April Newsletter – 19.04.2021


  • The new U.S. plan to rival China and end cornering of market in rare earth metals
  • Glencore and China Huaneng Group sign MOU on CCUS project
  • Flooded mine in China traps 29 workers
  • Australia’s Orocobre and Galaxy to merge to form world’s fifth-largest lithium company
  • Roadmap for US’ clean transportation future unveiled
  • POSCO to build lithium plant in S. Korea
  • In depth interview: Friedland on the new world order
  • Japan’s new battery industry group to seek increased gov’t support

The new U.S. plan to rival China and end cornering of market in rare earth metals

  • In 2019, China was responsible for 80% of rare earths imports, according to the U.S. Geological Survey, although exports fell last year in part due to Covid-19.
  • Rare earths elements are more abundant than their name suggests but extracting, processing and refining the metals poses a range of technical, political and environmental issues.
  • The Biden administration and Department of Energy have targeted rare earths among domestic supply chain priorities as they outline ambitious climate and technology policy.

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A wheel loader operator fills a truck with ore at the MP Materials rare earth mine in Mountain Pass, California, January 30, 2020.

The United States has made previous attempts to reemerge as a dominant player in a rare earths supply chain that is responsible for some of the most important materials involved in electric vehicle production, battery making, renewable energy systems and technology manufacturing. Under the Biden administration, the effort is receiving renewed focus, with massive investments planned in climate change technology and a hard line being taken on geopolitical rivalries and the national security threat posed by China.

In 2019, China was responsible for 80% of rare earths imports, according to the U.S. Geological Survey, although exports fell last year in part due to Covid-19.

President Biden’s sweeping $2 trillion infrastructure legislation seeks to remake the power and transportation markets in the U.S. and rebuild the country’s semiconductor industry. It follows Biden signing an executive order in February designed to review gaps in the domestic supply chains for rare earths, medical devices, chips and other key resources, and in March the Department of Energy announcing a $30 million initiative that will tap into researching and securing the U.S. domestic supply chain for rare earths and other important minerals in battery-making such as cobalt and lithium.


Glencore and China Huaneng Group sign MOU on CCUS project

China Huaneng Group Clean Energy Research Institute and Carbon Capture Transport and Storage Company of Glencore have signed a Memorandum of Understanding (MOU) for the cooperation on carbon capture utilisation and storage (CCUS) technology,

The MOU was signed at the 6th China International Conference on CO2 Capture Utilization and Storage and the collaboration will commence with the CTSCo Project in Millmerran power station in Australia.

Glencore is one of the world’s largest diversified natural resource companies and China Huaneng is one of the world’s largest energy and technology companies.

Signing the MOU today both companies committed to supporting the deployment of low emissions technologies like CCUS to reduce greenhouse emissions from the use of fossil fuels and other industrial processes.

The CTSCo Project in Queensland, Australia will use China Huaneng’s CO2 capture technology at the Millmerran coal fired power station to capture a stream of CO2 which will then be transported and stored permanently in a non-potable aquifer at a depth of more than 2 kilometres.


Flooded mine in China traps 29 workers

A mine in the northwest Xinjiang region experienced an underground flood on Saturday evening, affecting 29 workers. Eight workers have been rescued and the remaining 21 are still trapped.

The accident occurred at the Fengyuan Coal mine in Hutubi County as upgrades were being conducted. According to the Times, the coal mine’s licence was revoked last year due to safety concerns.

The flood occurred around 6:10 p.m. local time Saturday, according to the Xinhua News Agency, with the cause remaining unclear. Power outages ensued as well as the loss of communication lines.

As of Sunday morning, eight workers had been rescued and are in good health while another 12 were located on a platform 1,200 metres below ground level. It was not until Monday morning that the remaining nine miners were found; eight were located on a second platform and another worker was found in an escape route.

All 21 miners remain trapped by the floodwaters, which are currently being pumped out. The Xinhua News Agency reported on Sunday that Ma Xin, director of Changji’s emergency management bureau, “said that the underground environment is very complex and drainage is the foremost concern at present,” citing the difficulties associated with moving heavy machinery in submerged passages.


Australia’s Orocobre and Galaxy to merge to form world’s fifth-largest lithium company

April 19 (Reuters) – Australian lithium miner Orocobre Ltd ORE.AX said on Monday it would buy rival Galaxy Resources GXY.AX to form the world’s fifth-largest lithium chemicals company valued at A$4 billion ($3.09 billion).

The deal comes at a time of increasing industry consolidation in the wake of soaring prices for the raw material used in electric vehicle (EV) batteries.

“The merged entity’s growth opportunities in both brine and hard rock position it uniquely to take advantage of expected rising EV demand for lithium,” Galaxy Chairman Martin Rowley said.

Orocobre and Galaxy, which operate the Olaroz and Sal de Vida lithium projects in Argentina respectively, are also eyeing a consolidation of their assets in the country.

“The merger consolidates the combined group’s position in Argentina and will give us significant operational, technical and financial flexibility to deliver the full value of our combined portfolio”, Orocobre Chief Executive Martín Pérez de Solay said.

Under the deal, Galaxy shareholders will receive 0.569 Orocobre shares for each Galaxy share held. After the merger, Orocobre shareholders will own 54.2% of the combined company, while Galaxy shareholders will own the remaining.


Roadmap for US’ clean transportation future unveiled

A new report by researchers at the University of California Berkeley lays out what the US needs to do to achieve a clean transportation future.

To understand what actions are crucial to conquer such a goal, the researchers developed the Drive Rapid Innovation in Vehicle Electrification (DRIVE Clean) scenario, in which EVs constitute 100% of new US light-duty vehicle (LDV) sales by 2030 as well as 100% of medium-duty vehicle (MDV) and heavy-duty truck (HDT) sales by 2035. In this hypothetical case, the grid reaches 90% clean electricity by 2035, and substantial EV charging infrastructure is deployed.

One of the main points in the report is that the production of lithium, cobalt, and graphite must expand dramatically to meet the demand enabled by high levels of electric vehicle manufacturing.

In this sense, there are hurdles that the US needs to overcome to guarantee its own supply of battery metals. A big problem is the fact that most battery metals production is currently located outside the country, often in potentially unstable nations or where labor conditions violate human rights. Another issue that may arise in the near future is related to the effect of changing lithium-ion battery design and chemistry on demand for rare earth metals.


POSCO to build lithium plant in S. Korea

SEOUL, April 14 (Yonhap) — POSCO, the world’s fifth-largest steelmaker by output, said Wednesday it will build a plant in South Korea to extract lithium hydroxide, a key material for electric vehicle (EV) batteries.

POSCO said its board of directors approved the plan last week to build a plant in the southern industrial city of Gwangyang by 2023.

The plant, on which construction is set to begin in the first half of the year, will have an annual production capacity of 43,000 tons of lithium hydroxide, which is enough to manufacture about 1 million electric vehicles.

POSCO said it plans to import spodumene from Australia, from which lithium hydroxide will be extracted at the plant.

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POSCO Chairman Choi Jeong-woo inspecting a construction site of a lithium extraction demo plant in Argentina

Separately, POSCO is set to begin building a plant in the coming months near the Salar del Hombre Muerto salt lake in northern Argentina. The plant will have an annual production capacity of 25,000 tons of lithium.

POSCO bought lithium mining rights in Argentina from Australian lithium miner Galaxy Resources for US$280 million in 2018. Currently, the steelmaker has mining rights for an area of 22,800 hectares in the region.


In depth interview: Friedland on the new world order

Robert Friedland, the founder and executive co-chairman of Ivanhoe Mines (TSXL IVN; US-OTC: IVPAF) gave a keynote presentation at this year’s virtual CRU World Copper Conference. Filmed from his home in Singapore on April 13, the billionaire spoke about what the electric future will look like and what needs to happen to the supply chain to get there. He also called copper a “national security issue.” What follows is an edited transcript of his comments:

“We’re here to talk about the revenge of the miners and how important it is that we sustainably mine copper metal for the new world economy. We spent about 100 years where the principal real reason for fighting wars was hydrocarbon. War! Hydrocarbon! And now we see hydrocarbon relatively less important over a period of say a generation; for a generation and a half. And so we now see the balkanization of the world economy, where Greater China has been focused on their energy security, on their own industrial transformation, their own electrification, the improvement of the environment for their own people, top to bottom, eliminating water pollution, air pollution, electric transportation. And then a fear of Europe and the United States. That they also have to secure their entire, top to bottom,  supply chain, and that leaves people out, like the Japanese, or the Koreans, or the Indonesians, or the Brazilians, wondering about their supply chain. And so as each block starts worrying about the national security implications of their supply chain, this balkanization of what was a perfectly integrated world economy the last ten years, is inherently inflationary, and inherently involves the duplication of effort.


Japan’s new battery industry group to seek increased gov’t support

TOKYO (Reuters) – Japan’s newly created Battery Association for Supply Chain (BASC) said on Wednesday it will seek increased government support as it aims to reinforce the industry’s global competitiveness and speed up decarbonisation.

Formed this month, the BASC’s 55 members include Nissan Motor Co Ltd, Sumitomo Metal Mining Co Ltd, Asahi Kasei Corp, Panasonic Corp and Toyotsu Lithium Corp.

“We will come up with policy recommendations that will boost global competitiveness of Japanese battery industry and help the industry’s decarbonisation,” Isao Abe, chairman of the BASC, told a news conference.

Increased support from government is needed as rivals in China, the United States and Europe receive much bigger subsidies and tax advantages, Abe said.

The group plans to submit policy recommendations to the industry ministry by the end of July.



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