Lithium reserves found in J&K put on the bidding block
Lithium reserves found in J&K put on the bidding block
Union Mines Secretary Vivek Bharadwaj said on the sidelines of the launch of the Federation of Indian Chambers of Commerce and Industry (Ficci) report on ‘New-Age Energy Minerals’ on Tuesday that the central government expects to complete the auction of the 5.9-million tonne (mt) lithium reserves discovered in the Reasi district of the northern Union Territory (UT) of Jammu & Kashmir (J&K) by the end of this calendar year.
“Auction will be over by the end of this year,” said Bharadwaj, adding, “We have already recommended a transaction advisor to the J&K government for the auction of lithium reserves.”
The specific timing for a sale, however, will be determined by J&K authorities, Union mining minister Pralhad Joshi stated in Parliament last month. Asked when the transaction advisor would be selected, Bhardwaj said, “J&K authorities have to take a call on the appointment of the transaction advisor.”
Apart from lithium, the government is also looking into sapphire in the region, according to the secretary. The Geological Survey of India discovered lithium in the UT in February of this year.
The nonferrous metal is classified as a vital earth resource and was previously unavailable in India.
Lithium is needed to power India’s energy transformation goal since it is a critical component in the production of lithium-ion (Li-ion) batteries used in electric vehicles (EVs) and battery storage. It will assist the government in realising its ambitious aim of 30% EV adoption for private automobiles, 70% for commercial vehicles, and 80% for two- and three-wheelers by 2030.
Apart from its use in EVs, lithium is also crucial for harnessing solar and wind energy, both of which are critical components of India’s efforts to transition to a low-carbon growth path in the quest for carbon neutrality (net-zero emission objective) by 2070.
According to commerce ministry data, India imported Li-ion worth Rs 8,811 crore, with more than 95 per cent of it coming from Hong Kong and China. Only 26 mt of the 98 mt of lithium resources were classified as reserves (ready for use) globally.
According to Ficci’s New-Age Energy Minerals report, 70% of these 26 million tonnes of reserves are in Chile (36%), Australia (24%), and Argentina (10%). Apart from J&K, the only other place where lithium reserves have been discovered is in the Marlagalla area of Mandya district in Karnataka.
Limited subsurface exploration by the Atomic Minerals Directorate for Exploration and Research has revealed the presence of lithium resources in Karnataka totalling 1,600 tonnes (inferred category).
The auction will also aid in the resolution of India’s refining industry crisis. India currently lacks a lithium refining unit. The winning bidder will also be required to establish a local processing plant. China owns roughly 75% of the world’s lithium refining capacity.
To realise the sector’s full potential, Bharadwaj emphasised the importance of opening the sector to private players, encouraging domestic exploration, and implementing efficient technologies.
He also addressed the challenges confronting the offshore mining industry, noting that the government is taking decisive steps to amend the Offshore Areas Mineral (Development and Regulation) Act of 2002. “I think the government is in the process of amending the Offshore Areas Act that was put in the public domain for consultation. “ The consultations are now over, and it will be shortly debated in Parliament,” he added.
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