Show Notes
As more US states and European countries commit themselves to pushing electric cars, the nagging questions about mining become more pressing.
Electric cars need lots of rare-earth minerals. Cobalt, manganese, copper, lithium, nickel, and others are all essential to the production of EVs and the batteries that power them. As demand for EVs grows, so does the need to find, mine, and refine these minerals into service. And this leaves a lot of questions, and a lot of room for America’s adversaries to exploit the demand.
On the latest episode of The Drill Down, co-hosts Peter Schweizer and Eric Eggers talk sense about the problems this creates.
Based on the push for electric vehicles and the demand they create for batteries, and the raw material that goes in them, the World Bank Group estimated that in 2050 “3.5 billion tons of metal” would be needed, the equivalent of “the total production of all metals for all uses in 2020.”
The most aggressive push for converting to EVs in the U.S. is happening in California, where Democratic governor Gavin Newsom just pushed through legislation that will outlaw the sale of gasoline vehicles in the state by 2035. This at a time when the state’s over-extended power grid suffers from brownouts and rationing. As it happens, Eric is joining the show today from Lancaster, California, where he will be making a speech to fans of the podcast.
The “gold rush” for electric battery minerals is worldwide, and so is the backlash. Mining interests are grabbing everything they can, and citizens in many countries are pushing back. Serbia recently had its largest protests since the days of Slobodan Milošević over a proposed mine for European EV batteries. Concerns about mining expansion were a huge election issue in recent elections in Peru, Chile, Ecuador, and Greenland.
Here in the U.S., the push for EVs is about lithium. In the spring of this year, when we had major supply chain issues, president Joe Biden issued an executive order allowing the Secretary of Defense to identify risks in the supply chain of materials such as lithium or cobalt and make policy recommendations to avoid them. He authorized an increase of U.S. supplies of lithium, nickel, and other minerals needed for electric-vehicles batteries and other clean-energy technology.
That made the mining industry happy, but it angered Native Americans. Mining these minerals takes water, and lots of it. In Nevada, a lithium mine called Lithium Americas that operates on federal lands is being protested by a Native American tribe and other locals due to the expected use of billions of gallons of precious ground water, potentially contaminating some of it for the next 300 years. But money talks, and in the first three months of 2021, U.S. lithium miners raised nearly $3.5 million from Wall Street. All this is happening at the same time the Biden administration has banned oil and gas production on federal lands.
In September 2020, Nevada’s governor Steve Sisolak approved $8.5 million in tax abatements for Lithium Americas, which intends to mine tens of thousands of tons of lithium—the key component in electric vehicle batteries—from a site in northern Nevada. Another top Nevada Democrat, Sen. Catherine Cortez Masto, in 2019 met with the company’s executives and two years later persuaded her colleagues on the Hill to scrap legislation that would have imposed costly royalties on Lithium Americas and other hardrock miners.
On paper, Lithium Americas is a Canadian company, but its largest shareholder is a Chinese company. The Chinese mineral giant Ganfeng, which holds a seat on Lithium Americas’s board “may … be in a position to affect the company’s operations and direction,” according to Lithium Americas’s most recent annual report.
Nationally, Biden’s “Inflation Reduction Act” will, among many things, spend $369 billion on so-called “green investments” designed to make things like electric cars more affordable and competitive. Who is overseeing that massive pile of money? None other than John Podesta, someone whose name is very familiar to listeners of The Drill Down. Podesta, who has encouraged Chinese investment in American infrastructure, will oversee the law’s hundreds of billions in climate spending. The Drill Down has previously covered Podesta’s own mining connections, and those of his lobbyist brother, Tony, whose lobbying clients include Chinese companies like Huawei.
So, if you’re following, this means a company owned significantly by the Chinese will likely benefit handsomely from the “green energy” investment money of the Inflation Reduction Act, via the Podesta brothers and other national and state government efforts.
The Government Accountability Institute has seen this before. Our research uncovered the connection between the Bill and Hillary Clinton Foundation and Canadian mining magnate Frank Giustra regarding the sale of a uranium mining company. Also, as Peter says in the show, in our research on the shady business dealings of Hunter Biden, we learned that through his involvement with a Chinese private equity firm, he had a “stake in a mining company that was operating in Africa that was producing cobalt and other critical minerals that also have military applications.”
