Europe, “Lithium and rare earths will soon be more important than oil and gas”

The Commission chief pronounced these words as Europe was reeling from an energy crisis accelerated by Russia’ war in Ukraine and which led to the bloc pledging to wean itself off fossil fuels — most of which it has traditionally supplied from Russia — and accelerate its transition towards “homegrown” renewables and other green tech.

These, however, rely on so-called rare earths which are needed to produce everything from the latest generation batteries to the materials needed to manufacture photovoltaic panels.

“The urgency now is securing lithium supplies, it’s really really urgent,” Dr Evi Petavratzi, a senior mineral commodity geologist at the British Geological Survey told Euronews.

The United States Geological Survey estimates that Europe is home to 7% of global lithium deposits, enough to cover 80% of European battery needs.

Why are new mines so hard to open?

New mines currently take decades to get approved, due to fierce opposition by local people and politicians who are concerned about environmental and social consequences.

An example of this is the Norra Kärr rare earth element project in southern Sweden. Despite this deposit being found in 2009 and a 25-year mining licence being granted in 2013, no metals have been extracted.

The licence granting led to large protests over environmental concerns and the extraction licence was overturned in 2016 and a mine leasing application was rejected in 2021.

Speaking about the environmental impact of hard-rock mining, Dr Simon Jowitt, an economic geologist and associate professor at UNLV Department of Geoscience said: “There’s always a certain potential impact on the environment, on ground and service water.”

“Every mine is a little different in terms of that potential, but there’s always some. There’s also the risk posed by dust from mines.”

Most lithium is extracted by one of two methods: solar evaporation and hard-rock mining.

The biggest concerns with this form of extracting lithium are its high water usage, possible depletion of groundwater levels, and the waste salt which is left behind. Approximately 2.2 million litres of water is needed to produce one tonne of lithium using this method.

The other most common way of extracting this precious metal is through more traditional hard-rock mining, typically using opencast pits.

Not only are such pits an eyesore, but dust from such mines can also spread to surrounding areas sparking health and environmental concerns. Furthermore, the processing of the mined material can also use significant amounts of water.

However, it is important to put the risks involved in precious metal mining in the context of the benefit they bring from reducing fossil fuel extraction.

Higher prices enabling more complicated extractions

Increased demand for batteries — it is set to explode 14-fold between 2020 to 2030 — has pushed up the demand and price of lithium from about $20,000 per tonne five years ago to $80,000 per tonne last November and driven innovation into new, more expensive, mining methods that mitigate possible impacts on the environment.

An example of this is the proposed San José de Valdeflórez lithium mine in Spain’s Western province of Extremadura.

Originally proposed as an open-pit mine less than a kilometre away from the UNESCO mediaeval city of Cáceres and a natural reserve, the project faced fierce opposition from all quarters.

However, Extremadura New Energies (ENE), the Spanish subsidiary of Infinity Lithium, is now planning on building the mine completely underground with the entrance of the mine being located 2 km away from the city.

The material will also be crushed inside the enclosed mine, cutting the risk of dust pollution.

It has also unveiled plans to use patented technology which means the mine will not have to use sulfuric acid for lithium extraction, resulting in a zero-flow discharge mine. This dramatically reduces the risk of contaminating surrounding land water sources.

Additionally, the vehicles and mining operations will be powered by renewable energy, including from a new green hydrogen plant.

However, these mitigation methods were only introduced following objections by local people and authorities – highlighting the importance of local engagement in improving lithium mining.

Furthermore, although the deliberations and debates over the San José de Valdeflórez project resulted in a much-improved end project, it has been a long journey since it was first proposed in 2015.

Despite this, the project’s environmental impact has never been approved or evaluated. The company is currently seeking approval for an exploration permit and hopes to submit the project for environmental evaluation by April this year.

A local protest group, Salvemos la Montaña (Let’s Save the Mountain), has also gained significant support in its campaign against the project.

EU mining ambitions

The Commission wants Europe to build a more resilient supply chain to reduce its reliance on strategic competitors for imports and processing of rare metals.

In a document published last year, The Commission stated it could introduce targets into legislation, for example, that at least 30% of the EU’s demand for refined lithium should originate from the EU by 2030. Another goal is to ensure that the time from the start of exploration work to a mine or a refining facility opening is reduced to a matter of years, not decades.

To do that, it plans “to facilitate the roll-out of targeted raw materials projects in the EU” and for the Commission to be empowered to “list Strategic Projects – which would be labelled as of European interest – based on proposals from member states.”

Ramón Jiménez, CEO of ENE told Euronews he certainly believes that “it is possible to make this process faster without reducing environmental or social impact reductions”.

He said that his San José de Valdeflórez project had enjoyed strong support from the central Spanish government. However, convincing central governments may be the easy part, convincing local residents will be key if the EU really wants to boost its mining output, Euronews writes.

Europe, Can mining ever be green?

As France prepares to dig for lithium in its own backyard, part of the EU’s broader push to create strategic reserves of key raw materials needed for the green transition, activists worry about the environmental impact of mining

Lithium, Gallium, Magnesium, Indium, Niobium. Although these rare metals and minerals appear to belong to the same family, not all were created equal, at least in the eyes of industry.

The European Commission has listed 30 of them it deems strategic for the future of its ambitious green and digital transitions, but for whose supply Europe has become reliant on foreign countries over the years.

Called “critical raw materials” (CRMs), they fall under the European Union’s strategic autonomy agenda. The Covid pandemic and the war in Ukraine served to highlight the EU’s dependencies on other nations for natural resources and reminded the bloc which states were in its corner, and which were not.

After concluding that China plays an outsized role in supplying the Europeans with these materials essential to electric car batteries, windmills and solar panels, Commission President Ursula von der Leyen announced a new strategy in her State of the Union address, in September 2022: the EU will seek to diversify its trading partners through new agreements. It was also announced that, in early 2023, the Commission will present a regulation on CRMs to create strategic reserves of those materials on European soil.

Geologists have located critical raw materials across the continent. Finland, Sweden, Spain and Portugal, where deposits have been spotted, are eager to dig into the earth. Will the Europeans go back to the mines? Some countries, such as those in Scandinavia, have a long and ongoing tradition of mining, while others closed their last coal mines decades ago.

In any case, the issue worries environmental activists. The word “eco-mining” is on everyone’s lips in Brussels as well as in the Member States, and the concept should ostensibly help overcome obstacles to opening new mines.

In its consultation last October and November, the European Commission identified a lack of investment to create an EU supply and noted that permit procedures were long and complex. Opening a mine can take up to 15 years, between the exploration process to the extraction itself. Moreover, these projects are highly scrutinised, and the legislation in individual Member States remains demanding when it comes to exploiting their natural resources.

The consultation also pointed out the environmental risk. “We have to define our standards regarding responsible mining,” MEP Hildegard Bentele, the EPP rapporteur for the resolution adopted on CRMs by the European deputies in 2021, tells The Parliament. “Because a mine is always an intervention into nature. We should not be blurry about it.” Rather than “green” or “sustainable”, Bentele hopes for “responsible” mines: the impact on the environment will never be zero, but it is necessary to do everything in our power to minimise it.

The idea that a mine can be “responsible” is put forward by the French authorities and the companies which have recently announced lithium projects in several parts of the country. France, where mines are still taboo, has high ambitions for the production of this new “white gold” necessary for the batteries of future electric cars.

A boom in demand is expected after the ban on fossil fuel cars comes into force in 2035. In the Massif Central, in the centre of France, the French company Imerys has announced a vein capable of producing 34,000 tonnes of lithium hydroxide per year, which translates into 700,000 batteries for future electric cars. It plans to start extracting in 2028.

In the Rhine basin, between France and Germany, several projects aim to extract lithium using geothermal technologies: hot salty water is pumped to the surface, from which operators extract the precious metal before reinjecting the water into the earth. The Australian company Vulcan Energy hopes to produce 50,000 tonnes of lithium hydroxide annually starting in 2027. In the same area, some French companies have also successfully passed their first tests of lithium extraction from geothermal brines.

The zone could supply up to 30 per cent of Europe’s lithium needs. Not bad, considering Thierry Breton, the EU’s Commissioner for the Internal Market, has set the ambitious target of being “almost self-sufficient in lithium for our batteries by 2025”. But what is going to be the environmental impact of those mines?

Thierry Breton, the EU’s Commissioner for the Internal Market, has set the ambitious target of being “almost self-sufficient in lithium for our batteries by 2025”

In the Massif Central, even if the mine is underground, the industrial operator will still have to pump water to be able to work. And if it uses hydro-metallurgical separation techniques to extract lithium, large quantities of water will be required. The enterprise promises to recycle water, but with scant details on how often and how much.

At the Franco-German border, geothermal technologies also raise eyebrows among the locals. People are afraid of seismic tremors caused by the stress generated underground. Others wonder whether they may be affected by the high level of radioactivity concentrated a few kilometres away underneath their feet.

Even employing so-called “clean” technologies, the new mines don’t convince everyone. Judith Pigneur, an engineer from the French association négaWatt, has observed these new technologies carefully and as well as an outsider can, given that each company is still relatively hush-hush about its extraction process.

“In absolute terms, the environmental impact of CRMs’ exploitation will only increase because deposits will become less and less good and their contents will decrease [in number],” she explains. As a result, companies will have to dig deeper or be more aggressive in the extraction process.

At the European Parliament, the Greens are wrestling with the dilemma of how to ensure the green transition, which requires critical raw materials, while protecting the planet’s remaining resources. There must be some limits to mining in Europe, explains German MEP Henrike Hahn, shadow rapporteur for the European Parliament resolution in 2021: “Obviously, a protected area in Europe, like Natura 2000 [a network of protected areas], are off-limits for mining industries.”

And the recycling of CRMs must be developed and promoted by future EU regulation, with the objective of creating a market of secondary raw materials.

Of the many CRMs, lithium holds a special place. The projected need for batteries will be so huge that many people are uneasy about our ability to maintain stocks. Even those advocating for a reduced consumption of CRMs across the board agree on the importance of lithium. For them, the only hope is to be able to reduce demand in small, incremental ways, with the understanding that it will, in any case, remain high. “Are we going to use lithium for SUVs or for small cars?” wonders Pigneur, the engineer.

Creating reserves of critical raw materials with new mines in Europe will not be enough to meet tomorrow’s needs, no matter the geopolitical and economic urgency, and even with new extra-European trading partners. The CRMs will also have to give way to the 3Rs: reduce, reuse, recycle, Parliament Magazine writes.

The raw truth of Europe’s raw materials

As the world’s eyes were fixed on United Nations Climate Change Conference COP27 in Egypt, a more low-key bureaucratic gathering was taking place in Brussels, working on growing the industrial supply chains needed to wean the Continent off the most carbon-intensive fuels for both environmental and national security reasons.

Indeed, European Raw Materials Week has now been imbued with an added sense of purpose and urgency, as Russia’s invasion of Ukraine, and some European Union members’ subsequently unavoidable turn toward coal to get through the winter, has exposed Europe to the harsh realities of energy security.

Being dependent on unreliable and hostile actors elevates the strategic imperative of avoiding new dependencies for the critical materials needed to power the green transition with solar panels, advanced batteries and wind turbines — an opportunity and challenge that arguably constitutes a historic inflection point currently being shaped by several converging trends and events.

For one, due to recent landmark legislation across the Atlantic, the United States will now be devoting hundreds of billions of dollars to sustainable energy initiatives, technologies and supply chains. However, there’s understandable consternation that purchasing tax credits for electric vehicles (EVs) through the new Inflation Reduction Act (IRA) will advantage countries that share a free trade agreement with the United States — excluding those in the EU.

This is unnecessarily restrictive, and the U.S. should include preference for EU and NATO members — however, it doesn’t mean Europeans shouldn’t play a significant role, and reap significant benefits, from partnering with North America to diversify its supply chains for raw materials.

The EU currently spends tens of billions of euros subsidizing the purchase of EVs, most of which are heavily reliant on sources for mining and processing that are dominated by China. Getting serious about “Made In Europe” means getting serious about these supply chains as well. Europe has significant mineral processing capacity, and this can be expanded to loosen China’s grip on — and possible weaponization of — this crucial phase of the EV battery supply chain.

For example, the EU already ranks second in global processing capacity for nickel, cobalt and manganese, according to Benchmark Mineral Intelligence. Meanwhile, with limited mining and processing available domestically, many U.S. automakers are now scrambling for alternate sources for such raw materials, so they can be eligible for the IRA’s tax credit. However, minerals extracted from IRA-compliant countries (North America or U.S. Free Trade Agreement partners) could be processed in ever-growing quantities in Europe, and the resulting EV batteries would still qualify for the tax credit within the U.S.

Additionally, information technology such as blockchain is becoming increasingly available, allowing governments, businesses and consumers to track where materials and components come from — as well as how they’re extracted and processed. Thus, democratic nations could agree to condition market access on shared human rights, labor and environmental requirements, in effect creating a “race to the top,” turning high standards into competitive advantage.

Collectively, the EU and North America make up close to 45 percent of global GDP, which provides enormous leverage. Other nations must either comply with these standards — thus, raising their costs and limiting their price advantages — or be excluded. Given today’s supply chain imbalances, the early stage of that transition won’t be easy. But if the world’s technologically advanced democracies have the will, and stick together through the preliminary turbulence, the means do exist.

European Commission President Ursula von der Leyen noted as much in her State of the Union address earlier this year, observing that with “like-minded partners,” Europe can ensure labor and environmental standards outside its borders as well. We have models of collaboration to build upon for this — such as the former Trilateral discussions (including the EU, U.S., Japan — and now Canada and Australia as well), which address what “responsible” mining and permitting really look like.

Finally, the fallout from Russia’s aggression in Ukraine has also laid bare the risks of jettisoning incumbent sources of energy too early in the transition to a carbon-neutral economy. Even the most climate-friendly power generation systems will require tremendous amounts of energy — principally electricity. And in this capacity, the U.S., United Kingdom, Canada and Norway have vast natural resources to help end the EU’s dependence on Russia, even as we recognize this isn’t a sustainable solution.

These priorities are all consistent with recent European policy initiatives, from REPowerEU — a plan to rapidly reduce dependence on Russian fossil fuels — to the Critical Raw Materials Act. They require widening the aperture of our thinking and collaborating on a comprehensive approach to deliver on the EU’s Green Deal and strategic autonomy

President von der Leyen led her address by calling Russia’s aggression “a war on our energy,” as part of a broader assault on Europe’s economy, values and future. And getting our energy response right will require a shared transatlantic approach to critical raw materials, which addresses today’s requirements as part of — and not in conflict with — a prosperous, carbon-neutral future, Politico writes.

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%.

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.