Lithium, cobalt… Why these metals are so strategic for car development

Beware slippery road. To meet the exponential demand for batteries to power electric cars, new mines will have to be opened. But between the time we decide to do it and the extraction phase, it can take many years. The average term is nine years, estimates the Boston Consulting Group.

But China has taken a step forward. While it remains a major polluter and continues to open coal-fired power plants, it also aims to become a leader in energy and environmental transition. “By engaging all of humanity in the search for rare metals, energy and the digital transition are sure to exacerbate dissension and discord. Far from ending the geopolitics of energy, it will, on the contrary, exacerbate it.”wrote in 2018 Guillaume Pitron in The rare metals war, the hidden face of the energy and digital transition (The Links that release).

It’s also a paradigm shift for car manufacturers. “who will suddenly have to manage the issue of mineral resources”, notes Thomas Weber, associate director of the Boston Consulting Group (BCG). In a collective note for the month of June entitled eletric cars speed upBCG identifies two short-term obstacles to the development of this market: nickel and lithium, with supply difficulties for these two metals.

France “does not lack lithium, but active mines”

Lithium demand is expected to increase by 25% by 2030. But logistical difficulties linked to the post-covid economy, as well as rising energy prices, are putting these resources under pressure. “Lithium, whose reserves are abundant, is not lacking. But we don’t have active mines. Between the offer currently available and the needs, the difference could be 5% by 2030”estimates the BCG.

“We have lithium mines in France and we are going to develop them thanks to the new mining code”, promised the President of the Republic Emmanuel Macron on October 17, 2022 at the Paris Motor Show, revealing his plan to relocate the entire electric car industry tomorrow. About forty deposits exist in France, according to the Bureau of Geological and Mining Research (BRGM).

An opportunity that industrial mineral giant Imerys intends to seize. After 18 months of underground research and studies, this French group announced Monday, October 24, the start of mining at a deposit located at the Beauvoir site, in the town of Echassières, on the Allier. He intends to invest one billion euros to operate for at least 25 years what could be “ one of the biggest” lithium extraction projects in Europe according to Imerys, which aims to a production of 34,000 tons of lithium hydroxide per year”. purpose, food “French and European car manufacturers”promises Alessandro Dazza, CEO of Imerys.

Difficult access to cobalt

The matter is much more delicate with cobalt, whose great part of the resources is currently concentrated in a single country: the Democratic Republic of Congo. And 50% of the funding associated with it is of Chinese origin, notes the 2022 edition of the Cyclops report annually devoted to raw materials. The big names in this sector are called Zhejiang Huayou Cobalt, Jinchuan and China Molybdenum. “In addition to access to these raw materials, there are also all ESG (environmental, social and good governance) issues” Thomas Weber also specifies, evoking the theme of the Democratic Republic of Congo.

Everywhere the Chinese advance their pawns. At the end of December 2021, the Chinese authorities announced by decree the creation of the China Rare Earth Group, which aims to become the world leader in rare earths. Earlier this year, the acquisition of Canadian lithium mining company Neo Lithium by Chinese group Zijin Mining Group sparked heated debates in Canada.

For nickel, of which Indonesia is the main producer, followed by the Philippines, Russia and France via New Caledonia, Chinese groups are also attentive to guarantee their supplies and influence the market.

In January 2022, Philippe Varin delivered a report on how to guarantee the supply of mineral raw materials for the industry. He makes proposals, in particular the creation of a public-private investment fund to guarantee access to these resources. Because production in European mines, as well as recycling, will only satisfy 20 to 30% of European demand and not in ten years’ time. Europe would need to open mines on its territory. But resistance in the ground is often very strong, as we saw for lithium at Finistère earlier in the year.

“The path from peak to carbon neutrality is narrower than ever before”notes Philippe Chalmin, who co-leads the Cyclops report.

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