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Energy Storage

DOE offers loan to Nevada lithium mine

The move is an effort to build up US production of minerals needed for batteries

by Matt Blois
January 19, 2023 | A version of this story appeared in Volume 101, Issue 3


In its first move to fund a lithium extraction project, the US Department of Energy (DOE) is offering the Australian mining company Ioneer a $700 million loan to build a lithium carbonate plant at its proposed lithium mine in Nevada.

$700 million

The amount of money the US Department of Energy plans to loan Ioneer for lithium processing in Nevada if the company obtains permits.

Ioneer must meet several conditions to receive the loan, such as securing permits. That’s a special challenge for this mine, which would be within the habitat of a flower that was added to the endangered species list in December. The South African miner Sibanye-Stillwater plans to invest $490 million in Ioneer’s project if permits are approved.

Howard Klein, president of the lithium advisory firm RK Equity, says the message is that the federal government is serious about building supply chains for battery minerals in the US, which currently has only one operating lithium mine.

“They’re very focused on the fact that we’re reliant on China for a lot of these materials, and they need to level the playing field . . . by providing government funding like China does,” Klein says.

The DOE issued guidance in 2020 that encouraged companies developing “critical mineral” projects to apply for loans. In 2021, the agency awarded Syrah Technologies a $102 million loan for a Louisiana graphite facility. Piedmont Lithium and Lithium Americas have also applied for DOE loans to finance lithium extraction projects in North Carolina and Nevada, respectively.

The DOE program funds lithium chemical production, such as converting lithium ore into battery materials, but stops short of loans for removing ore from the ground. Klein says chemical processing plants can represent a significant portion of a mine’s start-up costs.

Ian Lange, director of the Mineral and Energy Economics graduate program at the Colorado School of Mines, says these loans will help companies extract battery materials in the US but that getting permits remains a big challenge. “Permitting is done by a different agency, with different political pressures,” he says.

Reducing the time it takes to reach a final permitting decision would be a better way to encourage US production of battery minerals, Lange says.



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