Khanij Bidesh plans to acquire cobalt, lithium mines in Australia, South Africa

Khanij Bidesh plans to acquire cobalt, lithium mines in Australia, South Africa

With energy storage solutions such as lithium-ion batteries holding the key to India’s energy security, state-run Khanij Bidesh India Ltd is scouting for acquiring cobalt and lithium mines in Australia and South America.

Also, the joint venture firm of National Aluminium Company Ltd (Nalco), Hindustan Copper Ltd. (HCL) and Mineral Exploration Company Ltd (MECL) is exploring the direct purchase of cobalt and lithium.

This comes in the backdrop of Chinese state-owned firms securing lithium mine concessions in countries such as Bolivia, Argentina, and Chile, which form the so-called lithium triangle. The idea is to not allow India to fall in a vulnerable position with a likely threat of supply squeeze as has happened in the case of crude oil, with India being the world’s third-largest oil importer.

“Khanij Bidesh India Ltd., which has been set up as part of the government’s 100-day agenda, is looking for acquiring strategic mineral assets in Australia and South America. Africa is not on the radar at the moment. The idea is to acquire cobalt and lithium mines as well as to get into purchase agreements of these minerals. This will help in achieving resource security with respect to strategic minerals," said a government official requesting anonymity.

India’s push for electric vehicles (EV) may lead to a substantial change in its energy security priorities, with securing lithium supplies, a key raw material for making batteries, becoming as important as buying oil and gas fields overseas. Given the changing global energy landscape, India has set up a National Mission on Transformative Mobility and Battery Storage. An inter-ministerial steering committee has also been set up which is chaired by NITI Aayog CEO Amitabh Kant.

The importance of such energy storage solutions can be gauged from the fact that John B. Goodenough of the University of Texas; M. Stanley Whittingham of the State University of New York at Binghamton; and Akira Yoshino of Asahi Kasei Corporation and Meijo University in Japan were awarded the Nobel Prize in Chemistry for their contributions to the development of lithium-ion batteries.

India does not have enough lithium reserves for manufacturing lithium-ion batteries. Almost all-electric vehicles in the country run on imported batteries, mostly from China. At present, a lithium-ion battery accounts for 40% of the total cost of an electric vehicle. Lithium also has other uses such as in mobile phone batteries and solar panels.

This strategic push by Khanij Bidesh India Ltd comes in the backdrop of India putting the final shape on a plan to build at least four Tesla-style Giga factories to manufacture batteries with an investment of around $4 billion. The plan to set up these factories of 10 gigawatt-hours each to accomplish what Tesla has done at its Gigafactory in Nevada, US, also involves a nearly $1 billion concessional loan facility to be drawn from multilateral lenders such as the World Bank, Asian Development Bank, European Investment Bank, New Development Bank and the Asian Infrastructure Investment Bank.

With India readying its roadmap for transition to electric mobility, leading global manufacturers of lithium-ion batteries are also exploring opportunities to first build assembly units, even as they eventually plan large-scale manufacturing of lithium-ion cells in the country.

Japan’s Panasonic Corp. is exploring opportunities to set up a facility for assembling lithium-ion (li-ion) battery modules in India. South Korea’s LG Chem Ltd and Japan’s Toshiba have also formed collaborations for assembling battery packs with Indian companies such as Mahindra and Mahindra (M&M) Ltd. Indian companies in the battery manufacturing space such as Exide Industries Ltd and Amara Raja Batteries Ltd have also formed joint ventures with foreign companies to start assembling batteries.

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