The Saudi Arabia of 1910 did not exactly draw the world’s gaze upon itself. Its heat-raked sands were filled with disputes by poor, warring tribes, and its king, Ibn Saud, had never ridden a train. St John Philby, the king’s adviser, had to exert himself to convince Western companies that Saudi Arabia was “like a man sleeping atop buried treasure”. In response, one American tycoon gently suggested that Ibn Saud was better off digging for water.
Geopolitics: The Salar de Uyuni salt flat in Bolivia hides a rich vein of lithium. Dinodia
Only after experts grew surer of finding oil did the US formally recognize Saudi Arabia, in 1931. Only in 1943, five years after commercial quantities of oil were discovered, did the first American ambassador leave for Riyadh. The subsequent story—of how the development and politics of West Asia were warped by oil—is instructive, and in some fashion, it may replay itself with what is touted as the next great energy resource of our age: lithium, atomic number three.
The hype—and the usage of that inevitable phrase, “the new oil”—has already begun. The laptops and handheld electronic goods that run off lithium-ion batteries use only minute measures of the metal, yet demand has risen so sharply that the price of lithium carbonate jumped from $2,000 per tonne in 2004 to $5,500 in 2008.
But the real hunger is just beginning. Far larger amounts of recyclable lithium will go into the batteries of clean electric vehicles that car manufacturers are feverishly planning, seduced both by subsidies as well as the chance, for once, to come off as the good guys and save the planet.
Most marketed lithium comes from pools of alkaline brine in Chile and Argentina, extracted through a process that can run for as many as 18 months. One other lithium reserve of significant size is said to lie in Tibet, already a region mired in strife and controversy. More than one-third of the world’s lithium, the biggest prize of all as one Mitsubishi executive told The New York Times recently, is in Bolivia—fiercely statist, unpredictable Bolivia. “If we want to be a force in the next wave of automobiles and the batteries that power them,” he said, “then we must be here.”
If lithium comes to even approximate the value of oil, its erratic distribution seems to invite reprises of the resource curse: more rentier states and rent-seeking politicians, more conflict over resources, more cartelistic moves from the lithium equivalent of Opec. But FMC Lithium and Chemetall, the world’s two largest lithium producers, profess not to worry, particularly about “cartelization”. One executive said, “The resources are controlled by companies, not countries. Companies will always abide by supply and demand,” quite forgetting that, for instance, the oil in Iran was controlled by a company until it was nationalized, in one swift move, by Mohammad Mossadegh in 1951.
Already, in China and Bolivia, governments have played true to form. Only the word of the China Tibet Information Center certifies a particular lithium mine as the largest in the world, and few experts will claim to have an accurate idea of China’s plans to extract its lithium. The quality of Bolivia’s reserves is as yet uncertain, and industry hands are surprised that the Bolivian government has not approached any lithium company for expertise and experience. In fact, Bolivia has reportedly turned down lucrative offers to develop its lithium, in favour of going solo; last February, the government’s mining arm invested $6 million in the first of its plants.
But far more than geopolitics, another question seems to animate the lithium community: Is the lithium enough? In 2008, two analysts responded and re-responded to each other’s white papers in an engaging tussle. Keith Evans, a geologist, was confident that the earth would yield enough lithium for many hundreds of years; William Tahil, a research analyst, wrote that lithium could power perhaps a fraction of the world’s electric vehicles for a very limited time.
Tahil’s prediction is alarming, since it would involve a near-seamless transition from peak oil to peak lithium; we would merely be exchanging one short-term energy resource for another. Even when they are most optimistic, proponents of lithium can see only 10-20% of the world’s automobiles running on lithium-ion sources, because of the high costs of producing such batteries. So lithium, as a fount of energy, is neither perennial nor universally adoptable—but it is a viable alternative, to be worked into a larger energy framework.
“We can talk about fuel cells and fusion all we want, but the truth is, they don’t work right now,” a Chemetall executive pointed. “What works is lithium, and we have to go with what works.”