Why Elon Musk and Tesla are banking on a Minnesota nickel mine

As automakers world wide set daring targets for automobile electrification, many within the business want to nickel — an integral element of most lithium ion batteries — as a significant hurdle.

Whereas there’s sufficient nickel within the floor to assist a significant EV ramp up, there should not sufficient deliberate mining tasks or processing services to make the kind of high-grade nickel that is wanted for EV batteries.

In the meantime, the nickel content material in battery cells is just rising, in response to Mark Beveridge at Benchmark Mineral Intelligence. That is as a result of extra nickel means power density.

“We’re heading in direction of, , 90 % of the cathode being nickel for sure particular cell sorts,” Beveridge mentioned.

Russia has plenty of high-grade nickel, and its invasion of Ukraine has despatched prices soaring to record highs due to fears of supply disruptions, even inflicting the London Steel Change to suspend nickel trading for a week.

In the meantime, the U.S. is brief on home nickel sources. The Eagle Mine in Michigan is the nation’s only primary nickel mine, and it is anticipated to close in 2025.

Enter the proposed Tamarack Mine in Minnesota, which is being developed by Talon Metals and mining large Rio Tinto. Though it is but to undergo the allowing course of, Talon has already secured a supply deal with Tesla to get Tamarack nickel into EV batteries.

Elsewhere although, the mission pipeline for brand spanking new, high-grade nickel mines has largely dried up, and communities typically push again in opposition to proposals for brand spanking new mining tasks.

The Tamarack mine isn’t any exception.

Paula Maccabee, a Minnesota lawyer serving because the Advocacy Director and Counsel for the nonprofit WaterLegacy, has questions. “How a lot nickel can be moving into our ingesting water? The place will that poisonous nickel go when an underground mine has gaps and fissures?”

Currently, the majority of the world’s nickel is used in the stainless steel industry. Beveridge estimates that batteries make up barely greater than 10% of whole demand, although that steadiness is anticipated to shift quickly within the coming a long time. 

“If we go ahead 10 to 15 years, we’re really trying to a future the place the battery sector might present greater than 50 % of the demand for nickel models by that point.”

However not all nickel is top of the range sufficient to be used in EV batteries — it must be so-called “class one” nickel, with a minimum of 99.8% purity. No nickel is that this pure naturally; all of it must be refined. However the larger the grade of the unique nickel deposit, the simpler and fewer power it takes to course of it.

The location of the proposed Tamarack mine is a high-grade nickel sulfide deposit.

“You realize, a few of our grades we have seen as much as 12 % nickel, which globally may be very excessive. That is a number of the highest grades I’ve ever seen in my profession, ” mentioned Brian Goldner, Chief Exploration and Operations Officer at Talon.

Nickel sulfides are usually discovered deep throughout the earth, and are extracted through underground mines. At present, the U.S. sources most of its nickel sulfides from Canada, Norway, Australia, and Finland, however there are only a few new sulfide mines within the works.

Further nickel might come from laterite, a lower-quality however extra prevalent kind of nickel ore that is discovered close to the earth’s floor and extracted through open-pit mining. Indonesia and the Philippines mine the most laterites, whereas Australia and Brazil even have massive reserves. 

The issue is that upgrading low-grade nickel laterites to be used in EV batteries includes extraordinarily energy-intensive processes, comparable to high pressure acid leaching, wherein laterite ore is heated to a particularly excessive temperature, blended with sulfuric acid, and pressurized. 

“The CO2 footprint could be within the order of about 15 to 20 instances greater than what we are able to do with a deposit like what you’ve got on the Tamarack mission, ” mentioned Henri van Rooyen, CEO of Talon Metals.

That is one cause why many within the EV business consider it is necessary to develop new nickel sulfide mines, significantly within the U.S. and allied nations like Canada, Beveridge says.

“Not solely does it probably deliver provide nearer to an finish person in future, a North American finish person, but it surely additionally offers that finish person the power to say that they’re utilizing a cleaner supply of nickel, which is clearly good for his or her advertising of their product.”

But when home automakers all wish to supply nickel from these much less carbon-intensive mines, Beveridge says that there is simply not sufficient provide proper now to go round. He thinks the federal government might must incentivize automakers to supply nickel from sulfide mines over laterite mines, thereby encouraging extra exploration and mine improvement.

Total although, mining is just one step within the convoluted nickel provide chain. After nickel is mined, it is typically despatched to a different nation to be refined or remodeled into nickel sulfate, and despatched abroad but once more for battery meeting. All of this transport simply provides to the carbon-intensity of the entire course of.

Whereas there are plans for domestic nickel refineries in development, the U.S. at the moment would not have any. So even when Tamarack is operational by its goal date of 2026, that nickel nonetheless would possibly get shipped world wide earlier than ending up in American EVs.

Earlier than the rest, the Tamarack mine must undergo the environmental assessment and allowing course of. And there is no assure that this can be as fast and simple as Talon hopes.

The primary concern with sulfide mining is potential air pollution of the encompassing groundwater and floor water. In Minnesota, lawsuits have kept a different proposed copper-sulfide mine stuck within the environmental assessment and allowing course of for 17 years. Maccabee, who has been a plaintiff in a lot of these lawsuits, says the Tamarack mission poses acquainted worries.

“There are plenty of group conferences and plenty of public relations. However when the group has requested, What’s the proof? The place is your hydrology proof of the place the air pollution would go….? They’ve acquired no info by any means.”

Talon hopes to begin the environmental assessment course of by early subsequent yr, at which level the general public will achieve entry to the data Maccabee needs. However she’s involved that until all the information is launched upfront, regulators and the general public will prematurely assist the mission.

If Talon does face group pushback and delays, that might find yourself voiding its cope with Tesla. The automaker can stroll away from the deal if the mine isn’t up and running by 2026.

Adrian Gardner, Principal Nickel Analyst at Wooden Mackenzie, thinks that is a very bold goal. “It was deal sooner than could be doable, possible in our view, for allowing approval and building.”

However Gardner believes that lithium-ion battery recycling, versus mining, might present a extra fruitful and sustainable provide of nickel anyway. Although this expertise remains to be fairly new, battery recycling firms like Li-Cycle and Redwood Supplies have already entered into partnerships with major automakers.

“There are a minimum of 5 or 6 firms throughout the USA alone, every of whom have their very own proprietary applied sciences,” Gardner says, although he doubts that recycling alone will present all of the nickel wanted. “Will it’s enough to cowl off whole EV demand? I doubt it, however it’s in tandem with the standard applied sciences which might be accessible and used right now.”

At the same time as battery recycling ramps up and will get cheaper, mining for nickel remains to be going to be part of the equation. The Tamarack mission, if it does get permitted, would solely make a small dent within the world nickel scarcity. However the Talon staff hopes that this mission will assist to show that mining will be accomplished in an environmentally accountable method.

“I would like for our groups to have the ability to say that we discovered it. We developed it… Environmentally pleasant, socially accountable metals, ” van Rooyen mentioned, ” And that it is driving our autos and that these metals are going to be recycled into the subsequent battery and the subsequent battery. So I will be lengthy gone and these metals will nonetheless be alive. 

Watch the video to study extra about nickel mining and to see the work happening at Talon Steel’s proposed mine in Tamarack, Minnesota.