This proverb from the first industrial revolution is highly appropriate in relation to global mining operations of the 21st century and, in particular, to the exploitation of the immensely valuable deposit of lithium in Portugal.

It was in May 2018 that the mining industry was startled to find that the Tianqi Lithium Corporation of China had acquired a 24% shareholding in a Chilean producer of Lithium for a value of just over USD 4 billion. This was followed by a

stream of twenty major international deals in which the leading players were China (10) and Australia (5). The buying frenzy was most acute in 2021/22 when a total investment of USD 12 billion led to worldwide rejoicing by politicians, lawyers and top civil servants who held the keys to the tolls on the economic development highways which must be paid before production may commence.

But in 2023 a more sagacious view was taken of market prospects and the finance needed to obtain a balance between supply and demand in the non-ferrous metal markets. Gold budgets slipped by 16% which equalled the growth in the green metals – lithium, copper and nickel – until late October when China Mineral Resources announced that 132 new mineral fields had been found in their country during 2022 and would come on-stream by 2025.

This news was immediately linked to the U.S. policy of “decoupling” whereby it sought to create a bloc consisting of countries such as Australia and Canada to oppose the Chinese supremacy by creating alternative supply lines which could fuel its foreseeable production needs. Such a political intervention in a free market inevitably resulted in a flight of capital, stability and confidence. By early December the spot price of lithium carbonate crashed and reached a two year low of USD 17,400 a metric ton.

Now, in the first month of 2024 these uncertainties have been exacerbated by the proud announcement by the Xinhau News Agency that a mine with nearly one million tons of pegmatite lithium reserves has been discovered at Yajiang in the southwest Sichuan Province. If this is correct, then China (already the world´s richest possessor of rare earth metals) is well on the way to being self-sufficient in materials to drive its principle exports of electric vehicles, batteries, solar panels, computing and telecommunications equipment in the “new energy sector” which is estimated to have a potential yearly export value of USD 150 billion.

These recent developments will obviously have a serious but not necessarily detrimental effect upon Portugal´s ambition to expand its existing strong position as a leading supplier of non-carbonate lithium and copper to the EU metal markets. However, the extent to which this Chinese investment participation will be involved is uncertain. Proposals for a large refinery located at Sines may certainly be modified if not abandoned by selling contractual positions to start-up companies of which at least a thousand have been recently registered in off-shore locations – some with the irresponsible aim of making quick money by gambling in a dirty work place!

Our new government to be elected in March will need to review current contracts and licences most carefully to ensure that our nation benefits environmentally and financially from the exploitation of its valuable but finite lithium resource.