French project aims to supply Europe with lithium

French project aims to supply Europe with lithium

A lithium-ion battery photographed at a Volkswagen factory in Germany. The EU aims to increase the number of electric vehicles on its roads in the coming years.

Ronny Hartmann | AFP | Getty Images

Minerals giant headquartered in Paris Imerys plans to develop a lithium extraction project that it is hoped will help meet demand and secure supply for Europe’s emerging electric vehicle market.

In a statement Monday, Imerys said the Emili project would be located at a site in central France, with the company producing 34,000 tons of lithium hydroxide annually from 2028.

According to the company, this production level would be enough to equip “about 700,000 electric vehicles per year”.

In addition to being used in cell phones, computers, tablets and a host of other gadgets synonymous with modern life, lithium — which some have called “white gold” — is crucial to the batteries that power electric vehicles.

The project planned by Imerys is taking shape at a time when major economies such as the EU are striving to increase the number of electric vehicles on their roads.

The EU plans to sell new diesel and petrol cars and vans from 2035. The UK, which left the EU on January 31, 2020, is pursuing similar goals.

With demand for lithium rising, the European Union – of which France is a member – is trying to bolster its own supplies and reduce dependence on other parts of the world.

In a translation of her State of the Union address last month, European Commission President Ursula von der Leyen said that “lithium and rare earths will soon become more important than oil and gas”.

Von der Leyen, who switched between different languages ​​during her speech, not only emphasized security of supply, but also emphasized the importance of processing.

“Today, China controls the global manufacturing industry,” she said. “Nearly 90% … of rare earth[s] and 60% of the lithium is processed in China.”

“So we will identify strategic projects across the supply chain, from extraction to refining, from processing to recycling,” she added. “And we will build strategic reserves where supply is at risk.”

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Back in France, Imerys said it was finalizing what it described as a “technical scoping study” to “explore various operational options and refine geological and industrial aspects related to the lithium extraction and processing method”.

The location selected for the project has been in use since the end of the 19e century, used to produce a type of clay called kaolin for use in the ceramic industry.

Construction investment on the proposed lithium project is estimated at about $1 billion (about $980 million), Imerys added.

“After successful completion, the project would contribute to the French and European Union’s energy transition ambitions,” the company said. “It would also enhance Europe’s industrial sovereignty at a time when car and battery manufacturers rely heavily on imported lithium, which is a key element in the energy transition.”

In recent years, a range of factors have created pressure points when it comes to the supply of the materials critical to EVs, an issue highlighted by the International Energy Agency earlier this year. in its Global EV Outlook.

“The rapid increase in electric vehicle sales during the pandemic has put the resilience of battery supply chains to the test, and the Russian war in Ukraine has compounded the challenge,” noted the IEA report, adding that the prices of materials such as lithium, cobalt and nickel have risen.

“In May 2022, lithium prices were more than seven times higher than at the start of 2021,” it added. “Unprecedented demand for batteries and a lack of structural investment in new supply capacity are key factors.”

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In a recent interview with CNBC, the CEO of Mercedes-Benz outlined the current state of affairs, as he saw it, when it came to the raw materials needed for EVs and their batteries.

“Commodity prices have been quite volatile over the past 12 to 18 months – some have gone up and some have even fallen again,” said Ola Kallenius.

“But it’s true that as we go electric, all-electric and more and more automakers enter the electric space, there’s a need to expand the mining and refining capabilities for lithium, nickel and some of those raw materials needed to produce electric cars.”

“We have everything we need now, but we need to look at the medium to long term and work with the mining industry here to increase capacity.”