Mexico began nationalizing lithium to prevent “multinational companies” from seizing it

Critical minerals war is raging because it is essential to the environmental transition and high technology. In the last episode so far, Mexico announced yesterday that it wants to prevent all new private companies from exploiting its lithium mines, one of the resources. “nationalized” found collectively in this region of Central America and which is now an integral part of “legacy” from the state. This is the meaning of the mining law reform passed by the deputies of the majority of the President of the Left, Andres Manuel Lopez Obrador, on Monday, April 18, 2022.

I just signed a mining law reform bill to keep lithium in the nation’s hands […] Lithium, which multinational corporations and governments of foreign countries covet, they will not have “, Said the president before the vote in Parliament.

Mexico will have large reserves in the state of Sonora (north), the specialist website Mining Technology reported in 2019. The projects are currently in the exploratory stage. Previous governments granted eight concessions, and they will remain in effect.

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The law was approved by 298 votes out of a total of 500 deputies, and the law still has to be voted on in the Senate, where the ruling Morena party also has a majority. The law was referred the previous day to the parliament, in a day of discussion, after it refused on Sunday to amend the constitution with the aim of strengthening the state’s role in the electricity market.

Global demand for lithium is high

Lithium has become an important metal whose demand and prices are already rising. In the 11 months, from February 26, 2021 to February 3, 2022, the average global price of lithium increased by 303.3%, from $9,100 per ton to $36,700, according to the index. Metallurgical Intelligence Standard. At the beginning of March, it rose again to $60,773.

By 2030, demand It will nearly double at 4 due to production needs for batteries for electric vehicles, Philip Farren noted during Wednesday’s Senate hearing. Finally, according to experts from Eurométaux, the European Union that currently has 61 companies in this sector, the needs for lithium (for batteries that power electric cars) should increase by 488% by 2050.

A vital resource for the automotive industry

The main port for lithium is already more than 70% of lithium-ion batteries, and to a lesser extent from ceramics, glass and grease. According to the latest USGS report from the European administration, global mining reached 82,000 tons in 2020, concentrated between Australia (40,000 tons), Chile (18,000 tons) and China (14,000 tons).

As for reserves, 21 million tons have been identified worldwide, including 9.2 million tons in Chile, 4.7 million tons in Australia and 1.9 million tons in Argentina.

According to the International Energy Agency, lithium could face a bottleneck in chemical production, with many small producers experiencing financial constraints after years of low prices.

This production of lithium chemicals is highly concentrated in a small number of regions, with China accounting for 60% of world production (more than 80% for lithium hydroxide). As with copper, mines in South America and Australia are exposed to high levels of climatic and water stress.

projects all over the world

In view of the demand, many projects appear all over the world. In Chile, BYD, based in Shenzen, won a call for bids last January for a lithium deposit of 61 million euros. Chilean company Servicios y Operaciones Mineras del Norte SA also received a prize of 60 million. Each of them is rich in 80,000 tons of this strategic mineral.

In Argentina, Eramit is building a factory in the desert of this Andean highland, at an altitude of more than 3800 meters above sea level. Operating in partnership with the world’s largest stainless steel producer, it aims to supply 15% of Europe’s lithium needs.

However, European projects are also trying to see the light of day. But the acceptance of civil society is not always easy. Thus, in Serbia, Belgrade halted the project to operate a lithium mine operated by Rio Tinto under pressure from environmentalists and residents.

A project at Allier?

Opinion polls are also conducted in France. During the pandemic, disruption to supply chains has made the French government aware of the need to reduce the country’s (and Europe’s) dependence on imports of strategic minerals, a market dominated by China in particular. It sets a target of 20% of the European supply of lithium, nickel and cobalt by 2030 to enable the electric car battery and smart magnet sectors for offshore wind turbines to develop production locally. As such, France is considering several lithium mining projects on its territory.

In fact, the government granted Imerys mining group in 2021 a first extension until May 23, 2025 of the exclusive exploration permit for mines of lithium, tin, tantalum, niobium, tungsten and beryllium under “Permis de Beauvoir”, in Allier.

“We have a project in the mining and technical exploration phase, and in 2022 we intend to work on the project to see if it can make economic and environmental sense,” Sebastien Rogge, Group Chief Financial Officer, explained during the presentation of the 2021 results, quoting AFP, specifying: “But there will be no lithium commercial activity in 2022, we will first need to scientifically verify the presence and amount of lithium in kaolin deposits.”

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