Is sustainable mining possible? The EV revolution depends on it.

Source: By Evan Halper, Washington Post • Posted: Thursday, August 11, 2022

A proposal for a ‘sustainable mine’ in Minnesota has the backing of Tesla. But will it win over the community?

Drill cores are stored at Kennecott Exploration’s core shed in Tamarack, Minn. Geologists collect geotechnical data like density and conductivity and saw the core in half before sending it to a laboratory for tests. (Dan Kraker/Minnesota Public Radio/AP)

TAMARACK, Minn. — Electric cars are still rare in this marshy stretch of central Minnesota, where it is more common to pass a flock of wild turkeys on the country roads than a Nissan Leaf.

But the region could have an outsize impact on America’s transition to zero-emission vehicles. Tamarack, sitting atop a treasure trove of metal used to power electric cars, is fast becoming a test case of whether the auto industry can meet this critical climate moment by sourcing colossal amounts of battery materials domestically and sustainably.

The climate package awaiting a vote in the House as early as Friday gives new momentum to companies such as Talon Metals, working to persuade locals that it can extract thousands of tons of nickel without making an environmental mess. The legislation includes billions of dollars in tax credits available only to purchasers of electric cars built with components from the United States or a handful of friendly nations.

Few car models would even qualify right now. The climate package would push automakers to remedy deep instabilities in their supply chains and confront the unnerving control China and other rival nations hold over the minerals crucial to scaling up electric vehicle production.

Yet companies like Talon Metals, which aims to mine in Tamarack, face big hurdles. Americans have long been content to outsource mining and its legacy of contaminating water and air.

“The history with these types of mines is pretty terrible in the U.S.,” said Tom Anderson, whose family has owned property in Tamarack since his great grandfather built a homestead three miles from the proposed mine in 1896. “They could make it clean if they spent enough money, but nobody has ever done that.”

Adding to the challenge faced by Talon — and mine developers across America — are concerns from tribal communities that the projects will contaminate pristine lands. Some tribal officials here are already girding to fight.

“This area is just too precious to leave to chance,” said Jean Skinaway-Lawrence, chairwoman of the Sandy Lake Band of Mississippi Chippewa.

It is a growing conundrum for climate activists: meeting the Biden administration’s ambitious goals for cutting car emissions hinges on the quick approval of large, invasive projects environmentalists are predisposed to resist. Mining companies are trying to use the timelines for the energy transition to their advantage, promising wary conservation and tribal groups to shape projects around community concerns.

“This isn’t your grandfather’s mine,” said Brian Goldner, who heads exploration at Talon, which has a contract to sell electric vehicle pioneer Tesla 75,000 tons of nickel pulled from the earth here — if Talon can get an extraction operation fully online at a breakneck pace, by 2026. “There have been a lot of changes. It is like comparing the crash-test ratings of a car from the 1960s with one from today.”

Talon has not yet submitted its permit application, but its plans are mapped out in financial disclosures, and the company has been aggressively promoting the project since enlisting Tesla as a future customer. Talon is currently doing extensive exploratory work on the site.

It is Tesla’s first U.S. nickel deal, inked after Tesla chief executive Elon Musk implored U.S. companies to mine the metal and promised a big contract to any company that could do it sustainably. The only existing nickel mine in the United States, in Michigan, is slated for closure in 2025.

Talon officials insist locals will guide how it is built, who gets jobs there and what social investments Talon will make in the community. The mine would bore 2,000 feet into the earth, they say, but operations would be almost entirely underground, with only a few buildings, a tunnel and construction equipment contained within a 60-acre foot print on the surface.

“Everybody who lives in this area, including our employees who live here, wants to protect the environment,” said Todd Malan, Talon’s head of public affairs and climate strategy. “We want people to come and voice their concerns so when we come out with our plan, we can show we addressed them in a meaningful way, even if it costs us money.”

Malan talks of sophisticated water treatment plans and state of the art air-filtering and storage technology to keep toxic dust out of the community. The area would be mined with “surgical” techniques that limit disturbance of the earth, he said. Talon also plans to pair its mining with a project for fighting climate change, storing massive amounts of carbon — potentially vacuumed from the air with futuristic machines — within porous rock on its property.

The firm has won a $2.2 million grant from the Department of Energy to pursue the carbon storage project, and it won plaudits from the White House for a partnership it forged with the United Steelworkers union.

But Talon has yet to win over everyone in the community. Even as local political leaders enthusiastically echo Talon’s talking points — and many in the area welcome the hundreds of good-paying jobs the mine would bring — the long history of sulfide mining contaminating American lakes and rivers has some in the community asking why this project has to happen here.

“Even at its best, mining can be disruptive and intrusive,” said Sarah Ladislaw, a managing director at RMI, a clean energy think tank. “People want to know why it has to be done in their community. They ask, ‘are we recycling all the materials we can? Are we doing all the things that need to be done so we are not just going back to extracting?’ When you look around, the answer is often that we are not doing everything we can.”

The International Energy Agency warned last month that battery and mineral supply chains will have to expand tenfold over the next decade to meet the world’s goals for electrifying the transportation fleet.

The agency urged world leaders to invest more heavily in mining to meet what they forecast will be crushing demand from automakers. The market for lithium, for example, is expected to grow more than 40-fold by 2040, according to the IEA. Demand for nickel, cobalt and graphite is projected by the agency to grow as much as 25 times what it is today.

Unstable supply chains and geopolitics currently leave these materials vulnerable to price shocks.

Russia controls about a fifth of the world’s high-grade nickel — an ingredient prized by automakers for helping extend the range and power of batteries — which led to prices briefly doubling when the United States and European countries imposed sanctions after the Ukraine invasion. A lithium price jump from $17,000 per ton last year to $78,000 in the spring was called “insane” by Musk in April, leading him to project that “Tesla might actually have to get into the mining & refining directly at scale, unless costs improve.”

The costs have not dropped since then.

The immense demand for these metals is driven not only by the millions of electric cars coming onto the market but also the electrical grid that will power them. It needs to be substantially expanded and simultaneously run much cleaner to meet the Biden administration’s climate targets.

That will require the production of thousands of Mack-truck size batteries like those that fill the rural Vermont warehouse of a company called Kore Power. The firm helps utilities store wind and solar power so it can be fed back onto the grid at times such renewable energy is not being generated, like overnight, when drivers charge their vehicles.

“This is something a lot of people don’t realize,” said Jay Bellows, Kore Power’s president, as he walked among the towering batteries. “The grid isn’t designed for significantly more capacity than it can handle right now. But with EV market growth, we’re going to need to generate twice the electricity we currently do. We have to make that work.”

Permitting mining projects that help provide the metals needed can take a decade. The company Twin Metals has spent more than a half-billion dollars since 2010 to develop a copper sulfide mine near Boundary Waters Canoe Area Wilderness in Minnesota that it says would provide enough nickel to make 7 million electric vehicle batteries. Environmental activists warned that the plan threatened some of the nation’s most prized wilderness. The Biden administration in January heeded their call to revoke key permits, imperiling the project.

Plans for a massive lithium mine in a remote area of Northern Nevada known as Thacker Pass are jeopardized by legal challenges from a coalition of tribal officials and ranchers who say the mine would destroy critical habitat and ancestral hunting grounds. Activists have been occupying a protest camp on the site since early last year.

Another large lithium mine proposed in Nevada is mired in a fight over Tiehm’s buckwheat, a rare wildflower on the site, which could go extinct if the mine is built. The developers of a proposed large lithium mine in North Carolina say that even if their project and others get fast-track approval, there initially won’t be enough of the metal on the market to supply all the battery factories automakers in the United States are bringing online.

“They have all made these pronouncements about how many electric vehicles they will sell,” said Keith Phillips, chief executive of Piedmont Lithium. “But it is a fact that some of these plants will be empty. There won’t be enough lithium fast enough.”

Many of the mines proposed in the United States present significant environmental justice challenges. Native American reservations are located within 35 miles of 97 percent of the nation’s nickel reserves and 79 percent of its lithium, according to MCSI, a firm that researches investment risk.

Yet some in the battery industry are confounded to see some projects held up for reasons they regard as trivial and unrelated to the legitimate environmental justice concerns at other proposed mines.

“We need government to say, ‘sure, we love wildflowers, and we’re going to respect environmental and social governance standards, because that’s part of our culture,’ ” said Brian Menell, chief executive of TechMet, an investment firm that targets “technology metals.” “But, at some point, we’ve got to say, ‘mister wildflower group, you had your say, and now go and shut up. We are going to develop this mine, even if we destroy the habitat of a wildflower, which everybody would regret. It’s better than destroying the world with climate change.’ ”

At the same time mining companies are aggressively trying to reposition themselves as green and open-minded in their effort to move projects forward. Talon Metals has not even filed for its permits yet, but it has been coalition-building for months.

That is cold comfort to Jean Skinaway-Lawrence and her sister, Liz Skinaway, who for all their lives have been harvesting native wild rice on lakes within a few miles from where Talon wants to mine nickel. This area of Minnesota is one of the only places in the country where this crop that for centuries has been central to the culture and economy of the local indigenous people still grows in the wild.

The Skinaways no longer make their livelihood off the dwindling wild rice crop, but they still live on a lake near the proposed mine and run a camp to teach people native harvesting techniques in the hope of keeping the tradition alive. Their band of Chippewa includes just a few families. They are urging bigger tribal groups not to strike a deal with Talon to support the mine.

A local general store has in its files the receipts from the 1950s, when earlier generations of Skinaways would unload their rice haul right at the lake and sell it to traders waiting on shore.

“The wind travels,” Skinaway-Lawrence said as a gust blew across Lake Minnewawa. “This toxic air will travel. It will come into the lakes. It will devastate the fish. It will devastate the wild rice. It will.”