Chile Seeks to Speed Up Project Approvals

By Simon West

Is Chile about to usher in a new boom period for breakbulk? Industry leaders from DHL Global Forwarding and Integral Chile eye a surge in opportunities as the country seeks to overhaul its cumbersome project permitting process. From Issue 2, 2024 of Breakbulk Magazine.

(3-minute read)


Chile’s plans to overhaul the sluggish pace at which approvals are granted for investment projects have been welcomed by project forwarders.

The South American country boasts one of the region’s most dynamic project markets, with energy, infrastructure, mining, desalination, and cement production steadfast sources of project work. But slow and cumbersome permitting rules are a constant concern, stifling the timely execution of industrial projects, hurting investor confidence, and curbing opportunities for logistics and shipping.

“The permitting process in Chile has become a nightmare for companies in the mining and energy sectors,” said Alberto Oltra, CEO for South America and country manager for Chile at DHL Global Forwarding.

Draft legislation, put forward in January by President Gabriel Boric, aims to tackle what critics have dubbed “permitology,” and comprises two new bills: A first to simplify and speed up sectoral permits and a second to fast track environmental assessment.

If approved by Congress, the first bill would create a so-called Intelligent Permit System covering hundreds of investment projects across the board, from large-scale copper mines to new warehouses.

The system would include a new public entity charged with ensuring compliance with processing standards and a digital single point of contact, dubbed the SUPER platform, which would allow project owners to track the status of their permit applications.

The bill would reduce permit processing times by about a third, the government said.

The second bill would see an overhaul of Chile’s environmental impact assessment system (SEIA) aimed at reducing approval processing times. The new law would do away with two ministerial committees that currently oversee the appeals process, replacing it with an environmental assessment service (SEA) that would handle all petitions. The SEA would have final say on whether a project is approved or rejected.

The bill also attempts to resolve the socio-environmental conflicts that plague so many industrial projects in Latin America by clarifying the rules governing the relationship between investors and local communities.

Carlos Cruz, a former transport minister and current executive director of Chile’s Infrastructure Policy Council, said the draft bills “clearly” address the challenges that investors currently face. If approved, the role of institutions would be more clearly defined to prevent one entity from “invading” the space of another, Cruz said, while public bodies would be sanctioned if they failed to meet specific deadlines during the permitting process.

Project forwarders speaking to Breakbulk applauded the proposals.

A spokesperson for UTC Overseas, which launched a base in Chile in 2003, said the acceleration of sectoral permits was necessary to “reduce bureaucracy,” while Rodrigo Izquierdo, CEO at Santiago-based Integral Chile, said the overhaul was “deeply needed,” adding that dealing with current red tape to get projects off the ground was “no small feat.”

“As a freight forwarder that manages project cargo, Integral Chile will definitely support this improvement and will be very attentive to it when it comes out,” Izquierdo said.

“From our perspective, when you learn about a coming project – or possible coming project – you start investigating and trying to gather as much information as possible. But then you continue checking again and again about the project’s status, and you see no updates.

"With shorter evaluation times, a more efficient process and a better deal of information, Chile will attract more investment and there will be more projects (being executed).”


A Green Energy Hotspot

Chile has emerged in recent years as one of the world’s green energy hotspots. The government wants 70 percent of the nation’s power to come from renewables by 2030, a target generating plenty of opportunities for breakbulk. Boric, who took office in March 2022, has pledged to toughen regulations governing fossil fuels and mining and install 500 megawatts (MW) of power generated from wind, solar and other clean sources.

The country boasts an abundance of natural resources that include the Atacama Desert, a sunbaked plateau in northern Chile ideal for large-scale photovoltaic (PV) development.

Projects such as the 480-MW CEME1, billed as the largest solar PV park in Latin America, has cemented Chile’s status as a global renewable energy powerhouse. Slated to enter commercial operations in 2025, CEME1 is calling for the installation of 860,000 solar panels across more than 400 acres of Atacama wilderness.

Chile is also looking to become a significant player in green hydrogen production, targeting 25 gigawatts (GW) of capacity by 2030.

Notable projects include French renewable power company Total Eren’s H2 Magallanes Project, a mega-scale green hydrogen plant located on the windy Strait of Magellan. The project calls for the development of 10 GW of onshore wind power capacity to power an 8 GW electrolyzer plant, a desalination plant to make clean water to feed the electrolyzers, and an ammonia plant to turn the hydrogen product into green ammonia.

With such potential for buildout, project forwarders in Chile will be banking on Congress to scrap the administrative barriers that hinder development.

“The elimination of unnecessary processes is always very welcome,” said DHL’s Oltra. “If this is the case, in Chile we will see an increase in economic activity and of course, there will be more opportunities for our Industrial Projects department.”


DHL Global Forwarding’s Industrial Projects division will be exhibiting at Breakbulk Europe 2024, taking place on 21-23 May at Rotterdam Ahoy.

TOP PHOTO: dusk at BHP's Spence copper mine in northern Chile. CREDIT: BHP