Half red, half green: Argentina’s first fully lithiumpowered electric bus hit the streets earlier this month. “0% emissions” reads the huge sticker on the windscreen of the test vehicle, which can travel up to 200 km before having to return to the station to recharge its batteries.
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The product arriving in Latin America is already an old topic in Europe, the United States and China, and to travel such a distance, instead of a fuel tank, you need an amount of the mineral thousands of times larger than what cell phones or notebooks are used to focus. The climate, new forms of energy and the resulting societal changes will be the topics of the COP 30, the COP of the Amazon, which will take place in Belém do Pará in 2025
“[Precisamos] “Avoid approaching the issue from a colonial perspective,” said Argentine Minister Daniel Filmus (Science and Technology) at the launch of the bus, highlighting the major debate that has swept through the region in recent months and will continue for many years to come becomes: What is to be done? to do with the explosion in demand for lithium in the world.
STRATEGIC RESOURCE
As new mining projects continue to be announced, countries are deciding whether to focus on exporting to rich countries or investing in developing local industries. They are also debating whether to use it as a strategic natural resource, a priority for the state, or open up exploration to foreign investors. And it is still necessary to consider the environmental aspects.
Latin America concentrates more than half of the lithium found on the planet already nicknamed “white gold” and most of it is found in the “lithium triangle” formed by Bolivia, Argentina and Chile, mainly in the salt flats of Uyuni, Puna and Atacama, where the chemical element is obtained by evaporation.
But with prices hitting record highs over the past year, the frontiers of exploration have expanded. Brazil, which had virtually no carbonate production in 2015, now has 2% of the world market through rock drilling, a faster method and less weather dependent, but more expensive.
Mexico and Peru are also beginning to join the game, still dominated by Australia and few producers.
RESERVATIONS
The main drivers of new investments in the region are Chinese, American and European companies competing to guarantee reserves in view of the longawaited energy transition replacing fossil fuels with electricity from renewable sources, mainly in the automotive industry, which is growing strongly .
Almost all of Latin America’s lithium is shipped to these countries, first going through refineries that turn it into batteries, mainly in China, South Korea and Japan. This trend brings back the spirit of the word “colonization” as much of the debate focuses on the question: should we just export raw materials or make our own batteries?
“I worry that we might become a kind of literary bed to ensure the global North’s energy transition and reproduce some kind of neodependence, neocolonialism or green colonialism,” says Bruno Fornillo, researcher at the Conicet (National Council). for Scientific and Technical Research of Argentina) and coordinator of the study “Lithium in South America”.
However, Chilean Francisco Acuña, an analyst at mining consultancy CRU, counters that there is still not enough demand for electric vehicles in the region. Brazil, for example, is going against the tide by discounting the sale of popular cars. “Here they are still considered luxury items, there is no incentive. Most likely, until the manufacturing price of electric vehicles is competitive and it makes sense to produce batteries, Latin American countries will continue to export lithium,” says the engineer.
As far as lithium exploitation is concerned, nations have dealt with the issue differently so far. The Lula government’s focus has been on attracting foreign investors to extract, produce and export only high valueadded lithium concentrate, although it is exploring ways to develop the entire chain all the way to batteries.
LITHIUM VALLEY
A month ago, the company launched the “Lithium Valley” project on the New York Stock Exchange to promote exploration in the Jequitinhonha Valley in Minas Gerais. Brazil is moving in the same direction as Argentina, one of the fastest growing countries in the industry. The neighboring country is edging closer to a lithium free trade deal with the US and last month saw its only two carbonate producers, one from the US and the other from Australia, announce a merger into a multinational megacorporation.
Both go in opposite directions for some Latin Americans, although they are all leftleaning. In May, Chilean President Gabriel Boric caused quite a stir in the market when he announced on national television a new publicprivate lithium policy with more government control and the creation of a National Lithium Company (which has yet to be passed by the legislature). . and prior consultation with Andean communities.
Mexican Andrés Manuel López Obrador went a step further and issued a nationalization order for the mineral in February. “What we are doing now, in proportion, is nationalizing lithium so that it cannot be exploited by foreigners, whether from Russia, or from China, or from the US. Oil and lithium belong to the nation, they belong to the Mexican people,” the president said, in a strategy that has not yet been detailed.
Bolivia, on the other hand, does not produce lithium on a commercial scale, despite having the largest salt flats in the world, as for decades it has followed a model that has been rather closed to international investment and met with resistance from the regions hosting the resources. However, President Luis Arce is showing signs of flexibility and in January signed an agreement with Chinese consortium CBC to build two plants in the country by 2025.
Two months later, Gen. Laura Richardson, chief of the US Southern Command, voiced her concerns about “China’s aggressiveness over lithium.” “This region is full of resources and I worry about the evil activities of our opponents who are taking advantage of it. It seems they are investing when in fact they are mining,” she argued in a presentation to the House of Representatives.
In the tugofwar between the two powers, the future of lithium in Latin America is still considered uncertain, as is the industry’s environmental impact, which continues to be studied. The only thing that is certain is that the appetite for it should not stop anytime soon.