Critical Minerals Global Expert Optimistic About Supply


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Late in 2024 I had the privilege of sitting down with one of the world’s leading experts on critical minerals, Gavin Mudd, director of the centre for critical minerals intelligence at the British Geological Survey. The second half of the conversation included a great deal on why we’re both optimistic about having enough critical minerals for the decarbonization transition.

Here’s the podcast and a lightly edited transcript:

Michael Barnard [MB]: Hi, welcome back to Redefining Energy Tech. I’m your host, Michael Barnard. As always, we’re sponsored by TFE Strategy, a firm which assists investment funds and firms to pick the winners and avoid the losers in climate solutions. Returning for the second half of my conversation with Gavin Mudd, the director of Critical Minerals Intelligence center with the British Geological Survey and like me, an optimist about the energy transition. We have enough minerals and we’re not going to run out. But yeah, certainly for the critical, you’ve confirmed for me the critical minerals extraction, the rare earths are everywhere, but we don’t have the people and the knowledge about how to get them out in sufficient quantities. Quantities to be able to move that off. You know, as I said, we lost the plot on some of that stuff.

And I’m sure in, you know, your industry when you were focused on critical minerals, you know, many people you’ve talked to for the past 40 years have been waving their hands at the government saying hello and hearing echoing sounds instead of, oh, Gavin, come on into the Prime Minister’s office. Let’s talk about what’s important, what we should be paying attention to strategically around minerals for the next. Now I’m sure you’re getting a lot more of those invitations.

Gavin Mudd [GM]: Yeah, well, and it’s also part of the reason I came to the UK is I think I can help over here. Really well, so, and I think when you’re looking at it, some of the challenges, I mean, some of the governments are starting to realize, certainly Australia, the realization is dawning that green steel means a radical restructuring of their entire iron ore sector because it favors magnetite type iron ores, not the sort of hematite go site type, you know, ores that are typically produced in Australia. Only a very small fraction of Australian iron ore at the moment is magnetite. I mean it’s a billion tons a year. So even a small fraction of that, still a decent amount.

But for Australia to pivot towards green steel production, and there’s some great reasons why Australia should do that and there’s great capacity and sort of potential there, it means a complete restructuring. That message I think is being realized right the way up. It’s taking a long term view and that’s something that in the west especially, and you know, Australia would be a classic example where that hasn’t been the case where everything’s been much more short term, you know, and especially Australia, there’d be three year election cycles. So that’s, you know, that’s an issue.

MB: Certainly for Australia. They have several big exports which are going to disappear. I stumbled across something when I was looking at an incredibly bad hydrogen study strategy for Australia and I discovered that Australia exports four times as much energy in the form of coal and natural gas as it consumes in its economy. The hydrogen strategy claimed that they were actually going to expand that with more hydrogen exports, which was in the world of cheap solar panels that can be put on any country and cheap wind turbines that can be put in most countries. That was a remarkably unrealistic projection is the way I describe it.

But certainly for iron, I’ve spoken to a person who’s engaged with ARENA in terms of investments, the Australian Renewable Energy Agency, they’re a big investment fund for mostly clean tech. They’ve got some bad stuff and they’ve got some stupid stuff they say about hydrogen too. But I spoke with that gentleman about explicitly how to value green steel manufacturing, reduction of iron through green technologies and how to value that so they can actually make the business case work, you know, because it’s just so cheap to rip it out of the ground, put it on ships and send it to China and then changing that up requires some significant investment. It’s non trivial.

GM: Absolutely. In Australia we’ve been saying for decades that we export the cheap stuff and buy the expensive stuff back and we wonder why we’re still in debt. But when you’re looking at it, Australia would probably get a couple hundred billion worth of iron ore export. Something like that goes up and down. It’s probably come down a bit lately. And if you transform all of that into steel, you’re looking at several hundred. And you could make the same type of calculation for all of our bauxite and alumina exports and we produce a fair bit of aluminium here or in Australia as well. So if you converted all of that aluminium or the bauxite and alumina through to aluminium and called that green aluminium, for example, it’s the same kind of argument. You could be multiples of what we currently export.

Now one of the other, I suppose brutal reality checks at the moment is up until about 10 years ago, lithium was only worth $50 million to Australia in exports. Right. It’s now a few billion and growing rapidly, although price, you know, the current price lows are affecting that, but it’s moved from 50 million to a few billion and that’s only going to grow now. Rare earth exports are probably about a billion and will grow, right? But coal is 50 to $100 million, $100 billion. All right, now when you add up all of the different critical minerals and let’s say we take, let’s take lithium and multiply it by 10, there’s 30 billion. So, you know, half of coal perhaps, then you take rare earth, multiply that by 10, there’s another 10 billion.

You’re still behind coal now adding more cobalt, you know, and you start to go through the numbers. It’s really difficult to replace all of the current value from coal and LNG just with critical mineral exports alone. I think people are realizing that we have to go further downstream now. Australia recently built a lithium refinery in Kwinana in the south industrial side of Perth. That was touted as a, you know, responsible sort of production, but it’s pretty simple. Spodumene concentrate, which is the lithium rich, sort of concentrated, only contains about 6% lithium or lithium oxide, so about, you know, a few percent lithium perhaps.

Now that means that 97% is basically silicate that you’re not going to process or use for anything really. So if you’re shipping that halfway around the world to China, where a lot of the processing or refining capacity for spodumene through to lithium hydroxide exists, you’re paying for a lot of transport of stuff that’s basically just sand, silica. By refining spodumene in Western Australia, you save a lot on the transport, both financially, but especially on the carbon side. Thinking about that has been a really good case study in saying, well, actually if you start factoring in those things, and largely it was built because it was cheaper to actually process locally in Western Australia than it was to actually ship material all halfway around the world. But there are significant carbon savings for that.

I think when you’re looking at the opportunities for Australia going more downstream, you know, into the smelting and refining sides, that’s where Australia can add a lot more significant value. We’re starting to see that the future made in Australia sort of regime that’s sort of being, you know, developed at the moment is largely along those sorts of lines. I’m not as familiar with all of the fine detail of it, but certainly that’s a lot of the thinking behind it is to increase the value add in Australia rather than just exporting cheap concentrates. We’ll see where Australia gets to. But for the UK, we’re going to be dominantly an importing country, so we have to rely on our know how, our manufacturing. There’s some potential. We’ve got some significant lithium deposits, we’ve got a very large tungsten deposit.

There’s potential for exploration in different parts of the UK, including rare earths and other elements. There are some small nickel deposits in Scotland, for example. So there’s potential. But for the most part the UK will certainly be an importing country. And so that means we have to look at our downstream, our midstream and recycling potential, all of these types of things, which of course is very similar for many other countries. So. So I guess it’s a. Interesting space to keep involved in, I guess.

MB: I think it’s a good time to lean into the recyclability. I’ll take the UK example because one of the things I did in the past year was a global projection, a global look at all iron and steel manufacturing processes. And because it’s a huge emissions sector and you know, part of my shtick is that I look at all the big emission sectors and I look at all the solutions, including avoiding and all that stuff. Then I do projections through 2100, incredibly arrogantly, of which ones will win.

It’s a scenario, as I always try to say this, I don’t claim to be right, I just claim to be less wrong than most. Along that line, for example, the International Maritime Organization claims that bulk shipping will grow by 50, you know, by 100% by 2050, whereas 55% of it is in structural decline. 40% of bulk shipping is coal, oil and gas and 15% is raw iron ore.

Back to the UK. The UK right now exports lots of scrap steel and makes new steel in blast furnaces. The UK steel industry, their entire premise is. we’re actually going to start keeping that scrap and put into electric arc furnaces, which is a very reasonable thing for a country to do. This is actually one of the few unequivocal places United States is ahead. For 25 years they’ve been at 70 or 71% of steel supply from scrap.

China is now doing the same thing. They have about 260 to 280 million tons of scrap domestically a year from their economy and they’re pivoting strongly to electric arc furnaces. They’ve stopped permitting blast furnaces and open hearth furnaces powered by coal. This year [2024], zero have been permitted. And so, you know, because they’re at the end of their infrastructure build out. You know, just as the west went through a big infrastructure build out in the 50s through 70s, China has been going through that now. And so now it’s coal demand is going to plummet because metallurgical coal and its energy coal are being heavily displaced.

There are a lot of people who claim that lithium isn’t lithium batteries aren’t being recycled and certainly there are other people who are claiming no, we’re doing really well on everything that enters the recycling stream, getting a lot of it. What are your concerns and the BSG’s concerns regarding recyclability of different critical minerals? What would you say are the important things for people to pay attention to and how much potential, like Michael Leibreich calls recycling of metals one of the green energy transition superpowers. How optimistic or cautious should we be about assertions like that?

GM: I think the first point I’d always make about recycling is it’s complex, it’s not easy when you’re looking at, you know, some specific metals. Lead would be a really easy one. These days it’s pretty much only used in lead acid batteries, which are very easily recyclable, but lead’s toxic. The circular economy in lead has been driven by the fact that it’s regulated heavily and we are required to recycle it. In most developed countries, we’re already at 90 to 95% recycling for lead acid batteries. China’s getting closer to that too. India is actually not far behind either. So when you’re looking at it, there’s some good examples there, but that’s on a technology that’s well understood and it’s very much single use and it’s pretty much stayed the same. Like it hasn’t really changed.

MB: It isn’t blended in alloys and trace amounts. It’s big chunks of lead.

GM: Yep, absolutely. So it’s very, it’s rather direct and straightforward to recycle. Now when you’re looking at lithium based batteries, whether it’s electric vehicles or home electronics or whatever the chemistry is constantly changing. That’s fine, we’re getting different performance or better performance over time and so on. But what that means is that the recycling has to constantly evolve and change as well. Now there are processes out there and there’s certainly some companies that are involved in different aspects of lithium battery recycling and some is just disassembling them and then sending them off to others for specialist processing. But there are certainly companies out there that can do it.

Now part of the problem at the moment, of course, is that the flow of used EV batteries is not that great. We’re still, we’re still building out our EV stocks. So there’s not a lot of batteries out there that are available to actually be recycled for, you know, from lithium based batteries. So, and sometimes that I think gets lasting longer.

MB: They’re lasting longer than anybody expected as well.

GM: Instead of actually recycling we repurpose them, you know, so that’s the other thing we can do as well. So, and all of these things are, you know, they make good sense from a circular economy point of view. We’re getting more out of the particular resource that we put into making the battery in the first place. Once it’s finished, it’s EV life, it becomes a home battery life or other things like that. I think there’s a lot of confusion out there and I think it’s easy for people to think that a circular economy just means recycling. It means putting it in a bin, goes to a factory and out comes a new battery. Nothing is ever that simple.

It’s, and so there’s a lot of complexity and I think one of the problems with, we’re seeing with the rise of lithium ion phosphate batteries is that they’re all cheap materials largely. Cobalt is an expensive metal, nickel is an expensive metal. That means the price of that battery or the value of that battery was certainly much higher. And so that was what made things like those batteries were attractive for recycling in the first place. So now sometimes, as we’ve seen with lead acid batteries, that means that despite some of the, you know, the cost issues there’s a role for regulation, mandating things like recycling or sometimes.

An example I often point to is things like the Fairphone. The Fairphone is the smartphone developed in Belgium and they call it a Fairphone because they automatically have built their phone to include things like right to repair. When the battery fails, you just replace the battery. When the screen fails, you just replace the screen. Fair. They’ve done everything they possibly can to trace where all their materials are coming from. They’ve tried to maximize the recycled content of their material of all of their products as well in all the different parts of their phone. That’s fair. That’s actually, you know, it’s a responsible phone, as you might call it, or, you know, sustainable phone, at least the best that can be developed at the moment. So I think some of those things can be driven by regulation, some are consumer choice.

I think when you’re looking at some of the examples in consumer choice in food products, for example, whether it’s marine stewardship certification, whether it’s in paper and forest stewardship council certification of recycled paper or not, logging, old growth forests, which, you know, BC used to do pretty well, as Australia did, and it’s still going on in many parts of the world, including the Amazon, et cetera. There are ways we can deal with that. I think consumers, and I think this is one thing I’ve always seen is that you give consumers a value proposition, they’ll generally take it, you know, and sometimes even if it does cost a tiny bit more, people say, well, it’s the right thing to do and we’ll often do it. So I think we often underestimate that good capacity of people.

But we’ve got to make that possible, whether that’s through regulation, whether that’s through consumer education, whether that’s through product design, you know, things like the, you know, right to repair and things like that as well. I think overall there’s a lot to recycling and there’s certainly a role for a lot more research and innovation in some of the specific technologies. Because when you’re looking at a smartphone, you know, I could ask you a question. What do you think is the most valuable phone element or metal in a smartphone? Out of the 60 elements in a smartphone, what would be the most valuable?

MB: I just read an entire book about minerals which used the iPhones as an example because it has like a hundred different elements in there and I can’t remember which one was the most shot of. What do you, what is it today?

GM: Gold. Despite all of the other elements, the lithium tantalum and the indium in the screen, last time I checked, which is admittedly some years ago was 70% of the metal value contained in a phone was actually just gold. Because that’s of course very important for a lot of the electronics and the circuits and so on. And so they use a lot of it. A typical, if you go back 20 years, a smartphone used to have between 700 to 900 grams per tonne in it. In a typical smartphone of that era nowadays, the last time I checked a few years ago, it was down to about 250 because of course, as the gold price goes up, it makes it more expensive. So now a typical gold mine would only be about 1 or 2 grams per ton, you know, on average.

MB: You’re describing this, and I was thinking this is a high assay mining ore.

GM: But unlike a gold deposit, which largely only has gold and maybe a bit of silver or possibly copper or something, it’s got 60 and a bunch of rocks. It’s a complex mix of things that we haven’t typically developed the processes to separate back out again. All right? And so, and that’s where we get to some of these policy choices and design choices in things like phones and other products is how much do we design them to facilitate recycling. So that way when it does reach its end of life, it’s much more readily recyclable. How much do we just say it’s just a process issue, you know, just.

And if we look at household garbage, for example, rather than having, say, three separate bins, why not go back to one and just send it off to a big sorting place that actually sorts out the glass, the plastic, and all of the other components of good old household garbage or bad old household garbage, I guess. So sometimes these are design choices about whether we’re looking at the product, whether we’re looking at the system. So there’s always different ways to look at recycling, but it’s a, it’s a wicked problem. It’s a lot of different things to always pull together. And it’s not something that just happens overnight. Whether it’s consumer electronics or whether it’s the energy transition more broadly, things are changing rapidly. A lot of our recycling systems also have to evolve rapidly.

But for some of them, like electric vehicle batteries and even things like solar panels or even wind turbines, we’re now starting to decommission wind turbines that were built in the 1990s. We’ve got time to build out both the infrastructure, evolve our policy and our regulation and all of these types of things. So I think there’s room for some degree of optimism. But we do need to be cautious. It’s a difficult space and it’s certainly one that requires a lot more effort and it’s an important one because it can be an important supply and it can certainly help limit or at least minimize a bit of what we need from primary mining as well. So it’s an important part of the big picture.

MB: And in the west we have the same problem which is we don’t have the human beings. Because if I was to characterize it from what I understand, the people who can refine, can recycle an iPhone are in many cases the same people who are needed to refine ores for the critical minerals in the first place. The processes are different because you don’t end up with this weird gold mix of gold bar and rare earths and stuff like that, the iPhone. You end up with something else. Like Lyle Tritton is a buddy of mine, calls himself the nickel nerd. He’s a Calgary [sic Edmonton] based guy who knows he’s forgotten more about nickel processing than most will ever learn. He works globally getting the metallurgy right for refining nickels and he does that in other metals because he’s just a general purpose engineer at a certain, does that for non metals as well. But that’s one guy I can name.

GM: There is a huge problem in the expertise, the level of expertise we have and it’s something we need to invest in. It’s the, you know, the people side.

MB: I make the comparison for nuclear programs. I say for a nuclear program to work — and I know Australia is going through this, I don’t know which side of it you’re on — but I always say that nuclear requires a national strategic program. One of the things that national programs do is build all the human resources and resources over 40 years. You can’t do that with just a free market, it requires an intentional resources strategy to create the skilled resources. What I’m hearing from you today is that’s very true for critical refining, recycling process as well. We’ve got a big gap in the west in terms of the people and skills. We’ve got to motivate new people to get into those specialties, those STEM courses in universities to create the demand, so that there are programs in the universities and they’re not shutting down. We’re seeing the opposite of what we should see which is mining engineering programs shutting down when they should be opening up.

I’m going to ask a specific question. We’re getting down to the last strokes of the interview and the discussion. But one of the questions I have, of all the critical minerals right now, what are you most concerned about recyclability of?

GM: I probably have equal concern for all of them, really. I think that each of them have different challenges, and it’s hard to say one is, you know, better or worse than others, I think. Some of the challenges are unique. Some critical minerals, you can’t recycle them. They’re used in a dissipative manner. Antimony would be one where it’s used in flame retardants. I don’t think you can recycle things like that once they’ve been used. So. So I think there’s some.

I wouldn’t say I’d have one I have more worries about than the other. They all have different challenges. You know, some markets, like tellurium, for example, are extremely small. So in some sense, why would we worry about that? But then again, we’re going to need a lot more tellurium for things like your cadmium telluride type bar solar panels as they’re growing at its first solar in the US and others. You could go through all of the different elements, and certainly from my experience, I wouldn’t put one above the other. I think they’ve all got different challenges. They all have their unique little stories and opportunities to improve outcomes.

MB: There is the obvious following question, which is for people who, you know, commodities traders. Which particular set of minerals do you see, based on what you’re seeing is the ones that if they’re to go long on because they’re limited supply and limited recyclability, you know, which ones would you say are the ones that kind of meet that intersectional point where we have, you know, lower reserves that are accessible in an inexpensive way and there’s a growing demand for them, obviously. Do you have a short list that you’re concerned about in that regard?

GM: I don’t think I’ve put a short list together in that specific way, but certainly antimony comes to mind because at the moment, and again, some people argue that China’s, you know, has been depleting its antimony resources. I’m not as convinced about that. But antimony is one of the elements I haven’t done a global study on. I’ve certainly done some work in antimony, but I certainly haven’t done a global sort of resource assessment of antimony. Like I’ve done multiple times with things like copper and the platinum group elements and nickel and cobalt and others. So antimony is one that stands out like that because its global supply has more than halved in the last decade. That’s not looking like it’s going to turn around anytime soon.

It’s one of the extremely few elements, if not the only element over the last decade that’s done that, actually. The only other element you could point to is sort of gradually fading out from history would be mercury because we just, we don’t really have any uses for it and it’s toxic and we don’t really want to develop any more uses for it. At the moment, yeah, people are getting out of mercury, but a whole range of other ones, I don’t know, it’s hard to say.

Like, I wouldn’t say I have a short list, but certainly some, you know, ones that have a dissipative use for their components, you know, titanium, for example, it’s one that, you know, I always come to mind because titanium used in pigments, which is used in paper and paints and so on, and it’s used in a mineral form. So about 75 to 80% of titanium globally on an elemental basis is actually used in that way. Now the rest is mostly used for metals, and a lot of that in the aerospace sector. That’s where there is excellent recycling of titanium metal. But we don’t really recover the pigments associated from paper recycling or. We certainly don’t recycle paints very well either. So I think a lot of that use is dissipative and dispersed.

Another mineral would be phosphate. We use that in a very dissipative, dispersed manner. Even when you’re looking at recycling, you know, the phosphorus that comes from a sewage treatment plant, for example, it’s not the same volume that went onto a farming field. I think a lot of the different elements and the different minerals that are often called critical, they often all have their different stories with respect to recycling and the potential for resources.

But I’ve never found a mineral yet that I think we’re really struggling up against resource depletion globally. And I’ve published, I think probably half the periodic table by now in terms of the different studies we’ve done. That’s because geologically we know we’re finding more stuff. We can find new deposits. We still are. Australia, they just discovered a very large platinum deposit just north of Perth. Australia is not known for platinum and it’s a lower grade, but it’s very close to the surface. Very low grades in nickel and cobalt and copper actually. But so we’re still finding new deposits even in regions with historically strong mining regions like Western Australia, and that we could point to examples in copper and others as well. So I think we’re really not challenged from a resource sort of security point of view.

What we are challenged for is the supply through to production and then who controls that supply. A lot of the cobalt production coming out of the Congo, people say, oh, cobalt 60% from the Congo, but a lot of that is actually still Chinese owned. When you’re looking at the nickel space, people say, oh, Indonesia surged to sort of half of world nickel production. A lot of that is Chinese financing, and the same with Australian lithium, a lot of that is Chinese financing. When you’re looking at a lot of it there’s certainly the stories and the issues can vary.

To me the issues are about understanding those supply chains, understanding the different issues in the different critical minerals because they obviously Indonesia, they’re very different to mining nickel there than they would be in Australia or Canada as well, versus say lithium, where you’ve got the age old sort of contention between the salars or the brines that are processed in South America versus the hard rock deposits that are mined and processed in Australia. Then what that means in terms of looking at recycling and things.

But I come back to a point I made earlier. I think at the moment mining is a single commodity. Typically it’s done on a large scale and that means that the price is cheap and we’re not paying often for a lot of the associated environmental costs. When you’re looking at recycling, we kind of have to pay for everything up front. It’s part of the way that sort of system works. So that does tend to make recycling expensive in a relative sense from a financial point of view. But we know recycling is typically much lower environmental impact overall, whether it’s an energy intensity of carbon intensity and so on.

Getting equivalence there, I think is part of the grand challenge in what we’re dealing with both critical minerals, but also a lot of the standard minerals that may not be critical but are still important to a whole bunch of sectors, whether it’s farming or others.

MB: I’d like to lean into just one more topic before we close out and go back to a couple, draw a couple of threads together. Probably the single biggest dissipative use resource we extract are fossil fuels. We burn them, they turn into CO2 and fly ash. Both, you know, really problematic stuff. And you know, that CO2 was a very nice waste product to deal with because it got rid of itself, put itself in bags and floated up into the atmosphere invisibly. It was great from that perspective. Who knew there were problems? Well, you know, we started figuring that out in the 1830s.

But I’d like to go back to Hubbard’s Peak because in the critical mineral space there are some, you know, doomers, people who say there’s no availability. And I understand some of those voices have a history of being peak oil supply people as well. And you know, the example I make there is that in the OPEC oil crisis, after that occurred, Gerald Ford started investing in unconventional oil extraction techniques. And now the United States is actually extracting 50% more oil every year than Saudi Arabia is. That’s coming to an end for a variety of reasons. It’s one of my predictions for next year is a decline there just because of economics, prices and extraction fracked wells and stuff like that. But technical innovation and identification of new resources combined radically increased the supply side of oil.

Now, what I understand when we’re talking about having this talk, one of the things you said was that many people go against a 2008 global study of mineral reserves. And you’ve personally done the reserve studies and found that we have a lot more than we used to. Is it the same story? We find new reserves and our extraction techniques improve. So tell a bit of that story because that’s a really positive piece of what I heard.

GM: I want to make sure we’re understanding the terms here because really important in mining there’s codes, protocols that companies have to follow in many countries around the world. When we say a resource that means something that we’ve geologically drilled up and we’ve found. When we’re finding a mineral deposit, it’s a freak of nature. It’s an enriched body of rock that has a particular commodity in it or element or mineral or a handful. They’re unusual, they’re kind of needles in a haystack. When you’re looking at the petroleum sector, you’re dealing with basin scale systems, right? So much larger systems. That’s part of the real difference is your mineral deposits are much smaller. That’s one important difference there.

But for a resource, it’s been geologically drilled. We know the size, the volume, the grade perhaps and so we can quantify the tons and grade. Now we’re not as sure perhaps whether it’s economic yet. We don’t have the permits to actually develop a mine yet. But when a mining company comes along and they start calling reserves, that means they’ve done all of those additional studies that look at things like the metallurgy, the mine plan. So there’s a detailed mine plan there that’s been costed out the cost of the processing plant, they’ve factored in the cost of energy, the chemicals they use, the labor and everything else.

Your reserves are typically what’s profitable if you develop a mine on reserves and that’s a small fraction or a fraction of your resources, but your reserves are typically five to 10 years, maybe 20 years if you’re lucky. And mining companies don’t worry about drilling up any more and converting those resources reserves because who knows what prices are going to be in five or 10 years and what demand is going to be like and what sort of some of the other competition factors that are there. So when people talk about reserves, they say, oh, there’s only five years left. Well, that’s the way the industry works because that’s what’s profitable now. All right. Now when you look at the long term trends of these things over time and again, you’ve got to think on different scales.

You can look at an individual mine and an individual mine is never going to last forever. Of course not. And there are many mines that have opened, had an initial reserves plan that would last them five years and after 15 years the mines closed because they’ve depleted what’s economic. There are other mines that started off with a five year reserve plan and are still operating 50 years later. Sudbury would be a good example of that as well as Broken Hill in Australia and many gold mines around the world. When we say resources, we mean geologically. We know what’s there? When we say reserves, that’s what’s kind of profitable to mine now. And then we convert over time with more effort, we convert from resources through to reserves and ideally mine production.

Now when you look at that on an individual basis, an individual mine can expand their resources. As you get declining grades, that may mean that a project expands in scale to improve their economic efficiency. And often as you get a declining grade, you get an increasing body of rocks. The amount of rock that contains that metal often goes up much faster than the rate of the declining grade. So it means you’ve got more and more available. And the gold industry is one of the classics for this. Where it used to be up until the 1970s, of course, you had to really mine at least 5 to 10 grams per tonne, otherwise you just wouldn’t be economic. Once we had carbon and pulp technology developed that used cyanide to leach gold out.

And at the same time, in the early 70s, of course, the gold price was discontinued and so basically allowed to roam freely. And the gold price just kept marching up. And the gold price is one of the only elements that’s continually gone up in real terms. And so that meant that all of a sudden the gold price went from $30 an ounce in say 1970, by 1980 hit $300 an ounce. You’ve got a tenfold increase in price. You’ve got new process technology that’s incredibly efficient, doesn’t require fresh water for example, and you could mine something as low as 0.5 grams per tonne. And so all of a sudden, instead of mining a 2 meter vein of say, let’s say 5 or 10 grams per ton, you could mine 100 meters at say 1 gram. And the amount of gold in that is far higher. And so there’s the global gold boom right there.

Now we know this is very similar. Mechanics play out a bit differently, but certainly when you’re looking at the copper space, as you get declining grade, you move to the porphyry systems and they’re very large bodies of rock that you know they have lower grades and say your veins now that you might mine for some types of copper deposits, but it means you’ve got a lot more available. Now when we look at the research over the past century for copper, we know that global resources were estimated at about. And going back a century ago, there wasn’t this distinction between resources versus reserves. So I’m calling it resources because we really hard to say there’s equivalence economically between obviously 1930 and now.

But let’s say they did an assessment of something like 300 million tons globally was what was considered global resources. And that was a very exhaustive study. As part of the International Geological Congress and USGS was involved and many other groups. When we did our first global copper resource assessment based on 2010 data, and this was published in 2013, we found 1.8 billion tonnes of global copper being reported in resources. Now since 1930 we’ve produced the exact number. It’d probably be several hundred million tons of copper or 500 million tons of copper to be about that magnitude thereabouts. Now we did a follow up study on copper, again based on 2015 data. We did a global assessment. Part of it was, yeah, we found more deposits. The sites we hadn’t found data for before, including in places like China and elsewhere.

But also we know that many mines actually increase as they do more exploration. They’ve already invested their capital and so it’s more economic for them to actually spend money in at an operating mine and expand the size of an existing mine than actually greenfield. And so when you compare the 2015 data to the 2010 data, on average, even allowing for some depletion through mining, we’re about 13% more. So we know that based on global data. So we’ve gone from 1.8 billion tons of copper in 2010, and that’s a pretty exhaustive, but not completely exhaustive. There’s some countries like Uzbekistan and others where we know there’s very large deposits, but there’s no public data. So five years later, with more effort and the number of deposits I think increase from 700 to about 1500 or thereabouts. We’ve got to 3.2 billion tons of copper in the same time as we’ve mined about 0.1 billion tons of copper or depleted. So, so effectively we’ve gone from, you know, we’re comparing 1.7 to 3.2. So in that space of time, our efforts were able to double what we know as resources.

Now the other problem with all of this, and this is especially important for critical minerals, is when we talk about reserves, we don’t have equivalence at a global level to be able to compare country to country all the time. The only group geological agency out there globally that does annual assessments of reserves is the U.S. Geological Survey at BGS. Here at the British Geological Survey, we maintain our own independent set of world mineral statistics for production, but we don’t do reserves.

Now when you’re looking at reserves, not all countries have the same systems. And not all countries actually treat reserves with the same discipline in terms of splitting reserves from resources. But for many things, the USGS stopped reporting reserves because it’s really difficult when you’re dealing with a lot of the byproduct elements. You have to mine the zinc first. And most of the time, people don’t worry about the indium. And, yeah, we know there’s cadmium there, but that’s a toxic element. It’s often a penalty element. So if you’re selling a zinc concentrate that’s got too much cadmium in it, you’ll lose money.

For many of the different elements that are byproducts that are dependent on the mining of something else, they’ve been typically very small markets, which means that miners don’t get paid for them or there’s no interest in them because they’re small markets. And one mine can certainly provide a large fraction of. So for a lot of the reserves, estimates for these particular elements, they just don’t exist. The USGS doesn’t do it because it’s far too uncertain, far too difficult. It’s been a real problem. Now, what we’ve been able to do with some wonderful PhD students is going through and saying, well, if we know we’ve got zinc and we’ve got plenty of zinc resources out there, we know we should be able to develop estimates for things like indium, a much better, more objective base and so on.

When you go through that process, the last time USGS estimated Indian reserves globally, they had a value of about 6,000 tons from memory. Now, when we’ve looked at taking the global resource studies and looking at that for things like zinc, you can get estimates up to 300,000 tons of contained indium or more. The bottom estimate is about 50,000 tonnes. So when we’re looking at that and we’re saying, well, that’s resources, so what would that mean in terms of reserves? Well, we know in the. In the last decade alone, since we looked at Indian production has doubled from about 4 or 500 tons a year to almost 1,000 tons a year. And that’s because basically there are many zinc refineries around the world that weren’t bothering to even extract Indian.

And so the ratio between indium extracted per tonne of zinc is still going up. Now, for a lot of other critical minerals, that’s not the case. Cadmium has been declining very gradually. Others are volatile or have plateaued, like rhenium coming from molybdenum, for example. But the fundamental problem is that getting reserves estimates for things that miners don’t get paid for, and if they don’t get paid for it, they can’t really call it a reserve because that’s the strict definition that they have to work towards. So it means that there’s these data gaps, and people confuse a data gap as a supply gap when supply has still been increasing very nicely, thank you very much.

We know for many of these types of elements, whether they’re critical or not, we’re very confident about the primary metals that they’re produced from, that they’re extracted from during smelting and refining. When I look at the problem, and this is based on many papers across, you know, across a lot of the periodic table, we are confident about our primary metals, and we’ve got good data on that at a resource and reserve level. We’ve been doing that more and more. All right, so if we’ve got the primary metal, it therefore stands to reason that we should be confident about the byproduct metals that come from that, whether it’s indium, whether it’s cadmium or tellurium and many others.

We also know that when you’re looking at something like tellurium, for example, at the moment, a lot of that is extracted out of copper smelters and refineries from the anode slimes, for example. But we also used to extract tellurium from gold deposits. Some of the biggest gold deposits in the world also happen to have tellurium, whether it’s Mudantau in Uzbekistan, which also not only is gold, but also tellurium and selenium and probably some other things, if the Uzbekistan government would publish the data. But also the super pit in Kalgoorlie in Western Australia, it’s one of the biggest tellurium deposits globally. Olympic Dam in South Australia, one of the biggest copper deposits, gold deposits, uranium, rare earth deposits, cobalt. It’s got a lot of stuff in it, but it also has tillerium.

All right, so there’s many different sources we could find for some of these things that haven’t really been accounted for in things like our reserve studies or, you know, certainly the work that the USGS does. And they are the only group that does it. And it’s difficult trying to get, you know, apples and oranges to speak to each other, but that’s the job. And they do the best they can. So when we’re thinking about a lot of these sorts of things, I think the point I often make is that a data gap does not equal a resource gap in the ground. A data gap does not mean a supply gap, you know, because we know for a lot of these critical minerals production is continuing to increase for a lot of different reasons.

When I look at the problem I’m actually quite optimistic. I’m not worried about the quantity in the ground. I’m more worried about mapping supply chains and saying well what are the potential for? There’s other sort of suppliers actually if we’re thinking about it. We could go back and look. Sudbury has processed about a billion tonnes of ore. I know that I’ve published that. I pulled the data together. That means a lot of tailings is several hundred million tonnes of tailings and it would be tens and tens of millions of tons of slag. Now there’s going to be all sorts of metals still left in that material, those residues. So we could go back and reprocess those and get more metals out and some of the metals, whether it be tellurium or selenium, that weren’t extracted in the past, so.

So sometimes there may be new types of supplies that certainly USGS reserves data doesn’t even account for. There’s companies out there that are looking at these types of opportunities because they are opportunities to clean up mine sites, get better longer term sort of remediation or rehabilitation outcomes and provide supply whether it’s the primary metals of interest or critical. So that’s the broad brush. Hopefully that helps.

MB: To summarize this, I’d say the minerals doomers are wrong, which I knew coming in. Resources on critical minerals have been going up. The substitutability of minerals is underappreciated and recycling is always lower energy and lower impact. We just have to figure out more stuff with that because of some changes. The concern area remains the dissipative of minerals. You mentioned three antimony, phosphate and titanium. And so you know, those are more concerns where we might have a problem. But you know, from an energy transition perspective, well phosphate is used in agriculture is the dissipate of use. Titanium does get used in some applications but they tend to be places where there is recyclable because it’s not paints.

GM: Titanium is also an expensive metal, which is why it’s quite often recycled and well recycled as a metal because it’s high value.

MB: With that summary I’m just going to say, I always leave my guests an open ended opportunity. They’ve got an audience. I had 50,000 people listen to my podcast last year. They tend to be nerds, they tend to be focused on climate and they tend to be focused on money because I, you know, I do combination assessments. And so, you know, to that audience just an open ended opportunity just to share something that you think is of value, whether it’s something we missed in the discussion or something that is personal to you about how you got to where you are that you think would be of value.

GM: Look for the data. I think one of the things people often sort of always surprised that with a lot of the research work I do. Where did you find that data? Well, companies publish it. I remember years and years ago, people were saying, oh, companies would never release their carbon data. They wouldn’t do that. They’ve been doing it for 15 years. You know, all I’ve done is analyze it and put it all together and, you know, add up all the different companies and mines and try and make sense of actually how it all looks. Right. And largely it’s very similar to life cycle assessment results. You know, it’s. So as grades decline, sure, carbon costs go up, water costs go up, energy costs go up. Of course they do. That’s the nature of mining.

Question is, what do we do about that? I think there’s often data out there and for some things data is missing and it’s hard to get, you know, all right. It sometimes requires an enormous amount of effort to get that data. But I think look for the data, the evidence is out there and I think out of everything that I’ve done in finding that data, it’s convinced me that, yeah, I have an optimistic view now and I never used to do that 15 years ago. I think going through the exercise of finding the data and convincing myself of whether it’s resources reserves, the environmental impacts, how to manage that, and coming from the environmental engineering background, I can see your way clear on the way you would say this is a sustainable mine, this is a responsible supply.

I think the answers are out there. It kind of sounds like Fox Mulder when you say it like that, but they are. And I think there’s good reason to be optimistic. If you think back through history, and I’ve always been a student of history, but we’ve gone through these challenges and come out the other side positively before the whole introduction of electrification, the introduction of vehicles, of flying of all sorts of different things. Mobile phones, you mentioned, you know, copper wire and so on before when, you know, people saying, oh, you couldn’t get any more out of that.

I remember back in the 1990s when I, when the Internet first came along and you’d log in with your modem and it was, you know, 1400, you know, bit rate and just 1400, that’s the bit rate. And within a few years it was up to 56,000. And then within another few years it was up to 1 to 2 million because some genius came along with ADSL technology and said, because people. I said, no, 56,000 was the absolute physical limit of your telecommunications channel. You’ll never ever be able to get it up higher than that. And then literally two or three years later, it’s a 1 to 2 million because ADSL technology got invented and we worked out how to do better. So I thinking about a lot of these technological changes that we’ve been through in the past, we’ve come out the other side.

I think we have a right to be optimistic and we need to be optimistic because certainly solving a climate crisis is not something that’s a question. It’s just a matter of getting on with it and making sure we implement all of the technologies and everything we need to do to make sure we achieve the success we need. So I think I’m optimistic and I’m optimistic because I’ve gone through the exercise myself of building the data and working with different PhD students over the years and collaborating globally with a whole range of people, including Tom Gradle at Yale and so on. So I think, and that has taught me that, yeah, getting the data and actually there’s, we’ve got a right to be optimistic. I think we’ll, we’re on the right track and where the trends we’re seeing now are accelerating fantastically.

I think we’ve got a lot of work to do, but I think the trajectory is there. So I think that’s, yeah, that’s the way I like to look at things.

MB: Excellent. This is Redefining Energy Tech. I’m your host, Michael Barnard. My guest today has been Gavin Mudd. He’s the director of the Critical Minerals Intelligence center at the British Geological Survey and he and I are optimistic that we’ll have enough critical minerals for the transition. Gavin, thank you so much for your time today.

GM: It’s been an absolute pleasure. Thank you for having me.



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