29 rare earth mines missing

According to the magazine Focus, solar and wind power are expected to become our most important sources of electricity by far by 2035. The International Energy Agency (IEA) assumes that green forms of energy could cover half of the world’s electricity needs as early as 2030. But where are the metals required for this supposed to come from?

The energy transition consumes a vast amount of metals and raw materials such as lithium. For the latter, UN Trade and Development (UNCTAD) predicts a 1,500% increase in demand by 2050. Demand for nickel, cobalt, and copper is expected to be similarly high. According to DERA, the demand for rare earths for wind power will also increase 5 to 6 times from 2018 to 2030. According to UN Trade and Development, the investments required between 2022 and 2030 amount to 360 to 450 billion US dollars. The potential gap, the largest part of which is accounted for by nickel and copper at 36% and 16% respectively, is between 180 billion and 270 billion US dollars. Only two percent of the global budget for mineral exploration is allocated to the EU.

The current quantity of metals produced is not sufficient if global warming is to be reduced to 1.5°C in accordance with the Paris Agreement. To achieve Net-Zero targets by 2030, the world needs 80 new copper mines, 70 new lithium and tin mines each, and 30 new cobalt mines. These would also be needed for the scarce technology metals indium and gallium, which are also required for the energy transition. This is because these do not occur in nature in their pure form. According to Benchmark Mineral Intelligence, the leading market research firm for battery raw materials and the electric vehicle supply chain, 29 rare earth mines are also missing.

This gap could be closed with investments in resource-rich countries like Africa. More than a fifth of the world’s reserves of 12 metals indispensable for the energy transition are found there. 19 percent of these are metals required for electric vehicles, such as the rare earths neodymium oxide and dysprosium oxide required for magnets.

If countries like Africa undertake not only the mining but also further processing steps, they can benefit from their mineral resources and become an important part of a supply chain that is independent of China. We at the Noble Group have therefore been committed to a mining project in South Africa for some time (read more about this), through which Europe could obtain the four most important rare earths for magnets – and very soon.