European Lithium welcomes Austrian mining minister’s call20.Jan 2022.
The company expects minister Elisabeth Köstinger to visit the Wolfsberg Lithium Project early in 2022.
European Lithium Ltd (ASX:EUR, OTCQB:EULIF) has welcomed a call from Austrian Minister for Agriculture, Regions and Tourism Elisabeth Köstinger to accelerate the domestic extraction of raw materials to make Austria more independent of imports.
Köstinger, whose ministry is responsible for mining and raw materials since 2017, also wants to promote a circular economy and cooperation with resource-rich countries.
European Lithium, which is advancing the Wolfsberg Lithium Project in Austria, welcomed the minister’s call as it completes key milestones toward development.
The company recently tabled an analysis of lithium carbonate and lithium hydroxide produced using samples from the Wolfsberg Lithium Project.
Importantly, the results demonstrate that high-quality, battery-grade lithium product can be produced from Wolfsberg with very low impurities.
Raw Materials Master Plan 2030
Elisabeth Köstinger, together with the president of the Federation of Austrian Industries Georg Knill, recently presented the “Raw Materials Master Plan 2030”.
Together with the industry, the ministry has defined 75 measures in the master plan by which the Austrian mining industry is to be strengthened and resources are to be better used.
The plan highlights the environmental advantages of mining and processing raw materials in Austria compared to less strict conditions in other parts of the world.
“Austria is heavily dependent on imports for raw materials,” said Köstinger during the master plan presentation.
“China and South America dominate the market, and there are always delivery bottlenecks.”
As an example, Köstinger cited the blockade of the Suez Canal by a pinned container ship this spring.
“An even more recent example was the shutdown of coal-fired power plants in China during the Winter Olympics to improve air quality,” added Köstinger.
“As a result, the magnesium supply was massively restricted.
“We can still feel the effects on the European market today – on the one hand massive delivery bottlenecks, on the other hand the prices have risen many times over.
“That is why one must accelerate the extraction of raw materials in Europe and Austria to become more independent and more crisis-resistant.
“This would also boost the labour market as the raw materials industry currently employs around one million people in Austria and contributes around 90 billion euros to GDP.”
Raw materials for energy transition
“The energy transition is also contributing to the increase in the demand for raw materials,” said Köstinger.
“In the Renewable Expansion Act, for example, very ambitious targets for the expansion of photovoltaics have been set, but mineral raw materials are required for this.
“Some of these can be obtained in Austria.
“Numerous raw materials such as silicon, indium, gallium and, above all, germanium have to be imported from other European countries so that the photovoltaic systems can be built, and electricity can be produced with them.”
Resource upgrade and Traxys deal
Earlier this month, European Lithium upgraded the Wolfsberg Lithium Project’s total resources by 11% to 12.9 million tonnes at 1% lithium oxide after finalising the resource estimation based on the infill drilling program in Zone 1.
An increase in resources means an extension of mine life from what was previously announced in the pre-feasibility study (PFS).
The company also marked another key milestone this week by agreeing to pursue a cooperation and offtake partnership with Traxys Europe S.A.
Traxys aims to support the development and commercialisation of Wolfsberg by retaining exclusivity until the end of the first quarter of 2022 to finalise an offtake deal.
It will leverage its banking relationships to support European Lithium to structure appropriate project financing and provide working capital to the Wolfsberg Lithium Project.
Traxys will also be considering a direct investment in the company.
Massive demand for raw materials
Federation of Austrian Industries president Georg Knill explained that massive demand for raw materials runs in parallel with strong economic growth.
“Globally we are growing by 6% – the last time we saw this growth is in 1973.
“The raw material producer China consumes a large part of its resources itself.
“The price of manganese rose by 34% from October to November, chromium by 50%, the price of lithium, which is needed for car batteries, has almost doubled since the middle of the year, the price of copper had increased by 19%.
“The higher price level also means that the mining of some raw materials in Europe, which was previously unprofitable, is now making economic sense.”
The EU Commission is pursuing the approach of strategic autonomy, said Knill.
“This should not be confused with self-sufficiency, because Europe will never be able to mine all the raw materials it needs itself, rather it is a matter of guaranteeing availability in Europe through partnerships.
“However, Austria has the largest tungsten deposit in Europe in Mittersill (Salzburg).
“As far as the planned lithium mining in Carinthia is concerned, the Mining Ministry assumes that a mining plan will be submitted next year.”
Lithium mining will have to increase tenfold
For the double transformation – digitisation and greening – massive investments are necessary, said the federation president.
The annual capacity of lithium mining will have to be increased tenfold to achieve the European targets by 2050.
“In the case of cobalt, the mining capacity has to be increased sixfold, in the case of graphite it has to be quadrupled.
“By 2050 we will also have to mine as much copper as has been mined globally in the last 5,000 years since the Copper Age,” said Knill, referring to World Bank calculations.
“The transformation brings you into new dependencies.”
Dependence on developing countries
Köstinger said that Austria should also rely on cooperation with producing countries.
The minister referred to a study by the University of Leoben in Austria, according to which 60% of global mining production takes place in developing countries.
“In the past two decades, mining activities in Europe have declined by 28%, while they have increased in China by 109%, in Africa by 30%, in the USA by 23% and in Australia by 144%.”
“We are not interested in dismantling everything in Austria,” added Köstinger.
“Politicians should also act as a door opener.”