Home Argentina market The next frontiers of the lithium boom

The next frontiers of the lithium boom


Lithium is becoming an increasingly important topic in the oil and gas world as companies realize the importance of lithium-ion batteries in the future of global energy. It will be key to the energy transition, not only for use in batteries for electronic devices, but also for electric vehicles (EVs) and for storing renewable energy for regular release. So what are countries around the world doing to fuel lithium production? Automakers around the world are stimulate demand for lithium as they increase their production of electric vehicles, many automakers are planning to roll out several new models of electric vehicles by 2030. Particularly across Europe where several countries have announced bans on the sale of new internal combustion engine cars for the end of the decade, lithium batteries will become a necessity in the future of transportation. In fact, the World Bank estimates that lithium production will have to increase quintupled to meet global needs and climate goals by 2050.

In the United States, several energy companies are racing to find new lithium supplies to boost production over the next decade and beyond. Currently, the only active lithium mine in the United States is the Thacker Pass mine in Nevada, which means that many companies are trying to find other sources across the country.

Currently, most lithium supplies come from South America and Australia, with the largest reserves in Chile. The United States produces approximately 2% of global lithium and hosts 4 percent of the reserves. To find new sources, the United States would likely have to conduct surface mining or brine mining, which environmentalists say could cause environmental damage. Although energy companies argue that the development of the lithium market would eventually support the phasing out of fossil fuels.

Related: Product Tankers Outperform Crude Tankers

Now, a possible location for lithium mining has been discovered on the California-Mexico border in the Salton Sea – a landlocked lake that may soon become known as Lithium Valley. General Motors Co. last week signed an agreement with Controlled Thermal Resources (CTR) to produce lithium at the deserted Salton Sea site. The California Energy Commission has been exploring the area since 2019 and believes it could provide approximately 40% of global lithium demand.

The Salton Sea region has been nearly abandoned due to lake contamination which has driven away tourists and left ghost towns in their wake. These new exploration and production operations could bring jobs back to the region. Responding to environmental concerns, three companies working on the lake are introducing chemical processes that could extract lithium in a more environmentally friendly way.

Currently, there are 11 geothermal power plants near the lake. President and CEO of BHE Renewables, Alicia Knapp, Explain “We’re already pumping 50,000 gallons of brine per minute through all of our 10 geothermal facilities to the surface…and we’re using the steam from that brine to generate clean power. So we’re really halfway there. -way as far as we have the lithium here in our hands.” EnergySource and CTR are also looking for greener ways to access lithium resources.

Argentina is seeing a similar boost in its lithium industry as Australia’s Lithium Energy Limited (LEL) and the Hanaq Group, with Chinese and Argentinian investments, are teaming up to explore the endorheic Olaroz-Cauchari Basin for lithium resources. Argentina is part of ‘lithium triangle’ with Bolivia and Chile. Hanaq already operates the Providencia silver mine in the northern province of Jujuy, and now wants to explore other resources that could fuel the energy future.

Once permits are granted, this could create much-needed jobs in the area. Both groups aim to foster the sustainable development of the basin to hopefully produce large quantities of lithium for battery production in the future.

However, not all countries are willing to share their resources, with Mexican President Andres Manuel Lopez Obrador (AMLO) unwavering in his decision to nationalize Mexico’s energy industry. His political party MORENA recently passed a law nationalizing the country’s lithium reserves, meaning the creation of a state group for their management.

Unlike Argentina’s brine-based reserves, Mexico’s lithium is clay-based, requiring new technologies to extract the lithium at a higher cost. However, without international participation in the extraction of its reserves, mining seems increasingly unlikely. Mexico has the potential to play an important role in the future of battery production, particularly due to its strong manufacturing industry, but by nationalizing its energy sector it will not play a major role in supplying batteries. energy for global transition.

New discoveries in the United States give optimism for lithium production in new parts of the world, while exploration potential in Argentina will likely further expand the reach of the South American lithium triangle. Although lithium production remains relatively low at present, the industry is undergoing substantial investment, which will allow it to grow at a rapid pace over the next decade. Several countries that have the potential to exploit lithium must now decide if they want to be part of this production push.

By Felicity Bradstock for Oilprice.com

More reading on Oilprice.com: