Mexico eyes state monopoly to tap lithium rush

Mexico plans to move towards a state monopoly in the exploration and mining of lithium, a vital material in the production of electric car batteries, the government said Friday.

The proposal is included in a constitutional reform bill submitted by President Andrés Manuel López Obrador to the lower house of Congress.

If approved, future concessions to extract minerals considered strategic, such as lithium, will not be awarded to private firms, Mexico’s Interior Minister Adan López told reporters.

"The state will control the exploration and production of these minerals," he said.

Eight concessions already granted for lithium exploration would remain valid as long as the companies make the necessary progress towards starting production, the government said.

Lithium is mined mostly in Australia and South America, while China dominates the supply chain.

Mexico's deposits of the metal are mainly found in the northern state of Sonora, where drug-traffickers and other organised crime gangs operate.

The British-based Faraday Institution, which specialises in researching electric batteries, has called the scramble for lithium and other metals used to make them a 21st century "gold rush."

Although Mexico has not set a date for banning sales of new gasoline and diesel cars, it is home to assembly plants for major brands including Ford, General Motors and Audi.

– AFP