Bolivia Rebuffs LG and Mitsubishi, Eyes State-Owned Lithium Ion Battery Venture

With international demand for lithium expected to rise precipitously for at least the next two decades—thanks in part to anticipated growth in the electric vehicle industry—the country that controls the world’s largest supply of the mineral is just now making progress in capitalizing off of its resource.

Bolivia, a landlocked country that is thought to be home to about 50 percent of the world’s lithium supply, is promising to begin production at its first major lithium mine and processing center in 2014. That mine, which is located in the Uyuni salt flat, will be planned in collaboration with South Korea, which will in turn receive a claim to 30 percent of its products.

Global demand for lithium is expected to as much as triple in the next decade, and companies like LG, Mitsubishi, and Sanyo—which is planning a 1000-percent increase in annual lithium ion battery production in just five years—are currently jostling elbows in an effort to lock down the resources that will allow them to profit from that boom. But despite the international sourcing scramble, South Korean and Japanese state-owned mining entities are to date Bolivia’s only partners in developing its lithium reserves.

That’s because according to President Evo Morales, those reserves are worthless if they don’t provide the nation with a path to long-term prosperity. That means building industry inside Bolivia to manufacture the lithium batteries that result from mining—terms to which no foreign companies have so far been willing to agree.

“ All the companies want to invest just to buy lithium carbonate. And why do they want to buy only lithium carbonate from us? So the lithium battery industry remains outside Bolivia. ”

Bolivian President Evo Morales

Last year, talks broke down between Bolivian negotiators and several major international corporations, including LG, Bolloré, and Mitsubishi. With nobody interested in sourcing battery production to Bolivia, Morales has recently stated that his country will attempt to build its own industry from the ground up—a notably ambitious undertaking for a nation with such limited background in technological manufacturing and development.

If he can find a technology partner, Morales is willing to invest as much as $900 million to grow a new domestic high-tech battery industry. Still, there is little hope of selling electric vehicles at high volumes in Bolivia—whose per capita income is less than $4,500 a year—or in South America at large, where electric vehicles are projected to see little traction in the short-term thanks to low fuel prices and abundant petroleum reserves. At some point, Bolivia would have to find overseas trading partners for its batteries.

Bolivian Standoff

Some have suggested that Morales is posturing in his threats to shut foreign companies out Bolivia’s lithium mines in favor of what would essentially be a giant, socialized clean-tech startup. It’s unlikely that the leader’s popularity will continue to reach new heights if he’s unable to deliver on promises of a better life for the millions of poor people who helped re-elect him last year with a 63-percent majority. In order to fund those promises, Bolivia will have to find new sources of revenue outside of its natural gas industry—which was socialized in 2006 in an effort to keep more of its revenues inside of Bolivia.

And so, Morales and his foreign suitors could continue to remain in a standoff until a scarcity in new lithium production couples with Bolivia’s need for revenue to reach a critical threshold. The country recently agreed to a deal that will allow it to own its first port, located on the Peruvian coastline. That port will one day send millions of tons of lithium to markets around the world—the question is whether it will be in the form of lithium carbonate or finished battery products.

In the meantime, it should be interesting to see just how far Bolivia gets in its quest to build a new nationalized electric car or lithium ion battery industry from the ground up.

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  • MrEnergyCzar

    Let the Lithium wars begin….. I’ve prepared my home for an electrfied vehicle for next year by making a net-zero solar home. I attached one of my videos showing the changes in how my family lives….


  • JamesDavis

    Isn’t it ironic that America has an uncanny ability in choosing products and countries that has a high potential to start wars? It seems like we cannot learn a lesson even when the house falls on us – first oil and now lithium carbonate. Why doesn’t America trade (money for oil) Bolivia the money and technological help they need to build their lithium mine and battery plant with the option of having first bids on the batteries when produced. That way we get two products we need and help a poor country up on its feet so they can support themselves better —

    Or, we can build our own battery plant and build the liquid metal battery that can carry a super charge. I hear that the main metal used in liquid metal batteries is aluminum and we have a lot of that. Heck, we can even use the soda pop companies recycled aluminum cans and the pollution that comes from aluminum isn’t even quite as dangerous as the pollution from oil (CO1 and CO2).

  • Anonymous

    Good idea James

    As long as we have a voracious appetite for every commodity, we will keep depending on foreign resources. Even a democratic country if it has most needed resource will become arrogant.

    Infact Brazil has recently become an Oil exporter by replacing gasolene with Ethanol and now they dont listen to what USA says.

    Atleast this Bolivias Lithium will challenge OPEC Oil and competition is good for us.

    So the wise thing for us is to use Plugins which use limited amount Lithium (for 40 mile range) and also use the petro-fuel or CNG or Ethanol for the maximum range.

  • History repeat itself

    If Asians lost the technical knowhow beacuse if western imperialism and able to “regain” techonological expertise in the last few decades, Mabey the Inca Native Americans can to the same since the ancient Inca were very advanced for their time only to get the techological expertise taken from by them by European smallpox imperialism but now working hard to regain it like the Asians did. Only the Asians have become the NEW Imperial westerners and terrorizing Africa which is why Bolivia won;t let a repeat of it their country.

  • Collin Burnell

    I wouldn’t be surprised if we found similar Lithium resources in our own Bonneville Salt Flats and Northwest Nevada.

  • John K.

    CB, if we do, they’ll immediately be declared environmentally sensitive areas and blocked from any mining. I’m sure the antis will find some snail darter, owl, or something they’ll declare endangered to keep the US dependent (“interdependent”) on other nations.

    I offer a modest proposal: Hugo Chavez should immediately declare war on Bolivia, invade it, and conquer it to protect the price of their oil and to control our electric future. LOL!

  • Lad

    Li is the element on the stage presently; As you suggest that might not be the case a few years from now or if someone makes a huge local (U.S.) strike of Li. I know Nevada has the metal; perhaps other states have it also. In any case, it does the BEV movement little good to withhold Li from the market in hopes of limiting the suppy and keeping the price up.

  • signumbox

    The world is plenty of lithium. Currently there are more than 70 lithium projects that are being developed mainly in Argentina, Canada and in the US. Hybrids and EVs wont be affected by the decision of Bolivia´s government, because even not considering Bolivia´s resources there is enough lithium in the world to meet future requirements.

  • Raymond Trahan

    I am looking for help in converting my Mazda MX% to electric THANK YOU Ray