The project for the exploitation of lithium in Mexico makes public and private interests collide
In the heat of the information technology era, demand for lithium is increasing, the key metal in the production of batteries for different devices such as cell phones or electric vehicles, and Mexico is one of the countries with the largest deposits of this resource.
Many foreign companies have already shown interest in its exploitation. However, the Mexican government calmly focuses on the entry of foreign capital in this area. In fact, it contemplates the possibility of nationalizing the production of lithium, also known as ‘white gold.
In 2019, it was revealed that Mexico has 243.8 million tons of this mineral to be extracted in the state of Sonora. Although at the time it was claimed that its deposits have a very low lithium content, companies in other countries have not been discouraged. According to official figures, there are more than 527,000 hectares that could be exploited and there are seven foreign mining companies very interested in obtaining some of the 17 concessions in the process.
“Central resource for the energy transition”
” The pressure that exists on the part of these companies is due to the fact that they want to ensure the provision of lithium because it is a central resource for the energy transition,” says Bruno Fornillo, the doctor in Social Sciences and Geopolitics, in statements to RT. “The important thing here is that in the face of this pressure the authorities and the local population intercede in order to have public control of the resources,” he added.
However, the applications so far are on hold because Mexican President Andrés Manuel López Obrador has said that during his tenure not a single mining concession will be granted. In addition, it does not rule out that Mexico has a more relevant role in the future for the exploitation of lithium.
The president also pointed out that the idea of nationalizing ‘white gold’ is being analyzed, but that great clarity should be given on the matter so as not to instill fear in investors. This initiative was proposed by the Senate at the end of last year and is expected to be debated by legislators in the coming weeks.
“The traditional role of subordinate”
Bruno Fornillo considers that the position of the Mexican government is “viable”, because it is something similar to that established in Bolivia, “where the lithiferous deposits and the growth of the value chain are in the hands of the Bolivian State.” On the other hand, Mexico’s initiative differs from what “happens in Argentina and Chile, where basically what happens is that the raw material is exported and the finished products will be bought, thereby replicating the traditional subordinate role of the region, “he criticized.
Currently, only one of the 36 projects that officially exist in Mexico to produce lithium is from a local company, while the rest are from companies from the US, Canada, Australia and the United Kingdom.
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MORENA proposes to insure Mexico’s lithium and “nationalize” it like oil
Lithium is a very light, soft, silvery-white alkali metal that is used in the manufacture of steel, batteries, lubricants and its derivative, lithium carbonate, in medicine. A few years ago a large lithium mine was discovered in Mexico, which has the potential to be the largest in the entire world. So now its exploitation is already concessioned to a Chinese and a Canadian company.
Semarnat previously proposed that Mexico create a company dedicated to the manufacture of electric vehicles. This is to take advantage of the fact that the country is rich in lithium, the mineral base of the ecological batteries necessary for electric cars.
Armenta argued to EFE that “nationalizing lithium does not mean expropriating, since the rights of companies are overexploitation, not over land.” Therefore, the objective is for Mexico to have absolute control over the mineral that is in the national territory, through a new national company: Litiomex.
“Mexico is no longer a colony nor is it a country of conquest, at least we are not going to allow it in the Senate of the Republic. Lithium belongs to Mexicans and we are going to defend it, that is why this initiative is in favor of Mexico, in favor of the development of our country, ”Alejandro Armenta told EFE.
The initiative was presented this September 22 in the Senate, and in it Senator Armenta proposes to change article 27 of the Constitution to include what he calls “white gold” as a good of the nation.
The document provides for the creation of Litiomex, the national company whose main task will be to “review environmental measures in the extraction of lithium and regulate public and private investment in lithium.”
The mine with lithium reserve potential of 243.8 million tons is located in Sonora, according to Mining Technology.
Senator Armenta said that there are a total of 31 registered projects, either for exploitation or for the search for lithium. Specifically, the Bacadéhuachi, in Sonora, has the intervention of the Canadian Bacanora Minerals and the Chinese company Gangef, where 420 million dollars have been invested and from where it is estimated to obtain about 17 thousand tons per year of lithium carbonate in a first phase.
“In the case of petroleum and solid, liquid or gaseous hydrocarbons in the subsoil and lithium, the property of the Nation is inalienable and imprescriptible and no concessions will be granted. In order to obtain income for the State that contributes to the long-term development of the Nation, it will carry out the exploration and extraction of oil, other hydrocarbons and lithium, through assignments to productive State companies or through contracts with these or with individuals, in the terms of the Regulatory Law. To fulfill the objective of said assignments or contracts, the production companies of the State may hire individuals. In any case, the hydrocarbons in the subsoil and lithium are the property of the Nation and this must be stated in the assignments or contracts ”.
Lithium is used in batteries for electric cars, which can also be used in the aerospace industry, in aluminum, glass and ceramics. It even plays an important role in the pharmaceutical industry where it is used as a catalyst for the production of drugs such as pain relievers, contraceptives, steroids and tranquilizers.
At the end of last year, the president of Mexico, Andrés Manuel López Obrador, ruled out that the fields in Mexico were only exploited with public investment. “This would have to be done with the participation of private initiative because it requires a budget,” he said.
THE IMPORTANCE OF HAVING THE LARGEST LITHIUM DEPOSIT:
In 2019, the Nobel Prize in Chemistry was awarded to the development of lithium-ion batteries thanks to its application in our lives, for example, in medicine, but mainly in the technology industry, such as laptops, cell phones and electric cars. At the end of that same year, the largest lithium deposit that exists in the world was unveiled, it is located in Sonora, Mexico.
“Lithium-ion batteries have revolutionized our lives … Nobel laureates have laid the foundations for a wireless society, free of fossil fuels,” announced the Nobel committee, recognizing the three chemists who shared the prize: M. Stanley Whittingham, John B. Goodenough, and Akira Yoshino.
Lithium batteries are nothing new at all. The first battery developed with lithium was created by Whittingham in 1970, using titanium sulfide and lithium metal as electrodes; Goodenough identified less expensive materials and took it upon himself to develop more powerful batteries; Yoshino, in 1985, used metallic lithium materials to remove pure lithium and made them a marketable product.
Many years later, in a context of oil shortage that threatens the supply of fuels derived from this raw material, the production of electric motors based on lithium-ion batteries proliferates. According to the Mexican doctor Plinio Sosa Fernández, 2018 National Chemistry Award, “Lithium allows us to create rechargeable batteries, very light, that occupy very little space and very powerful. Those rechargeable batteries are in watches, cameras, telephones and “Of course, in electric cars. These batteries for the automotive industry will be very important in about 20 or 30 years. So, whoever has lithium and knows how to process it is going to have great advantages.”
At the end of 2019, the discovery of a lithium deposit in the high mountains of Sonora was announced. It was about proven reserves of 243.8 million tons of lithium and was considered by Mining Technology, as the largest deposit in the world.
“To put in context, Australia (the country that produced the most lithium in 2018) has 475 million tons, but counting all its deposits. On the other hand, in Mexico, apparently there are other deposits besides Sonora ”, according to Sosa Fernández.
Another example of the relevance that lithium is having at this time is that it has entered the list of strategic raw materials in Europe: “Every three years the European Union removes the list of Critical Raw Materials, which due to its relevance in applications technological, and others, are a target for the European Union. Lithium, in this latest review, is part of this list, ”Dr. Abigail Jiménez Franco, who worked in mineral deposits in Bolivia and is currently a researcher in Earth Sciences at the University of Barcelona, told Dinero en Imagen.
“It has other applications, for example, in the aeronautical industry, in the pharmaceutical industry, but particularly this use of lithium batteries has exponentially increased its interest in the world. Another thing that makes it interesting is that it is an unconventional strategic element, which is why it is not very abundant in nature, which limits its extraction and its potential to be exploited, so that also gives it a high value ”, added Jiménez Frank.
Finally, on September 22, Battery Day, Musk unveiled the 4680 cell, which promises five times more energy capacity and six times more power than the previous ones. From this announcement, came the promise of creating electric cars in 2023 capable of competing in power and equalizing costs of those of the combustion engine.
According to the Online Mining site, at this event Tesla announced its official entry into the mining industry, when it claimed a 10,000 acre lithium clay deposit in the state of Nevada.
Tesla estimates that the extraction and processing of lithium from the Nevada deposit would be enough for an entire fleet of vehicles in the United States.
It is true that the great deposit of Bacadéhuachi, Sonora, is located in our country, but the companies behind this project are Bacanora Lithium, from Canada, and Ganfeng Lithium, from China; Together they develop the Sonora Lithuim project, which aims to sell and profit in the Asian market.
The path for the development and production of lithium in Mexico is just beginning. The expectation is that the demand will grow over the years, but how much can Mexico take advantage of these resources? According to Dr. Plinio Sosa “That already has to do with the companies and the government… I don’t really know how the agreement is there, but of the 11 deposits, four belong to the government and of those four, three will be administered by individuals, so it depends on what the commercial agreements are and the profit for the country ”.
For Dr. Abigail Jiménez, it is not only about having a huge deposit, but also about the ability to work with it: “It is not only important that you find an anomalous quantity of an element when it is of economic interest, but also that it is a process that mineral is important because if there is not such a simple metallurgical or extraction process, the cost begins to rise, the process can become so expensive that you are always playing with the price-benefit, so for the miners it stops being interesting ”.
When questioning Dr. Plinio about what is needed in Mexico to develop technology at home, he shared this with us: “In Mexico, we have grown separately the three parties that should be (together): industry, universities and the Government. Universities do basic science, but we do very little applied science, unfortunately. Here we should take advantage of lithium to generate our own technology that we can sell ”.