Portugal is poised to take the lead on the production and export of lithium – a key component of lithium-ion batteries. These rechargeable power sources are used for a large variety of electronics, from mobile phones and laptops to electric cars. Lithium has been experiencing a global boom due to anticipated growing demand for electric vehicles.
The British mining firm Savannah Resources has reported a 44 per cent increase in the quantitly of lithium compared to what was previously estimated for their site in Mina do Borroso, Portugal. The company expects to open a new mine in 2020 in Tras-o-Montes, Portugal’s poorest region.
A mere 25 kilometres away, Portuguese firm Lusorecursos also seeks to open a mine in Montalegre in 2020. The company’s financial director, Ricardo Pinheiro, has declared this location as Europe’s “most important” lithium deposit. These mining projects have the potential to transform both the local economy – particularly in the poorer regions of the country – and the continent’s positioning in the global lithium market.
While Portugal is already Europe’s largest producer of lithium – a metal nicknamed “white gold” due to its silvery colour and high market value – it accounts for less than 15 per cent of Europe’s total consumption. In fact, nearly all of Portugal’s lithium supply is used for ceramics and glassware, not electronics. The majority of lithium imported into Europe hails from China, Chile, and Australia. It is significantly cheaper to refine and import lithium from these countries than to extract it from Portugal’s granite. However, with the opening of new mines, as well as the expanded production in existing mines, Portugal is looking to reduce Europe’s dependency on imports in two ways: increasing extraction, and making refinement and production processes more economically viable. The country’s shift on lithium production comes at a crucial time of increased demand for the metal due to the growing appetite for electric cars. Portugal has already received upwards of 40 requests for permission to prospect for lithium within its borders within the last two years alone.
Simon Moores, the managing director at Benchmark Mineral Intelligence, a company that collects and analyses data on minerals used in batteries, predicts that within one decade Europe will contribute one-fifth of the global electric vehicle lithium ion battery production –compared to China’s current 54 per cent and the EU’s current reliance on foreign imports.
“I honestly believe that lithium could be the new gold for Portugal”, said European Commission Vice-President Maros Sefcovic, who is responsible for energy policy in the European Union’s executive arm. He expects the market for lithium to be worth 250 billion euros annually by 2025, and has been working for over one year to bring a new generation of “green” reusable and recyclable batteries to the EU. The first step in his plan is to reduce dependence on foreign imports – and that’s where Portugal’s new mines come in.
Portugal sees its potential to expand Europe’s lithium market as just one step towards the diversification of multiple domestic industrial sectors linked to the mineral, including auto production, battery production, and renewable energy. In fact, lithium production is only one part of the country’s drive to expand its vast wealth of renewable resources. Green energy accounted for 103 per cent of electricity produced in Portugal this past March, much of it from hydroelectric and wind power, as the country continues to wean itself off of imported fossil fuels.
Portugal’s growing energy economy is a foundational pillar of its GDP makeover. The country’s unemployment rate has dropped from nearly 9 per cent to 6.8 per cent over the past year. Portugal’s President, Marcelo Rebelo de Sousa, remains cautiously optimistic. In a debate earlier this month, he noted, “I am happy, just as all Portuguese people are, because we all want news to be good, especially as the world has complex economic problems and Europe may also have them”.
“We have to be alert to what comes from outside and poses a new challenge for us”, he added. The country’s blooming market in lithium production is keeping Portugal at the cutting-edge of change in the global energy market.