Europe’s Critical Raw Materials Act (CRMA) has elevated Spain as a critical test case for whether EU policy can deliver operating mines and chemical processing before 2030. Spain’s strengths lie in geological diversity, proximity to industrial clusters, and large-scale resources—but permitting and social opposition present significant hurdles.
The San José lithium project in Extremadura, advanced by Infinity Lithium, exemplifies these dynamics. Hosting over 111 million tonnes of measured and indicated resources at 0.61% Li₂O, the project aims to produce 15,000 tonnes per year of battery-grade lithium hydroxide via an integrated underground mine and refinery. Total CAPEX exceeds €800 million, with production targeted for 2028–2029.
Strategically, San José could supply Spain’s emerging battery ecosystem, including cathode and cell manufacturing hubs in Valencia and Catalonia. Underground mining reduces the surface footprint and mitigates social opposition compared to open-pit alternatives. Yet local opposition and judicial appeals have already delayed permitting by several years, highlighting how EU strategic designation does not automatically override municipal authority.
Spain is also reviving tungsten production, particularly in Galicia and Castilla y León. Europe imports over 75% of its tungsten, with China dominating supply. Domestic output of 3,500–4,000 tonnes of WO₃ equivalent per year would reduce strategic dependency. Typical underground tungsten projects require €120–180 million in CAPEX, operating at competitive cash costs, especially when integrated with European tool-steel and carbide manufacturers.
Finland represents a different model, emphasizing integrated upstream and downstream operations. Keliber, majority-owned by Sibanye-Stillwater, is developing Finland’s first commercial lithium operation, connecting spodumene mining, concentrators, and a lithium hydroxide refinery in Kokkola.
Total CAPEX is €600–700 million, with planned output of 15,000 tonnes per year of battery-grade lithium hydroxide, supporting 300,000–350,000 electric vehicles annually. First production is expected by 2026–2027, making Keliber one of the few European projects likely to deliver material supply before 2030.
Finland’s advantages extend beyond geology: institutional stability, experienced permitting authorities, high public acceptance, and low-carbon electricity at €50–70 per MWh. The country also hosts Europe’s only cobalt refinery, with expanding nickel sulfate and precursor capacity, creating downstream demand for lithium feedstock.
Europe’s Lithium Supply Gap
Despite these projects, Europe faces a structural supply gap. By 2030, EU lithium demand is projected at 700,000–900,000 tonnes LCE per year, driven by EVs and grid storage. Even if all advanced projects proceed as planned, domestic supply will likely cover only 120,000–150,000 tonnes, less than 20% of projected demand. Imports, primarily as refined lithium chemicals, will remain essential.
Processing capacity is the primary bottleneck. A modern lithium hydroxide refinery producing 50,000 tonnes per year requires €800 million–€1 billion in CAPEX and 250–300 GWh of electricity annually. Energy costs, at €70–90 per MWh, place European refiners at a disadvantage versus China or the US, forcing reliance on public-sector risk participation. The European Investment Bank typically covers 20–40% of CAPEX, with national development banks providing complementary support.
Lessons from Spain and Finland
Spain and Finland illustrate Europe’s execution challenge:
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Spain: abundant resources, strong industrial demand, but social and permitting delays impede delivery.
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Finland: effective institutions, downstream integration, and faster permitting, yet scale remains insufficient relative to EU-wide demand.
The reality is clear: geology and strategic intent alone cannot close the lithium gap. Success depends on coordinated execution across mining, processing, energy, and offtake. Without rapid expansion of refining capacity, domestic mining risks becoming symbolic rather than materially impactful.
