Panel, Conference Presentation
Critical Minerals: Mining the Future Economy | Milken Institute Global Conference 2024
- Critical minerals are projected to become significantly more vital for the energy transition, with net zero targets requiring 40 to 50 times current copper supply levels.
- Meeting future material demands is contingent on improved manufacturing, recycling, supply chain approaches, and a cessation of the investment drought that has lasted nearly a decade.
- New mining projects face development timelines of 7 to 14 years, while Tier 1 assets typically have expiration durations of 15 to 20 years, yet fewer of these assets are currently being developed.
- Electric vehicle adoption targets include 35% to 50% of new US car sales by 2030, a 75% target for 2035, and 100% for the EU, with EVs utilizing six times the copper of internal combustion vehicles.
- Lithium production must scale from 1 million to 4 million tonnes annually, with usage intensity relative to 2020 expected to rise almost 42 times by 2040, accounting for 90% of lithium consumption.
- By 2040, graphite, cobalt, nickel, and rare earth material usage intensities are projected to increase 25, 21, 19, and 7 times respectively compared to 2020 levels.
- Artificial intelligence power demand is forecast to increase 212 times between 2023 and 2028 and could reach 400 times current levels by 2029–2030, necessitating significant increases in power generation and transmission requiring additional copper.
- Infrastructure requirements include a 20% growth in offshore wind and a 29% or more expansion in grid infrastructure, with offshore turbines requiring 16 times more metals than gas turbines.
- Saudi Arabia plans to invest $266 billion over the next five to six years in clean energy and grid infrastructure, aims to become a high-tech manufacturing hub, and is exploring 48,000 square kilometers for rare earth and copper extraction.
- Direct Lithium Extraction technology is currently being developed and is expected to evolve over the next five years, while deep sea and asteroid mining are characterized as 20-year journeys or distant prospects.
- Risks include a lack of investment urgency, supply chain concentration vulnerabilities to unforeseen events like natural disasters, potential AI development stagnation without friendly nation investment, and the dominance of China-owned exchanges in setting prices.
- Regulatory frameworks are deemed critical for establishing consumer understanding of material origins, and private capital must adopt longer time horizons to align with the extended development cycles of mines and battery manufacturing.