Imerys to open French lithium mine

France’s Imerys announced plans on Monday to become the leading supplier of lithium in Europe through a mining project in central France as a push to make electric vehicles widely available spurs a “white gold” rush for the mineral.

Imerys said results of surveys carried out at its Beauvoir mine in the Allier department in central France allow it to produce 34,000 tonnes of lithium hydroxide for at least 25 years from 2028 to supply around 700,000 electric cars.

The announcement comes as European miners are rushing to launch domestic production of the raw material, a crucial component for electric vehicle production, currently sourced almost entirely from outside the bloc.

Electric cars are a key plank of European Union plans to cut emissions, and the bloc is trying to reduce reliance on battery supplies from Asia through projects with European-based carmakers and battery specialists.

Touring the Paris Motor Show last week, French President Emmanuel Macron told the financial daily Les Echos that his administration wanted to make electric vehicles “accessible to everyone”.

Macron then proceeded to announce a series of measures to enable households to acquire electric vehicles.

With the EU seeking to ban the sale of combustion engine vehicles from 2035, France is trying to gradually phase out fossil-fuel cars.

While the move is seen as an essential step on the road to energy transition, it also poses a serious problem: it will require massive quantities of metals needed to manufacture batteries, especially lithium.

Almost all the critical minerals currently come from outside the continent, with China dominating the global supply chain. The world’s main lithium suppliers also include Australia and Argentina.

Since 2015, production volumes of lithium – also known as “white gold” – have tripled worldwide, reaching 100,000 tonnes per year by 2021, according to the International Energy Agency.

European Commission President Ursula von der Leyen said last month that “lithium and rare earths will soon be more important than oil and gas”, adding that the bloc’s demand for rare earths alone will increase fivefold by 2030.

Various miners are exploring domestic European lithium projects including in Austria, Germany and the Czech Republic.

Imery’s French rival Eramet is exploring a project in the Alsace region.

The French project is estimated to involve construction capex of around 1 billion euros, Imerys said, adding that cash cost of the lithium project is estimated to be around 7-9 euros per kilo.

The Beauvoir site has been producing kaolin for ceramics since the late 19th century.

In Serbia, a domestic mining project has been facing stiff opposition from the local population.

EU wants to mine its way out of reliance on China for raw materials

The EU knows it’s heavily dependent on foreign powers like China for valuable materials needed to power its green transition.

Europe wants to start mining its own backyard in an attempt to end reliance on China for raw materials crucial for green technologies like electric car batteries.

But for the Europeans who live near mineral-rich grounds, opening new mines — with their potential for local environmental damage — is out of the question.

“It’s been my family’s home area since time immemorial,” said Carina Gustafsson, a campaigner who lives near a major reserve of rare earth minerals in southern Sweden that’s a potential mining site. “I really feel like it’s personal — this mining is threatening in so many ways.”

The pushback from campaigners like Gustafsson around the bloc is causing a headache for EU leaders.

Critical raw materials like lithium, cobalt and rare earth elements are found in technologies ranging from electric vehicle batteries to wind turbines and solar panels — tech that lies at the heart of the bloc’s push to go carbon neutral by 2050.

For now, the EU depends in large part on autocratic regimes for its supply of these materials, especially China, which provides nearly 98 percent of the EU’s supply of rare earths.

“Lithium and rare earths will soon be more important than oil and gas,” European Commission President Ursula von der Leyen said last month. “Our demand for rare earths alone will increase fivefold by 2030.”

To avoid the risk of being cut off, Brussels is cooking up new legislation expected in the spring to diversify where it gets these materials from, including by starting new mining projects.

Yet in order to ensure a steady pipeline of such materials and avoid potential blackmail by autocratic providers, the bloc needs to revive certain industrial activities that its environmentally conscious residents would prefer not to have to worry about again.

Chinese monopoly

The EU woke up to its reliance on foreign powers for this green gold dust late in the game, developing its first strategies on raw materials in the late 2000s.

“The overall situation in terms of China has become even worse over time and around 80 percent of all critical raw materials [are] coming from China,” said Frank Umbach, research director at the European Centre for Climate, Energy and Resource Security at King’s College London.

The country entered the raw materials market in the mid-1980s and quickly became a major supplier.

Part of China’s strategy is not only to control raw material mines at home, but also abroad, he said. The Democratic Republic of Congo —  where Chinese companies have already invested billions of euros — supplied about 70 percent of the cobalt in 2021.

Beijing has a “record of blackmailing this dependency,” Umbach said, pointing to a two-month embargo China imposed on rare earth exports to Japan in 2010. Tokyo had captured a Chinese fishing boat in Japan-controlled waters that have long been also claimed by China.

Such incidents risk becoming more frequent, Umbach warned.

The European Commission is acutely aware of the danger. As part of its plan to avoid replacing one dependency with another, the EU executive seeks to establish priority mining projects within the bloc — and ensure they can benefit from streamlined permitting procedures and private investments.

Many countries — including some with ongoing mining projects — support the plan. A Franco-German paper calling for greater financing for raw material production within the bloc last month received support from several countries including Denmark, Ireland, Poland, Greece, Portugal, Finland, Belgium and Romania.

But while the EU executive may have these countries on board, it faces a harder time convincing local residents.

Mining still has a “dirty” image, conceded EU Internal Market Commissioner Thierry Breton in a blog post. Environmentalists warn that the possibility of opening new mines within the block risks harming biodiversity and polluting groundwater. That’s making local residents aware of the environmental cost of the green transition — currently being paid by communities on the other side of the globe.

Fighting talk

The trade-off is being felt acutely in Jönköping county, Sweden, home to the EU’s most notable deposit of heavy rare earth metals, an area of forest and farmland named Norra Kärr.

Campaigners have long fought back against attempts to mine it. The proposed site is located nearby a Natura 2000 area — meaning it’s protected by EU law — and uphill of Lake Vättern, Sweden’s deepest and second-largest lake which provides 250,000 people in Sweden with fresh water.

Most recently, Canadian company Leading Edge Materials presented a plan for an open cast pit. The proposal has sparked intense debate in recent years — but campaigners have so far succeeded in staving off the plans.

“It has been the sustaining life force and still is — not just for humans but for farmlands,” said Gustafsson, the Swedish campaigner. “[The plan] is mental to me. Mentally insane.”

The situation is a microcosm for the puzzle of how to marry the hunt for green transition technologies with protecting valuable water sources, biodiversity and sustainable agricultural livelihoods, said geologist Julie Klinger. “The potential [environmental] fallout from [mining Norra Kärr] is really quite serious,” she added.

The mining project’s future remains in limbo.

The project is far from the only contentious mining plan in the EU. From lithium mines in Western Spain and Central Portugal, to a copper mine in Romania — where opponents have been buying up land within the project development area — campaigners could hamper the EU’s attempt to mine its way out of China’s monopoly.

Another way?

Umbach, the King’s College London researcher, said that where “promising projects” emerge in Europe, they run “immediately also into local environmental protests. So it’s obviously difficult.”

Other aspects of the Commission’s plan might hold more promise, according to Klinger, the geologist. While the EU may need to open new mines, she said, this should be a “distant third [choice] behind reprocessing waste and behind recycling,” adding that Sweden is also reprocessing mining waste to extract rare earth elements.

In addition to strong pockets of local resistance, mines can take a long time to start producing, she pointed out — the EU needs new supplies of critical raw materials yesterday.

NGOs also want to see the EU think more about how to reduce consumption, by promoting public transport over the production of new electric vehicles, for example.

“The EU really focuses on the supply side, but you should really think about the demand side, it’s much more important,” said Benjamin Sprecher, an assistant professor at TU Delft.

He expects the EU to go through “a long period of making many mistakes … The question is whether we can afford that long period”, Politico writes.

Lithium could help end the EU’s oil addiction

Europe’s desire to wean itself off fossil fuels and end its reliance on Russian energy is not only going to involve a sea change in consumer habits, but it is also going to require a lot of lithium.

Given that the Old Continent barely produces any of the metal: is it just swapping one dependency for another?

European leaders have extolled the virtues of the New Green Deal which plans for the 27-country bloc to become the first carbon-neutral continent by 2050. To achieve this, the EU aims to slash greenhouse gas emissions by 55% by 2030 compared to the 1990s level, bring emissions from new cars by 2035 down to zero and boost its share of renewables in the bloc’s energy mix to 40%.

Lithium is increasingly used for batteries in electronics from smartphones to television as well as to store energy produced by solar panels and wind turbines and in electric cars.

According to the World Bank, the production of minerals, such as graphite, lithium and cobalt, would need to increase by nearly 500% by 2050 in order to meet climate goals while EU officials estimate that to achieve climate neutrality by mid-century, the bloc will require 18 times more lithium than it currently uses by 2030 and almost 60 times more by 2050.

‘Strategic autonomy’

Yet, Europe only has one lithium mine, in Portugal, and the very vast majority of its needs is currently met by imports.

About 87% of unrefined lithium the EU sources comes from Australia — the rest from Portugal — while Chile, the US and Russia provide 78%, 8% and 4% respectively.

China is also a particularly big player. Although it has about an estimated 7% of the world’s reserves in lithium, 13% of the lithium extracted in 2019 was in China while over half of the lithium extracted that year was processed in the country.

More than 70% of the lithium-ion batteries that entered the market last year were produced in China.

Brussels is aware of this dependency and added lithium to its list of critical raw materials list in 2020.

A Commission spokesperson acknowledged to Euronews that “the production and refining of lithium are heavily concentrated in a handful of foreign countries, which raises our vulnerability to various supply risks.”

They added that “given the economic and technological relevance of this resource, as well as the external dependencies it generates, it is our responsibility to ensure that the European economy can benefit from a sustainable and resilient supply of lithium.”

“Although the EU will continue to cultivate its international partnerships, significant lithium extraction potential exists within our borders and its exploitation could create thousands of jobs. Developing local lithium mining and processing operations will not only enhance our strategic autonomy and reinforce our economy, but will also allow us to better monitor and contain the environmental impacts of mining industries, which are far more difficult to control beyond the EU’s borders,” they said.

Opposition to mines

There are currently 10 potentially viable lithium projects in the EU: three in Portugal, two in Spain and Germany each, with the remaining three in the Czech Republic, Finland and Austria respectively.

For Rene Kleijn, associate professor at the Institute of Environmental Sciences (CML) at Leiden University, “if all these plants become operational, it would probably be enough for our own supply.”

Problem solved, then? Well, not quite.

Getting all these projects off the ground will not necessarily be easy. A €2.2 billion lithium mine project in Serbia was shelved earlier this year after strong local opposition over environmental concerns. There is also fierce opposition to lithium mining in Portugal.

The mining process for lithium is primarily done in two ways. There is the traditional open-pit approach with the metal extracted from hard rock and the second one involves pumping huge amounts of underground water to the surface to remove lithium from the briny liquid that comes up as the water evaporates.

Both are seen as disruptive to the landscape and local population with a potential risk of air and water pollution. Using water to extract lithium is also controversial as water becomes more scarce in some areas due to climate change. Large parts of Portugal and Spain, for instance, have been suffering through a winter drought resulting in near-depleted reservoirs.

But there is a third, greener, way of mining lithium, called Direct Lithium Extraction and that is being implemented for the potential project in Germany. It relies on geothermal energy to pump the brine to the surface to allow for the extraction of lithium before being pumped back into the underground geothermal reservoir.

From extraction to production

Mining however is just the tip of the iceberg. Once extracted, lithium needs to be refined, batteries made and eventually recycled.

In fact, the latter is really where lithium shines.

“One of the largest sources of pollution in Europe and CO2 emissions is road transport,” Julia Poliscanova, Vehicles & e-mobility lead at Transport & Environment, a clean transport campaign group, told Euronews,

Transport generates about a quarter of the EU’s total emissions with road transport accounting for about 70% of them.

“The best way to decarbonise one of the largest climate problems is electrification, and for that, we need batteries. And for that, we need lithium.

“However, it is indeed important to stress that any mining, any raw material extraction, oil, nickel, lithium, gas comes with an impact. When it comes to lithium, the impact per car is significantly less so. When you have a car, you would burn 17,000 litres of oil over the use of that car,” she said.

“For a battery, an electric vehicle, you need about five or six kilogrammes of lithium that you can then recycle and reuse again and again. You just need to get it into your first batteries and then after some time, it can become a circular loop. So the impact of lithium is significantly less than the impact of oil.”

US and China move faster

But again Europe is running behind on the entire supply chain infrastructure.

The European Battery Directive of 2006 was written before lithium-ion batteries became increasingly prominent due to a more lukewarm approach towards fighting climate change then and thus did not set any targets for the recycling of lithium. Nowadays, almost no lithium is recovered in the EU, whereas recycling efficiencies are estimated at about 95 % for cobalt and nickel, and 80 % for copper.

“We could have anticipated this much earlier. For example, in the US we now have policies that basically come from Cold War times that are now being implemented by President Biden in order to secure supply chains for batteries, and electric vehicles,” Kleijn said.

Washington’s Defence Production Act allows the White House to exert control over domestic industries in times of crisis. It was used by President Trump to limit exports of medical goods at the start of the pandemic and by Biden to accelerate vaccination.

It has now once more been invoked by Biden “to secure American production of critical materials to bolster our clean energy economy by reducing our reliance on China and other countries for the minerals and materials that will power our clean energy future” including lithium, nickel, cobalt, graphite, and manganese.

“This is really like hard core state interference in the markets to make sure that your industries are able to survive and also are not dependent on autocratic states or other states that you might not want to be dependent upon. And this is not the kind of policies that Europe is famous for,” Kleijn argued.

“And I’m not even talking about China. I mean, in China, it’s completely state-operated. Large Chinese state-owned mining companies are involved in mining all of these materials all over the world, whether it’s cobalt in Africa or lithium in Australia. The biggest miner for the biggest Australian mining of lithium, for example, is one-quarter owned by a Chinese state-owned company. So you can see how the Chinese government is also heavily involved in securing the supply chains also overseas,” he added.

2030 and beyond

Investments are being made across Europe in battery production to curb reliance from abroad.

About 24 lithium-ion battery cells giga-factories were expected to open across the EU between 2021 and 2030. Tesla, for instance, opened its gigafactory in Germany last month.

The association of European Automotive and Industrial Battery Manufacturers now forecasts that the EU battery market value will grow from €15 billion in 2019 to an estimated €35 billion in 2030 — with lithium-ion accounting for about half — while the global market value will grow from €90 billion to 150 billion.

Still, even in the best-case scenario, with all potential mines opening by 2025, “I don’t see how Europe will achieve sufficiency in this decade,” Poliscanova flagged.

“But moving after 2030, depending on how smart our policy on recycling is, Europe can become self-sufficient,” she concluded, Euronews reports.

Region: EU to withhold Poland funds over dispute

The European Commission said it would deduct money earmarked for Poland from its budget to collect a €15-million fine. The unprecedented measure follows Warsaw’s refusal to close a coal mine.

The European Commission took the unprecedented decision to withhold millions of euros in budget funds from Poland on Tuesday over unpaid fines related to a long-running coal mine dispute.

The EU funding earmarked for Warsaw that will now be held back amounts to some €15 million ($17 million).

Upon hearing the news, Polish government spokesman Piotr Muller hit back, saying his country would deploy “all possible legal means to appeal against this,” Poland’s PAP news agency reported.

Czech and German complaints

The dispute is over a European Court of Justice (ECJ) case relating to the Turow mine near Poland’s border with the Czech Republic and Germany. Both countries had complained of environmental damage caused by the mine.

In 2020, Prague argued that Warsaw’s expansion of operations there without environmental checks went against EU law, amid fears of polluting drinking water.

These complaints underpinned the ECJ’s interim decision in May 2021 for mining to be stopped until the EU’s highest court issued a final ruling.

Poland refused, and in September 2021, the ECJ imposed daily fines of €500,000 for as long as Warsaw ignored the interim decision.

Deal signed too late to avoid fines incurred, EU says

Last week, Poland reached an agreement with the Czech Republic to end the dispute over the coal mine.

The prime ministers of both countries ended the bitter battle over the Turow mine, but it doesn’t erase the financial penalties previously incurred. While the deal between Warsaw and Prague stops additional court fines from accruing, the outstanding amount still remains, DW writes.