STORY INLINE POST
The chemical element lithium was probably used for the first time as a remedy for depression and later for bipolar disorders. From there, it has had numerous uses in thermal shock-resistant glass and ceramics, high-performance lubricants, polymers, as a cleaning agent in air systems, metallic alloys, mainly for airplanes, and, obviously, in batteries. This last market segment was born in the 1990s and has seen a dramatic change in the present century, from being one of the uses of lithium to becoming the main use. In 2020, batteries reached an outstanding 70 percent share of the lithium market. That has happened because li-batteries are smaller, lighter, and have a better charge capacity than other technologies. Today, these batteries range from the tiny, used in cellphones and consuming 2-3 grams of lithium per unit, to tablets (20-30g), laptops (30-40g), hand power tools and cameras (40-60 g), and electric vehicles (EV) that consume up to 60kg per battery.
Because of the concerns over climate change, in the last 10 years or so, the automotive industry gradually has been turning to EVs. All this has happened alongside government policies that are geared toward eliminating internal combustion units; for example, the US has targeted EVs for half its national fleet in 2030 while Norway is targeting 100% in five years. Therefore, lithium demand will grow nearly 1,000 percent in the next two decades. The recently created International Lithium Association (ILA) calls this the Lithium Century.
Nowadays, 63 percent of the lithium supply comes from pegmatite (hard rock) deposits in Australia, Zimbabwe, Brazil, Portugal, and China. The remaining 37 percent is from salar deposits in Chile, Argentina, China, and the US. Please note that China is the only country that produces from both pegmatites and salars. Sedimentary Li-clay deposits are not yet in production; if the pilot-plant tests are correct, in the future (three to five years), one or two operations will likely come on stream. Bolivia has no commercial-grade production, and nobody knows if it ever will.
Now, about Mexico. A misunderstanding of our Li-potential appeared due to an internet publication stating we have the world's largest lithium mine. The problem was that the classification only considered the number of tons as its criteria, disregarding the grade of each deposit. The even larger and better grade Manono (Democratic Republic of Congo) pegmatite was not even included.
Unfortunately, what was read by the public was that Mexico has millions of tons of lithium, almost ready to be sold. But history shows that our only fully explored deposit consists of 243.8Mt of ROCK containing 0.348 percent lithium. That grade ranks 34th among the other 38 on the planet. Considering the proposed annual rate of production, it ranks seventh among 14 deposits. Therefore, it should be understood that the Sonora orebody will be additional to the world's lithium supply but very far from being the expected panacea.
To make things worse, a government minister said that lithium was the world’s "new petroleum" that could provide economic rewards as never seen before. As a result, legislators saw an opportunity to nationalize (as they said) lithium to keep such richness in the country. Accordingly, in the last year, between Sept. 8, 2020, and Oct. 1, 2021, five different legislative proposals, from the same number of legislators, all from the same political party, have been issued on this matter. One of the reasons expressed by one of them was that like oil, lithium must be nationalized. For bad or good, none of the proposed laws have led to results.
However, the very last proposal to change the law (Oct. 1, 2021), from the Presidential Office and with nine sections in the first 21 pages, describes the reasons for proposing changes in three constitutional articles; still, there was not a single mention of lithium. Suddenly, page 23 states that new mining concessions on lithium and other strategic minerals will not be issued because of their importance in the energy transition. But in the world, the energy transition is the change from fossil fuels to clean and renewable sources, such as eolian or solar energies. Therefore, lithium is considered an energy source instead of simply an auxiliary for the storage of energies created by any other sources. Once again, lithium and oil are being considered as equals when that is not the case.
Finally, assuming that the government has the economic resources and takes control of lithium mining, where will its production go? The government appears to be ignoring that, today, China gets nearly 80 percent of the lithium produced to continue running its EV battery plants. Then, the question arises, why not forget about controlling the mining and, instead, consider implementing a value chain where the Mexican lithium goes into Li-batteries made in the country and, if dreaming is permitted, someday have EVs also made here?
For the time being, the latest news is that the presidential proposal is on hold until sometime next April. However, the mining sector has to work with legislators to help them better understand that lithium should be used ALONG with the clean and renewable energy sources that the world requires, as was declared in Glasgow recently.