Keen to set up shop on top of Portugal’s natural lithium resources, the management of Australian mining company Dakota Minerals wants to invest up to €370 million in an industrial facility in Tras os Montes to supply businesses across Europe.
The company is selling assets in Australia to enable it to focus on northern Portugal as a growing market for lithium is predicted due to the rise in popularity of electric cars whose manufacturers needs lithium for the vehicle battery packs.
Dakota Minerals plans to invest between $200 million and $400 million by 2019 to create a variety of lithium compounds used in the manufacture of batteries.
The objective, said the mining company boss, David Frances, is to concentrate in Montalegre, Vila Real, not only the extraction of lithium but to process the ore in a dedicated factory.
Unlike in Australia, where currently lithium ore is sent to China for processing, in Portugal the objective is to process lithium on site using hydroelectric power and then ship by road to battery factories across Europe.
"Using products from Portugal that help the rest of Europe to become sustainable is something that Portugal should be proud of, as well as creating jobs and wealth," said Frances.
When up and running, the industrial facility will produce lithium hydroxide and lithium carbonate and is expected to employ 200 people.
"Portugal was the obvious place to go. It's hard to find better," said the businessman.
The mining company has been surveying the area and will get the results from rock samples in April. Frances expects the data to reveal a 10-year operating life in the Cepeda concession area which Dakota now controls.
Dakota reckons that Portugal is one of the ten most promising countries for lithium reserves, but because Cepeda already has been extracting the mineral for use in the ceramic and pharmaceutical industries, "It was the obvious place to get into and Portugal is amazing in terms of infrastructure and renewable energy.
The CEO of Dakota recognizes that 2019 is an aggressive deadline and so is moving to Portugal to personally handle the licensing processes and make contacts with the international supply chain.
The financing of the plant is flexible with trade partners and Portuguese investors welcome to participate.
The use of European Community funds also in a possibility: "This project will not be difficult to finance," claims Frances.
As for Tesla, if there is a lithium processing facility in Portugal, this makes it more likely that the US company will locate in the country.
"Anyone who wants to make a 'gigafactory' in Portugal will have the raw material right here," said the Dakota CEO, who predicts that the German automotive sector will outstrip Tesla within ten years as more and more mainstream companies manufacture electric cars.
Dakota is looking at the car market but also in well aware of the growing demand for storage batteries used in domestic photo-voltaic systems, "this will probably be a more important phenomenon than the electrification of cars."
