US$2 Billion Investment Needed for Lithium Production
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US$2 Billion Investment Needed for Lithium Production

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Karin Dilge By Karin Dilge | Journalist and Industry Analyst - Thu, 02/17/2022 - 13:29

Forming a new state company toward the exploitation of lithium would require an investment of at least US$2 billion, say industry experts. What is more, it could take this company 15 years to start producing the mineral, as experts question the current commercial viability of lithium production under Mexico’s particular circumstances.

President López Obrador announced the creation of a new state company designed to exploit lithium deposits in Mexico, particularly in the state of Sonora. In an interview, Armando Alatorre, President, CIMMGM, explained that for exploration processes alone the company would need US$150 million. The remaining US$1.85 billion would be used to purchase specialized equipment and to construct the mine. This includes electrification, roads for trailers and vehicles, building of processing plants and purchasing of chemical reagents.

“Knowing where exactly the resources are can take between 10 to 15 years, which means we will not see production by the end of the present administration,” said Alatorre. Moreover, Mexico’s potential lithium reserves are in clay sediments: These types of deposits have not yet been commercially exploited anywhere in the world because extraction methods are still being studied, added Alatorre.

In an interview with MBN, Efraín Alva Niño, Director of the Extractive Industries Unit, Ministry of Economy said lithium can be found in three different types of deposits: brines, pegmatites and in certain sedimentary rocks, which in Mexico’s case are mostly hectorite clays. “Brine deposits are quite rare in Mexico but very common in South America. They represent a category of their own regarding extraction because much of the work is done by mother nature, so the investment needed is very low."

“To extract lithium from hectorite clay, a large number of additional steps need to be added to the extracting process. This means more money and energy,” added Alva, stressing that it might “not be economically viable to extract many of Mexico’s lithium reserves at this time” as more direct exploration and better technology may be required.

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