In October, the government will begin consulting indigenous communities near those areas, while proposals from private companies are due by December 31.

Chile's government has selected six priority areas for new lithium extraction projects that will be led by private companies, the South American country's mining minister said Thursday.

In October, the government will begin consulting indigenous communities near those areas, while proposals from private companies must be submitted by Dec. 31, Mining Minister Aurora Williams added.

Chile is the world's second-largest producer of lithium, a key metal for batteries, and currently production comes from just two companies in the Atacama salt flat.

The government is working to boost production, both through efforts led by state copper giant Codelco and by encouraging private investment.

Chilean authorities have already received around 20 declarations of interest for the six priority areas, which include five salt flats and a lagoon, and were identified as having high potential for lithium extraction.

"We believe there will be effective competition, given that these are the areas of greatest interest," Williams said at a news conference.

To obtain government approval for lithium extraction, private companies must have experience in the lithium value chain, adequate financial resources and own at least 80% of the mining concessions in the proposed project area.

Finance Minister Mario Marcel said the announcement of the six priority areas keeps Chile on track toward its goal of developing three or four new lithium projects during President Gabriel Boric's administration and increasing lithium production by 70% by 2030.

"We are taking all necessary measures to meet these objectives," Marcel said.