Peru holds the world's second-largest confirmed lithium reserves, concentrated in the salt flats of Puno and Arequipa. Until last year they were largely untouched — early-stage concessions held by Canadian, Australian, and Chinese mining companies under a foreign investment framework that offered generous royalties and minimal state involvement. That framework is gone.
The Ley de Soberanía del Litio passed 89 to 41 in Lima. It cancels all existing lithium concessions, vests the mineral rights in the Peruvian state, and creates LitioPerú as the single national operator. Compensation for cancelled concession holders goes through a tribunal whose members are appointed by the Ministry of Energy and Mines. International arbitration lawyers are already booking their flights.
The political logic is the same one that drove Bolivia's 2023 lithium nationalisation and Chile's 2024 decision to require majority state ownership in all new lithium projects. The argument — that countries sitting on minerals critical to the global energy transition should capture more of the value they create — has won democratic majorities across the Andes that no investment treaty was designed to handle.
EV manufacturers are recalculating. LitioPerú has no operational experience, so the extraction timeline is genuinely unclear. Industry analysts are pencilling in a 12 to 18-month production gap that will tighten an already strained global lithium carbonate market. The supply chain stress is real.
"Our grandchildren should benefit from what is under our ground," said President Dina Boluarte. "Not the shareholders of a company registered in Vancouver."