Williams letter: Lithium mining

The Dec. 22 Depth reprint on lithium mining in Argentina and Chile leaving indigenous people poor leaves out salient background. In the ’90s, I was in-house counsel to what is now the world’s largest mining company, BHP-Billiton. In my experience, foreign governments collect royalties, taxes and import-export fees from miners, generally totaling 25 to 40 percent of revenue. So why aren’t Argentina and Chile returning some of those proceeds to the local communities? I suspect corruption is the prime reason. Rather than confront that reality, perception pressure is being applied by advocacy groups to the ultimate buyer of the lithium, such as Apple and Toyota, in the hope that it will cause better local practices at the source. That might work with some metals, but not likely with lithium. The source deposits are so few in number that very little competition exists. Lithium, cobalt and rare earths are the fundamental components of modern batteries and none are significantly sourced in the U.S., Canada or Australia where financial and environmental legal regimes exist to prevent local abuses. If U.S. policy encouraged strategic mineral development, we could develop some alternative sources here creating competitive pressure for better behavior elsewhere.

This story was originally published January 12, 2017 at 4:02 PM with the headline "Williams letter: Lithium mining."