Rep. Bruce Westerman, (R-Ark.) chairman of the House Committee on Natural Resources, says China has moved ahead of the U.S. in mining natural resources, such as lithium, even as environmental agents examine possible environmental infringement by China's lithium suppliers.
According to a report by Time, China is responsible for 10% of the global supply of lithium and is now under an environmental probe from Beijing. Westerman has also criticized the Biden administration for not making use of domestic production of rare minerals and precious metals that can be used for lithium batteries. He warned that not keeping pace compromises our global positioning.
"Energy and mineral security is American national security. Full stop," Westerman said. "China is currently running circles around us in the energy and minerals sector, including lithium and American action is long overdue. The Biden administration should immediately cease and desist from their attacks on our natural resources and, instead, open the doors to the safest, most responsible production in the world right here at home."
Westerman argues mines, like Twin Metals in Minnesota, "could supply vast quantities of the nickel and cobalt needed for lithium batteries, but the Biden administration just prevented any development in the area for 20 years."
"Prospective lithium mines in Nevada are facing administrative challenges and meritless lawsuits across the state," he added. "On the rare occasions when mines can get through this administration’s approval roadblocks, they get stuck in years of permitting delays and litigation headaches."
Westerman said his committee has "championed a variety of bills mitigating these roadblocks and bringing mining back to where it belongs, here in America."
The BUILDER Act will "modernize NEPA and reduce permitting backlogs, the TAP American Energy Act would provide a much-needed jump start to American energy production," Westerman said. "The Permitting for Mining Needs Act would set reasonable time limits on reviews for mine projects, increasing clarity about project timelines and affirming the right to explore and conduct mining in the U.S. I’m proud to support these and other commonsense bills here on the Natural Resources Committee, and know we have lots of great work ahead."
According to the Time report, China's top lithium production hub faces sweeping closures due to a government probe of environmental infringements. The crackdown in Yichun, in Jiangxi province, follows a lithium frenzy over the past year, as miners raced to feed rampant global demand for the battery material and benefit from record prices. Ore-processing operations in Yichun have been ordered to stop production as investigators probe alleged violations at lithium mines.
"This supervision may mean that the inspection and control over lepidolite mining in China will be more stringent in the future," said Susan Zou, an analyst at Rystad Energy, in the Time story.
All lepidolite mining in Yichun, aside from those by a state-run company, has been suspended, but refineries are still operational, according to analysts at Daiwa Capital Markets. Beijing officials will mainly look at violations at lithium mines and seek to guide the "healthy development" of the industry and will largely target those mining without permits or with expired licenses, Time reported.
The Chinese car industry's demand for lithium has fallen by more than half in recent months, a reversal that will drive a further slump in the market. Prices in China have dropped more than 30% from last year's peak, and analysts say the shutdown of the lithium production hub might not do much to help lithium prices rebound from a recent decline.
"Any mine would typically have a stockpile of ore in place, so as long as the refineries are operating, you aren't likely to see any whipsaw in lithium pricing," said Chris Berry, president of House Mountain Partners, in the Time story.
Although the White House has tried to increase domestic production of lithium and other critical materials in support of a transition to green energy, many mining projects in the U.S. face challenges due to environmental regulations, Greenwire reported.
“The actions we have seen from the administration have really been contrary to providing that domestic mineral production,” said Mark Compton, executive chairman for the American Exploration and Mining Association, in the Greenwire report. “Right now permitting is still creating an unfavorable environment for attracting mining investment in the United States.”
China dominates the global supply chain for lithium, as well as other metals including cobalt, nickel and graphite.
In February, the House Committee on Natural Resources convened for a hearing called "Unleashing America’s energy and mineral potential." A hearing memo states China "unquestionably" dominates the global supply chains of minerals, both in terms of raw materials and refined products.
Meanwhile, mining projects in the U.S. typically take hundreds of millions of dollars in upfront capital costs and can take years to get through the permit process. The refining process for the minerals, once they have been mined, is also lengthy and expensive, the committee reported.
The 2022 cancellation of two 20-year-old leases in the Superior National Forest in Minnesota coincided with the withdrawal of 225,378 acres of mineral-rich land from mining, which ended last month.
"These actions specifically targeted a prospective copper-nickel-cobalt mine in the region, despite years of environmental review, a pending mine plan of operations at the Bureau of Land Management," the House memo said. "A myriad of comments and letters from members of Congress, mineral developers, local residents, union workers, and many other parties [are] stating their support for the project."
