The beginning of the end of Europe’s reliance on China for precious rare earth materials may lie buried deep in the rugged reaches of northern Sweden, far above the Arctic Circle.
Swedish iron ore miner LKAB said on Thursday it had identified “significant deposits” in Lapland of rare earth elements that are essential for the manufacture of smartphones, electric vehicles and wind turbines.
The state-owned company that mines iron ore in Kiruna, nearly 1,000 kilometers north of Stockholm, said there are more than 1 million tons of rare earth oxides.
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According to LKAB, it is the largest known deposit of its kind in Europe. But the company warned that it could be at least a decade before mining begins.
Swedish Industry Minister Ebba Busch called Sweden “a gold mine” after the discovery. His announcement came as the European Union’s executive, the European Commission, puts the finishing touches on a proposal for its Critical Raw Materials Law that should help develop reliable and robust supply chains.
Rare earths now make their way into almost everyone’s life on the planet, showing up on everything from hard drives to elevators and trains. They are especially vital to the fast-growing field of green energy, powering wind turbines and electric car engines.
Near Kiruna, Sweden, a deposit estimated to hold more than a million tons of rare earth materials has been discovered. Reindeer herder Niila Inga walks on the snow as the sun sets near Kiruna, Sweden, on November 27, 2019.
(AP Photo/Malin Moberg)
But the EU lags far behind its competitors in the market, sourcing around 98% of its rare earth minerals from China, and none of it is mined in Europe.
And according to the European Commission, the demand will increase fivefold by 2030 due to the digital and green transition of the bloc’s economy.
Internal Market Commissioner Thierry Breton has warned that the EU’s ambition to become the first climate-neutral continent is at risk without secure and sustainable access to raw materials.
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“Our twin green and digital transition will live or die through how our supply chains work,” he said. “Take China for example, with its near monopoly on rare earths and permanent magnets and prices rising 50-90% in the last year alone. The supply of raw materials has become a real geopolitical tool.”
The EU is also eager to learn from the past and reduce unilateral dependencies like the one it developed with Russia for oil and gas, only recently starting to cut ties after the war in Ukraine began with the full-scale invasion of Moscow on February 24. .
“This must change,” Busch said, as European commissioners traveled to Kiruna to mark the start of Sweden’s six-month rotating presidency of the EU. “In the short term, we need to diversify our trade, but in the long term we cannot rely solely on trade agreements. Electrification, EU self-sufficiency and independence from Russia and China will start at the mine.”
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LKAB, which also develops carbon-free iron ore projects, said the rare earth deposits were found near the world’s largest underground iron ore mine operating in Kiruna. Exploration won’t start for years, even if permits are handed out very quickly.
“If we look at how other permitting processes have worked within our industry, it will take at least 10-15 years before we can start extracting and delivering raw materials to the market,” LKAB chief executive Jan Moström said. “We must change the permitting processes to ensure greater extraction of this type of raw material in Europe.”
