Chile with Kast: signals for copper, lithium, rare earths and Codelco

Chile with Kast enters a new phase: a record mining pipeline, a faster but untested permitting system and renewed geopolitical pressure around copper, lithium and rare earths. This article unpacks…

Geopolitical Mining

Geopolitical Mining · Article

Chile with Kast: signals for copper, lithium, rare earths and Codelco

Authors: Marta Rivera | Eduardo Zamanillo

A decisive right ward turn in Santiago comes just as Chile’s mining investment pipeline reaches a new peak and its permitting reforms enter a critical implementation phase.

Why this election matters for critical minerals

José Antonio Kast’s victory in the 14 December runoff, with about 58% of the vote against Communist Party candidate Jeannette Jara, is being read as Chile’s sharpest political turn to the right since the end of the dictatorship. International coverage emphasises law and order, migration control and spending cuts as the pillars of his mandate. (The Guardian; Reuters)

For critical minerals, the timing is striking. Chile is:

  • the world’s largest copper producer and a core supplier for grid, EV and data centre infrastructure,
  • the second largest lithium producer, central to global battery chains, (Reuters; UNCTAD Investment Policy Hub)
  • entering a decade in which projected mining investment has just been revised up to about US$104.5 billion through 2034, the highest pipeline in more than a decade. (Reuters; Cochilco)

Yet this portfolio sits on top of a system that investors still describe as heavy, slow and politically exposed. The outgoing Boric administration pushed through a major framework to speed up sectoral permits, the Ley Marco de Autorizaciones Sectoriales (Law 21.770), while a contested reform of environmental impact assessment is still moving through Congress. (Biblioteca del Congreso de Chile; DLA Piper)

Kast arrives, therefore, with a strong political mandate, a favourable investment pipeline, and an institutional architecture in transition. How these three layers interact will shape Chile’s role not only as a copper and lithium exporter, but as a potential midstream and technology partner for the US, Europe and Asia.

Critical minerals profile and strategic position

Chile’s material profile is well known but still often reduced to headline labels. For the next decade, three elements are central.

Copper

Chile remains the anchor of global copper supply. The new Cochilco portfolio highlights large brownfield expansions such as Escondida and Collahuasi concentrator projects as key for growth and continuity. Many of these projects are still at prefeasibility stage and lack environmental approval. (Cochilco)

Lithium

Under Boric, Chile articulated a National Lithium Strategy with a greater state role, including a proposed National Lithium Company, majority public participation in strategic salars, and a central role for Codelco and ENAMI in new contracts. That framework is only partially implemented and will now be tested by a government that campaigned on stronger private sector leadership. (IEA; Gob.cl; UNCTAD Investment Policy Hub)

Beyond copper and lithium: emerging rare earths

Chile is also testing its role in the emerging heavy rare earths supply chain. Aclara Resources’ Penco Module, an ionic clay rare earth project in the Biobío region, has become a reference case: after an initial rejection, the company resubmitted a redesigned environmental impact assessment with a smaller footprint, no natural water use and a stronger reforestation and social engagement component. Regional authorities now frame it as part of a broader industrial strengthening strategy, while Aclara positions the project within a mine to magnet concept linked to future separation capacity in the Americas. (Aclara corporate materials; regional press; industry analysis)

How the new Kast administration and the reformed permitting system handle Penco will be watched closely in Brussels and Washington: it is an early test of whether Chile can host environmentally constrained, high value critical minerals projects that speak directly to Western rare earth security concerns, rather than only scaling traditional copper and lithium output.

Investment pipeline

Cochilco’s latest update puts the 2025–2034 mining project portfolio at US$104.549 billion, up 26% on the previous year, with a particularly strong 2030–2034 window. The agency explicitly links materialisation of this pipeline to stable regulatory and environmental conditions. (Cochilco)

External positioning

Geopolitically, Chile sits in a dense web of relationships:

  • China is its largest export market and a dominant buyer of copper concentrates and refined metals.
  • The EU has signed a sustainable raw materials partnership and later an upgraded trade agreement with Chile, seeking secure supply and more value addition. (Epthinktank; EEAS; Stiftung Wissenschaft und Politik – SWP)
  • The US sees Chile as part of a friendly Americas sourcing strategy, but is also deploying tariffs and domestic-content rules that reshape demand and pricing for clean-energy metals. During the Trump administration, the Boric government adopted a generally confrontational stance on trade and climate rhetoric, which added political distance even as commercial ties continued. (Reuters; official statements and coverage of US–Chile positions)

Kast is ideologically aligned with the conservative revival in the US and parts of Latin America, yet inherits a trade and investment map in which Beijing remains central. That tension will run through his mining policy choices.

Institutions, policy and social legitimacy

Permitting and the new LMAS framework

For years, Chile’s main mining risk was not the absence of a legal framework but the density and sequencing of permits. A typical large project faced hundreds of sectoral authorisations across dozens of agencies, with environmental review and judicialisation adding further uncertainty.

Under Boric, Congress approved the Ley Marco de Autorizaciones Sectoriales (LMAS, Law 21.770) at the end of September 2025. The law:

  • standardises a wide universe of sectoral permits,
  • creates a digital one-stop system (Sistema para la Regulación y Autorizaciones – SUPER),
  • and aims to cut permitting times by 30–70%, especially for strategic mining and energy projects. (Diario Oficial; Biblioteca del Congreso de Chile; Ontier)

This framework has now entered into force, but its impact will depend on secondary regulations, agency capacity and political signals.

In parallel, a reform of the Environmental Impact Assessment System (SEIA) is progressing in the Senate, with the stated goal of focusing scrutiny on projects with significant impacts and reducing politicisation at the approval stage. Legal and academic commentary stresses that outcomes will depend on how new rules interact with courts and regional politics, not just on their text. (DLA Piper)

Kast does not inherit a blank slate; he inherits a new architecture not yet tested by a pro-investment administration. For investors, this may matter more than any campaign slogan.

What Kast’s programme actually says – and what it omits

The 2025 official programme that Kast submitted to the electoral authority emphasises:

  • a leaner state and fiscal austerity,
  • simplification of permits and regulation,
  • and a stronger role for private capital in driving growth, including in mining. (Directorio Legislativo; Servicio Electoral de Chile; Kast programme)

From a mining-strategy perspective, two points are notable:

No explicit Codelco chapter.
The document refers to state-owned enterprises in general but does not set out a specific diagnostic or roadmap for Codelco, despite its central role in copper output and public finances. (Servicio Electoral de Chile)

An inherited pledge not to privatise.
In the 2021 campaign cycle, Kast faced criticism over the idea of privatising Codelco and subsequently stated that he would not privatise the company, reframing his position around improving management and productivity in cooperation with workers, while keeping ownership in state hands. (CeCo and campaign coverage)

Taken together, this suggests a likely reformist but not revolutionary stance: keeping Codelco in state hands while pushing for stricter capital discipline, asset rotation and potentially more joint ventures, rather than any outright sale. The absence of detail in the 2025 programme leaves room for interpretation, and for intra coalition bargaining.

Social legitimacy and territorial risk

Kast’s core message to voters was order, security and control of borders, resonating with concerns around crime and irregular migration. (The Guardian; Reuters)

How that law and order lens translates to mining territories remains an open question. Key tension points include:

  • long standing conflicts in parts of the south over land, autonomy and resource projects,
  • community expectations around water, employment and benefit sharing in the Atacama and other mining regions,
  • and an evolving jurisprudence around consultation and indigenous rights.

A more confrontational approach to social protest could unlock some projects in the short term but increase the risk of escalation, reputational damage and litigation. A more pragmatic approach would combine institutional reforms with structured local agreements. For now, the programme is clearer on investment than on territorial governance.

Signals and fault lines to watch

For boards and investors, the key is less whether Kast is promining, he clearly is, and more how his government will navigate institutional constraints and external pressures. Over the next 12–18 months, several signals will be particularly revealing.

Economic and mining team

  • Composition and background of the ministers of Finance, Economy, Mining and Environment.
  • Whether the balance tilts toward technocrats with sector experience, party figures, or ideological allies.

First Codelco moves

  • Any early statement on capitalisation, debt and project portfolio.
  • Clarity (or ambiguity) around partnerships, asset sales or governance changes.

Reframing of the National Lithium Strategy

  • Whether the new government maintains majority-state requirements in strategic salars or opens space for more flexible joint ventures and concessions.
  • Treatment of existing agreements in the Salar de Atacama and future contract models.

Implementation of LMAS and SEIA reform

  • Speed and content of the secondary regulations that operationalise LMAS.
  • Effective rollout of the new one stop digital platform (SUPER) as the mandatory channel for sectoral permits, with real time tracking of delays and bottlenecks.
  • How far the government goes in using positive administrative silence for lower risk authorisations, that is, mechanisms whereby, once a legally defined deadline expires without a formal decision from the State, the permit is deemed granted. In practice, this would shift part of the timing risk from investors to the administration and test the State’s ability to meet its own deadlines.
  • The extent to which key authorisations for flagship mining and energy projects can be processed in parallel rather than strictly sequentially.

Geopolitical positioning

  • Early foreign trips and bilateral announcements: Washington, Brussels, Beijing or regional capitals.
  • Whether Chile leverages its new mining portfolio to negotiate midstream investments (refining, cathode materials, advanced processing) or focuses on accelerating upstream extraction.

Territorial governance signals

  • The government’s initial handling of conflicts in key corridors (ports, roads, energy lines) and around strategic projects.
  • Any new mechanisms for community negotiation, benefit-sharing or indigenous participation, or their absence.

These signals will help determine whether Kast’s Chile evolves into a faster yet predictable jurisdiction, or whether accelerated permitting comes at the cost of higher social and legal volatility.

Sources (selection)

  • Boric, G. (2023–2025). National Lithium Strategy – government announcements and policy summaries. Government of Chile; UNCTAD Investment Policy Monitor; IEA Policies database.
  • Cochilco (2025). Cartera de Proyectos de Inversión Minera 2025–2034. State Copper Commission release and portfolio summary.
  • Government of Chile / Diario Oficial (2025). Ley 21.770 – Ley Marco de Autorizaciones Sectoriales. Legal text and subsequent legal analyses.
  • Kast, J. A. (2025). Bases y Lineamientos Programáticos. Presidential campaign programme filed with Servel.
  • Media and think-tank coverage of the election and Chile’s raw materials partnerships: The Guardian, Reuters, Financial Times, Wall Street Journal, EEAS, SWP Berlin, EU Commission publications on the EU–Chile raw materials partnership.
  • Aclara Resources and regional authorities (2023–2025). Corporate reports, environmental filings and regional development plans referring to the Penco Module rare earth project.