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The head of Australia’s largest lithium miner says carmakers are ratcheting up scrutiny of the environmental impact of mining practices across battery supply chains.
As the era of electric vehicles begins to dawn and analysts forecast demand for battery minerals to surge at least five-fold by 2030, Orocobre chief executive Martin Perez de Solay said auto industry was racing to lock in large-scale supply agreements but was also focusing on sourcing raw materials as sustainably as possible.
Orocobre produces lithium from Argentinian groundwater, while Galaxy extracts it from Australian rock.Credit:.
A key concern for buyers of lithium, he said, was driving down their direct and indirect emissions including the carbon footprint caused by shipping lithium products to factories around the world.
“We are seeing that increasing,” Mr Perez de Solay said. “It’s of a lot of interest to our customers; we are already discussing with buyers of battery-grade lithium carbonate the reduction of ... emissions.”
As the transport sector accounts for about one-fifth of global emissions, the dawning of the electric vehicle age will have a meaningful impact in the push to avoid the worst and most immediate impacts of climate change. However, electric battery raw materials such as cobalt, copper and lithium must be mined from the ground and often transported long distances to be processed into higher-grade product, raising concerns about the sector’s wider impact on the environment.
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“Mining process currently accounts for roughly half of the carbon footprint of a battery cell,” Tesla chairwoman Robyn Denholm told an Australian mining conference in June. “And the best way to reduce the carbon footprint of minerals is to stop shipping them across 9000 kilometres of ocean before refining them.”
Orocobre and Galaxy Resources, two of Australia’s top lithium miners, last week completed a $4 billion merger and are on track to become the world’s fifth most-valuable producer of the sought-after electric battery raw material.
The combined company – to be named Allkem, subject to shareholder approval – will retain its primary listing on the ASX and have operations spanning brine and hard-rock lithium mining and processing around the world.