Soaring lithium prices: Europe to open its own mines?
Lithium, cobalt, and nickel, the metals essential to the manufacture of the batteries for electric cars, are so sought after that Europe is preparing to open mines and refineries to reduce its dependence on imports.
After all, Europe is far too dependent on external powers, particularly China, for its energy transition. With soaring prices – in China, which acts as a global barometer, the cost of lithium rose by 400% last year – extreme measures will be needed.
The subject will be on the table of the European Industry Ministers on 31 January and 1 February in Lens during the Competitiveness, Industry, and Internal Market Council. On Thursday, the item was also on the agenda of the Bercy conference with ministers and officials from the European Commission and the EU Parliament.
In that order, Australia, Chile, and China are the world’s largest producers of the ‘white gold’ of the energy transition, transforming it into lithium carbonate or hydroxide. On the other hand, Europe is not on the lithium map, either for mining or for processing.
And while at least 38 battery factory projects have been announced in Europa, the issue of metal supply is far from being resolved. A French report submitted to the government this week estimates that Europe will not be more than 30% self-sufficient in 2030 in lithium, nickel, and cobalt, used to store and transport electricity.
Europe has lithium deposits in Serbia, Portugal, Germany, and the Czech Republic. But lithium is also found in France in mineral form in the Massif Central and Armorican, and in a geothermal form in Alsace, according to the French Geological and Mining Research Bureau (BRGM).
But questions about the environmental impact do not simplify operating such sites. In December, the Anglo-Australian mining giant Rio Tinto, which has financed exploration studies at Jadar in Serbia since 2004, faced protests from opponents demanding the publication of environmental impact reports.
Pumping of lithium-laden brine and evaporation to isolate the crystals, a production method widely used in Latin America, is, for example, criticized by NGOs for the drying up of water resources that it causes in the environment.
But there is an urgent need for lithium, cobalt, nickel, or even iridium. Lithium, for example, an essential component to produce electric batteries for cars, has been included in the EU’s list of critical metals. And according to the Internation Energy Agency (IEA), global demand is expected to increase 40-fold by 2040, writes AFP.
By 2030, Europe’s lithium needs alone – for batteries – will exceed 500 000 tons per year, which is more than current world production, which amounted to some 475 000 tons in 2021.
French call for projects
To remedy this situation, the French government, for example, is dangling a billion-euro envelope, half of its public funds. It has just launched a call for projects from industrialists with initiatives to extract or refine lithium, cobalt, nickel, or even iridium – provided they have the environmental green light.
In Argentina, in the ‘ABC’ triangle of lithium (Argentina, Bolivia, Chile), the world’s second-largest source of white gold, the French mining group Eramet has announced the opening in 2024 of a plant with the Chinese Tsingshan. It should produce 15% of Europe’s lithium needs, according to its CEO Christel Bories.
Resources in Europe
According to the USGS, the world’s exploitable reserves were estimated in 2021 at 21 million tons, almost half of which were in Chile (9,2 Mt). The resources, identified deposits without considering their exploitation conditions, are estimated at 86 million tons in total.
But there are also resources in Europe. In the old continent, they are estimated at 2,7 Mt in Germany, 1,3 Mt in the Czech Republic, 1,2 Mt in Serbia, 300 000 tons in Spain, and 270 000 tons in Portugal. No figures are available for France, which has rock lithium in the Armorican Massif, the Massif Central, and geothermal lithium in Alsace.
And precisely because the EU produces hardly any lithium, and China and the US are trying to control the resources, Europe wants to develop its own extraction and processing, precisely to achieve ‘strategic autonomy’ and to meet Green Deal standards to combat global warming.
The French Eramet, for example, has also managed to extract lithium from geothermal brine in Alsace. This is a first that opens industrial prospects in the Rhine Valley.
In Germany, an Australian mining group is promoting its ‘zero carbon footprint’ lithium marketed under the Vulcan brand, for which a partnership has been signed with Renault and Stellantis. Germany will also host a plant built by the Canadian group Rock Tech Lithium on the refining site in 2024. AMG Lithium GmbH, a subsidiary of Dutch Advanced Metallurgical Group (AMG), has also planned to build a lithium plant in Germany.
In Portugal, the leading European country with 900 tons of lithium (but not of battery quality), the authorities are awaiting the verdict of the environmental authority on a refining project led by the Portuguese oil company Galp Energie and the Swedish battery manufacturer NorthVolt.