indicated very interesting and this has also shown, as you have seen, and not only has this happened in Peru, right? It has been in Bolivia that they have been trying to investigate the correct way to obtain profits from the resource that is lithium. They have even gone to Japan, which have sent specialists and still have not been able to support them. It is actually a new science that is being created around lithium, because it is a new product that is being used only in these decades.
So, of all this what I can say for the company, what I was saying, it seems that the company does not have established protocols, maybe I did not get it, maybe it would be a matter of knowing that a little better. However, I am also happy to see professionals from here, from Puno, who are working in the company, who are “putting a punch”, as it is commonly said, and it would be good to reinforce the academic aspect, perhaps create an alliance with the University not only to give internships but to create a Research Institute in reference to lithium, to go a little ahead of the facts. As I tell you, each country has a different type of lithium concentration, its lithium has a different structure, which is why you cannot use a single technique for everything. Then each company that is exploiting lithium also has patents, which it does not share with other companies, and that is why each country is generally developing its own technology, aren’t they? So, in that sense, it would be good perhaps, as an initiative, to create a kind of Lithium Institute to quickly work on that issue here in Puno. Just that, for now, thank you very much.
(Applause)
Ulises Solis. It is not that the company does not have protocols. Since 2007 we, and not only us, Vena Resources, Solex, who were at that time, had meetings in Congress with the Energy and Mining Commission to legislate on the exploitation of uranium. And what he says is true, there is legislation, I can exploit uranium tomorrow. But the issue is how do I transport it? How do I market it? That is not regulated, do you understand? So, the law for exploitation exists, what I don't know is how I'm going to transport it, how I'm going to market it. We have presented, I believe, up to 19 bills, and witness to this is Mrs. Susana Vilca, who is your countrywoman, who has been president of INGEMMET, who has been Congressman of the Republic, who is a Mining Engineer, who is a beautiful person, who is a professional in the best sense of the word. We have had two meetings with her. So we have not fallen asleep. And not only at the time of Mrs. Susana, with all governments. But as the engineer who preceded me in the use of the word has said, we have not advanced in that, and we cannot wait for Congress to take something out. In my town there is a saying that says "on the way the load is fixed", right? We have to push, because if we are going to stay waiting, we will remain seated for a lifetime.
So we have to move forward, and as I say something we must have done well in our lives because we have found the lithium deposit. Ok, the uranium will wait, we'll wait there. It is not that we will abandon uranium, because we have a good amount of uranium resources. The issue is that the price of uranium at this time is $24, $25 a pound, my production cost is $17.20. I do profits, right? But what is better? Of course, to exploit the lithium, at $3,200 my cost, the price at $12,000, there is no deposit that has that profit margin, nor the gold. Because you know, the ounce of gold today reached $1,500, but what is the cost of production? We will assume that it is $750, 100% profit, it is a good business. But imagine the profits with the numbers I told you about lithium. So we have to exploit the lithium. And as the engineer has also said, we have to prepare ourselves, it is not that we are ... we are going forward, we will continue exploring, we will transform resources into reserves, we have already started the environmental impact study, we are going to publish shortly our Preliminary Study and, that is, we will continue with courses, as you say, to educate people, as the engineer Malqui said. He was educated, the same must be done, the same must be done with the young, with the students we have here. Later, in 5 years we will have to retire because it is normal, but there is a new generation coming, and it is for them. And it is in the Puno region, what they have to look for is work for the region. I'm not going to be ... I'm not going to be ... and the example is Anglo American. Why has Anglo American recently had problems with Quellaveco? Do you know why people are on strike (against the Quellaveco project) in Moquegua? Because they started to give work to people on the other side, and not to Moqueguans. Am I being clear? So, we must not make the same mistakes, we must give preference to people in the region, but the people of the region have to prepare for that. You have to know, you have to study, you have to investigate, and it is your obligation that people do more research on this.
Eng. Rolo Zapana Yanarico (Head of Metallurgical Research Macusani Yellowcake). (...) that these rocks, which are volcanic tuffs, do not contain uranium. 10 ppm. You take a sample, send it to analyze, 10 ppm in uranium. That is, lithium is totally separated from uranium. Another thing, to the first question about the process. Roasting is an ion exchange process, what does it mean? That the additive that we are adding is brought to its melting point, and I exchange lithium for the additive. In the case of sulfate, convert it to lithium sulfate, here in the rock is like lithium silicate. And lithium sulfate, by leaching it with water, is completely soluble. So it does not mean that we produce gases ... “ozone, which will cause exothermic reactions and etc.”. The reaction itself is of ion exchange, cation for cation, either sodium or calcium for lithium. That would be to clarify, thanks.