Lithium will continue to play a key role in the future of battery technology and in the broader energy transition, despite significant market uncertainties, according to Australian miner IGO MD Ivan Vella.
Speaking at the Diggers and Dealers conference in Kalgoorlie this week, Vella acknowledged the prevailing uncertainty in the electric vehicle (EV) market. “If you read the media and follow the EV story, it is clear that no one knows for sure where we are headed,” he remarked.
However, the mining executive praised the advances in EV technology, highlighting that these vehicles were not only cheaper to maintain, but also superior in terms of total cost of ownership and technological integration, compared with internal combustion engine vehicles.
Focusing on where lithium fits into the battery story, Vella emphasised the mineral’s irreplaceable role. “Lithium is too big to fail,” he stated, highlighting the investment in research and development (R&D) efforts that have gone into lithium. While lithium might not be the sole material used in future batteries, it would remain a significant part of the equation.
Vella also addressed China’s dominant position in the battery and EV markets, attributing it to the country’s substantial investment in R&D. He cited BYD as a prime example, a company with about 48 000 patents developed in less than 20 years. This level of investment and innovation, he suggested, is positioning China to extend its influence globally.
Despite these advances, Vella acknowledged the challenges ahead, particularly those related to range anxiety and the need for substantial shifts in investment and consumer behaviour.
Vella also pointed out that China has already built or committed to battery production capacity that is double its domestic requirement by 2030, while Western commitments remain uncertain. This disparity, he warned, would lead to intense competition and significant pressure throughout the value chain. Companies will need to think strategically about their position on the cost curve and their overall competitiveness.
Meanwhile, Vella noted that the rapid growth in demand for lithium and batteries would inevitably lead to fluctuations in supply and demand dynamics. “We need to build businesses that are resilient and can withstand these imbalances and the resulting price volatility.”
Turning to nickel, he described the market as “tough”, particularly with the competitive pressure from Indonesian laterite. IGO’s approach to nickel, therefore, is to be more focused. “We are refocusing our exploration portfolio to be very surgical around nickel, ensuring that our efforts are economically viable,” he said.
IGO plans to transition its Forestania nickel/cobalt mine to care-and-maintenance, while continuing to maximise the performance of its Nova operation. “We need to build businesses that can withstand imbalances and volatility in prices.”
The Greenbushes lithium mine is seen as the cornerstone of IGO’s future growth.