The US is hoping that new findings of gargantuan lithium reserves in its mainland will upend the global alternative energy order, in the service of which lithium demand is forecast to reach 1.4 million metric tonnes (mmt) this year.
The battle unfolding so far in the lithium rechargeable battery market is between the US and China. Two years ago, at 6.8 mmt, China had 73.5 percent more lithium than the US. But this was upended by the announcement by the US Geological Survey (USGS) late last year of the Smackover Formation in Arkansas, estimated to hold 5-19 mmt, nine times the global lithium demand until 2030. Then followed the announcement of a deposit of 20-40 mmt in the McDermitt Caldera at the Oregon-Nevada border. A near-simultaneous report came in of 18 mmt beneath the Salton Sea, California’s largest lake.
The maths is daunting and peculiarly imprecise. According to the January 2025 USGS report, “Measured and indicated lithium resources in the US… are 19 million tons.” But, going by just the three finds mentioned, the US has 43-57 mmt (1 American ton = 0.91 metric tonne). Which figure is correct? Meanwhile, the China Geological Survey estimates 44 mmt of lithium in the country across Sichuan, Qinghai, Jiangxi, and the Xinjiang Uygur and Inner Mongolia autonomous regions.
The global demand for lithium is forecast to reach 2.5-3.1 mmt by 2030. Climate projection by the Paris-based International Energy Agency has it that lithium supply will have to power 230 million electric vehicles by 2030. According to the USGS report, “Lithium resources have increased substantially worldwide and total about 115 million tons”.
Between them, the US and China say they have 87-101 mmt—or up to 97 percent more than the world will need even in 2030. So the world is going to be drowning in lithium, but the odds are that lithium will be replaced by a friendlier alternative, hydrogen, before the half-century is out.
Meanwhile, claims about lithium have become as political as mineralogical. Aching to lose its dependency on a lithium supply chain dominated by China—which supplies 80 percent of the world’s cell batteries and nearly 60 percent of its EV batteries—Donald Trump ordered an investigation into potential new tariffs on all US critical minerals imports in April and fast-tracked 10 mining projects, including two on lithium. The same month, the Export-Import Bank—the US government’s official export credit agency—sent a letter of interest worth $900 million to a company to expand a mining project in Nevada, where the only lithium mine in the US has been operating since the 1960s. The $2-billion Thacker Pass project, supported by the US department of energy, is to start operations in McDermitt Caldera in 2026.
The US has a long way to go before it can catch up with China in the ‘Lithium Valley’. An Atlantic Council article partly explained why: “According to a 2021 White House Report, the Chinese government funnelled $100 billion in subsidies, rebates, and tax exemptions to Chinese companies and consumers between 2009 and 2019 to dominate the global lithium refining industry, before global demand for lithium soared.”
Compounding geopolitics is the fact that many countries have lithium reserves, although few so far have the technological wherewithal to mine it. According to the January 2025 USGS report, the largest resources are distributed as follows: Argentina, 23 million tons; Bolivia, 23 million tons; Chile, 11 million tons; Australia, 8.9 million tons; China, 6.8 million tons; Canada, 5.7 million tons; Germany, 4 million tons; Congo, 3 million tons; Mexico, 1.7 million tons; Brazil, 1.3 million tons; Czechia, 1.3 million tons; Mali, 1.2 million tons; Serbia, 1.2 million tons; Peru, 1 million tons; Russia, 1 million tons... .” These are the splinters that the US wants out of its global foot.
Although it has aided few in lithium mining technology, China has looped in countries, especially in Africa and South America, into its global supply chain. What the US intends to do is cut these countries out by building its own internal supply chain for its very own battery-powered products.
The US has a problem that China does not: opposition from human rights organisations and autochthonous communities impacted by the enormous environmental impact of critical mineral mining. In 2023, the People of Red Mountain website exhorted against lithium mining. “The landscapes of the McDermitt Caldera are all significant to Native American Tribes. This is especially true for the Fort McDermitt Paiute, Shoshone, and Bannock. The Caldera holds many first foods, medicines, and hunting grounds for tribal people both past and present. The global search for lithium has become a form of ‘green’ colonialism. The people most connected to the land suffer while those severed from it benefit.”
But expect these humanist concerns to be ignored, because Big Oil is weighing in. In August 2023, Exxon Mobil’s CEO was reported telling analysts that the oil company “can produce lithium ‘at a much lower cost’ than traditional mining”. Chevron has said such efforts “fit within the company’s “core capabilities”. Lithium is found in saltwater deposits and oilfield brine, byproducts of crude extraction. Big Oil sees profit in taking the big leap.
Kajal Basu
Veteran journalist
(Views are personal)
(kajalrbasu@gmail.com)