Will Lithium Save Us from OPEC?
We have a major push into electric cars being touted by our present government masters as the way to break free of our “addiction to oil”. THE best battery technologies so far are based on Lithium. The Chevy Volt has it designed in, as does the Tesla (and several other makers).
So where do we get the Lithium?
Lithium salts crystalize out of salt lakes at a slightly different stage of drying than do other salts. You need to find places where rains, over millions of years, have washed salts out of the mountains and into dry salt lakes with persistent deserts, where they have slowly evaporated to allow the selective separation from recrystallization. Where does this happen? In very limited places.
There are small deposits in China, and some in North America in the dry lake beds behind the Sierra Nevada mountains in Nevada. But the largest deposits are in South America. Chile has a large deposit, and to a lesser extent, Argentina has some. But the “Saudi Arabia” of Lithium is Bolivia.
Bolivia has more than 1/2 of all the lithium deposits in the world.
Even the New York Times thinks this is an issue.
So Why Is This A Problem?
Bolivia also has a leftist socialist government that has nationalized oil, gas, and other mining operations. Their leader is a big supporter of Hugo Chavez in Venezuela. This, as they say, “could be a problem”…
Depending on who you listen to, the demand for lithium becomes a big impact on lithium prices between about 5 and 10 years from now (just about the time electric cars are projected to sell in anything more than token numbers. This too, as they say, “could be a problem”…
There is a similar, though smaller, issue with all the copper needed to make the electric motors, chargers, inverters, power transformers, increased grid capacity, etc.
And that is the Achilles’ Heel of the electric car movement. They can only be built at a slow rate in proportion with the global supply of those two metals or they will run into the inelastic supply curve of those metals. When excess demand meets inelastic supply, prices rise dramatically. This will “rate limit” the introduction of electric cars on a global basis. The only way out of this problem is to build many more and larger mines. Not exactly the darling of the same environmentalists who insist that the electric car will save the planet. Oh, and what do we do if Bolivia says that they do not want to dig up all the lithium at that rate?
So What’s a Person To Do?
Well, you could try to make some money off of it.
The major publicly traded stocks that mine lithium are FMC in North America and SQM in Chili. Copper is dominated by FCX Freeport Macmoran Copper and Gold and PCU Southern Copper. To the extent the “green agenda” is moved forward, those companies will have significant increases in demand and prices.
The Wall Street Journal calls this Peak Lithium. While even the greens tend to admire the issue (in a far off kind of way…) though their comments all run to “There can’t be a problem and why are you raining on my parade?!”
So which will it be? Thrall to a Bolivian socialist with the dominant share of world Lithium supply, or addicted to Saudi Sheiks’ oil? Your choice…
Me? I would go with Coal To Liquids using U.S. Coal. We have more coal than anyone else on the planet. Several hundred years worth, at least. And we do not need to ship money to either the Saudi or the Bolivian oligopolies. It does not take any new development. South Africa has done it for over 30 years.
It is a simple, proven, self reliant approach with no technical risk that will work and can be completed in about 5 years. So why is THAT the one plan that is put completely off limits by the socialist / green agenda? One can only wonder…
The known coal deposits in the U.S.A. alone will last about 250-400 years and maybe more, so we have plenty of time to continue business as usual while we ponder what to do next.
Original Map with more options shows where coal is in the U.S.A.; by my eyeball measurement it’s about 1/4 of the country.