RENO, Nev. (AP) – The U.S. Department of Energy on Friday announced a $700 million conditional loan to an Australian mining company for a lithium project in Nevada that still faces environmental hurdles, as the U.S. seeks local supplies for a key electric vehicle component. batteries.
The move ups the ante for what is already a big fight over President Joe Biden’s energy agenda and conservationists fighting to protect an endangered wildflower found only at a proposed mining site in the high desert ridge between Reno and Las Vegas.
Ioneer Ltd. It hopes to begin mining at Rhyolite Ridge in Esmerelda County by 2026. The energy announcement said the site could produce enough lithium to support the production of about 370,000 electric vehicles each year for decades.
The Energy Department said the loan would be the latest project to demonstrate the Biden administration’s commitment to strengthening the nation’s battery supply chain, electrifying the transportation sector and reducing dependence on fossil fuels and imports.
Jigar Shah, director of DOE’s Office of Credit Programs, said his office is “pleased to further develop an environmentally responsible U.S. supply chain for critical materials.”
“Rhyolite Ridge is a big step towards boosting domestic lithium production for clean energy technologies,” he said.
James Calaway, Ioneer’s executive chairman, said the conditional commitment “underscores the project’s strategic role in strengthening the nation’s critical mineral supply chain to ensure a safe, sustainable and reliable domestic source of lithium for the growing automotive ecosystem.” Bernard Rowe, Ioneer’s managing director, said it came after 23 months of “discussion and due diligence” by Energy and “represents a significant milestone” for the project.
But the project still faces a significant legal and regulatory challenge in developing a mining operations plan that would provide adequate protection for the endangered Nevada wildflower, Tiehmin’s buckwheat.
The U.S. Fish and Wildlife Service declared it endangered last year, saying it was on the brink of extinction and that a mining project was the single greatest threat to its survival.
Conservationists have sued in the past to protect the 6-inch-tall plant with yellow flowers and vowed to do so again Friday if necessary.
“This is a fairly transparent effort by the Biden administration to create political and economic momentum for a project to gut the US Fish and Wildlife Service and the Endangered Species Act,” said Patrick Donnelly, director of the Great Basin. Center for Biological Diversity.
“Ioneer will have to completely overhaul the design of this mine if they wait to get through the permit,” he told The Associated Press in an email. “We have already sued or been sued four times over Tiehm’s buckwheat, and we will not back down until every buckwheat is contained.”
The Ioneer project is working to minimize impacts to the plant, the Energy Department said in an announcement. He said the loan is contingent upon the completion of an environmental impact statement in accordance with the National Environmental Policy Act (NEPA).
The Biden administration has laid out a plan for half a million charging stations for electric vehicles, a signature part of its infrastructure goals. This effort, and the growth of electric car companies like Tesla, will require more lithium to make batteries.
Although lithium reserves are widely distributed around the world, the US is home to only one active lithium mine in the state of Nevada. Worldwide demand for lithium was about 350,000 tonnes (317,517 metric tons) in 2020, but industry estimates project demand to grow up to sixfold by 2030.
Shah said that such big projects are progressing step by step.
“We are clearly not putting any capital into the project,” Shah told the AP in a telephone interview on Friday. “They still have to comply with the conditions. But in doing so, it gives their shareholders some comfort to continue investing in the project.”
Sen. Jacky Rosen, D-Nev., is among those supporting the bill.
“I applaud the Department of Energy for providing this loan to support the extraction and processing of Nevada’s critical minerals, help reduce greenhouse gas emissions, and contribute to job creation in our state,” he said.
Lithium is the basis for the most common battery technology in electric vehicles and battery electric storage systems. But many engineers are working on alternative battery chemistries because lithium involves rock mining, which is a huge environmental concern.
Ioneer is a lithium-based company based in New South Wales, Australia and Reno.
Another new lithium mining project being developed in the US is proposed for Thacker Pass by Lithium Americas near the Oregon line. This northern Nevada mine will produce millions of tons of lithium, but it also faces legal challenges. Native American tribes claim it is located on sacred land near the site where dozens of their ancestors were massacred in 1865.