Copper and lithium scramble to power the energy future

Korean Land Ministry

Source: Korean Land Ministry

Forget the troubled US electricity grid, or European super-grid plans, not to mention far more remote African solar desert-to-Europe concept.

China is going ahead and securing Chilean copper for its own grid expansion plans.

Meanwhile, remember Renault/Nissan chief Carlos Ghosn’s comments at the Geneva Motor Show last week about electric cars? He predicted a scramble for the resources to produce green vehicles, including lithium.

China has some lithium reserves of its own – and is producing them at a fairly high rate – but Japan and South Korea, the other two biggest producers of lithium goods – have none.

In a sign that Ghosn might be onto something, South Korea recently began to talk much more confidently about its plans to make lithium from seawater. Japan has been working on such a technology for several decades but had previously deemed too expensive in comparison to simply importing it. South Korea, however, says it can do better:

The Ministry has promoted to develop marine dissolved lithium abstraction technology since 2000 and as a result the Ministry secured a source technology to collect lithium from sea water in May 2009.

The technology is 30% more efficient that the Japanese technology which has been under development for 30 years and is the world best in eco-friendliness.

It plans to have a pilot plant built by 2014, and have it producing by 2015. The ministry is very confident indeed:

It will not only meet domestic demand but dominate the global lithium market, which will ultimately contribute to the sustainable development of the eco-friendly car manufacturing industry.

South Korean companies however don’t seem confident enough that they are giving up on pursuing lithium imports: companies from both Korea and Japan have been seeking deals in Latin America in the past few years. Chile is the world’s biggest lithium producer, according to the US Geological Survey, while Bolivia has the world’s biggest reserves – although they are not yet assessed as being economically recoverable.

In fact Bolivia’s lithium reserves seem to be presenting a conundrum for everyone. President Evo Morales wants to develop them, but as this Bloomberg story relates, he is concerned about how the country – which is short on investment capital and expertise – can do so in a way that benefits the country. Japanese and Korean companies have, of course, been trying – as has French financier Vincent Bollore, who told the Geneva show last week that his alliance with Italy’s Pininfarina will produce tens of thousands of cars a year from 2013.

The plan to extract lithium from seawater, after all, is fairly long shot, and not everyone is convinced. From the FT:

In spite of such efforts, Samsung Economic Re-search Institute, one of Korea’s main think tanks, published a paper arguing Seoul was trailing rivals in the pursuit of rare metals. It recommended the bulk of the nation’s aid be linked to countries with such reserves and called on pension funds to play a bigger role in resource diplomacy.

The economics of those Bolivian reserves could change quickly if electric vehicles do take off as quickly as Ghosn predicts. Then again, if South Korea’s seawater efforts do manage to succeed, perhaps it could be a short-lived boom.

Related links:

Interactive: The lithium market (FT)
Electric vehicle excitement keeps growing (FT Energy Source)

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