LITHIUM RESERVES OF J&K
The Ministry of Mines was forced to scrap the auction for the lithium block in Jammu and Kashmir’s (J&K’s) Reasi district for the second time, following weak investor response.
This comes nearly 18 months after then Mines Secretary Vivek Bharadwaj announced the discovery of an inferred deposit of 5.9 million tonnes of lithium ore, pitched as among the largest deposits in the world, in Reasi last February.
WHY WERE THE AUCTIONS SCRAPPED?
ROUND 1:
The first auction was annulled on March 13 after less than the required minimum of three bidders cleared the first round.
The very next day, the Mines Ministry put the block for auction again.
ROUND 2:
This too was annulled last week, after failing to clear the first round despite the minimum bidder requirement being waved off this time around, as per auction rules. The second attempt saw no qualified bidders at all.
WHY HAVE THE INVESTORS KEPT DISTANCE?
- Difficulties around extracting and processing lithium from hard rock pegmatite deposits — like the ones found in Reasi.
- Underdeveloped mineral reporting standards used in tender documents played a significant role in deterring investors.
- No beneficiation study had been conducted to assess the feasibility of extracting and processing lithium from the resources identified in J&K.
- Limited information of the block.
- The block being too small “to apply modern mineral systems-based tools”.
WHAT CAN BE EXPECTED NEXT?
- In case the government decides to move ahead with further exploration of the Reasi block, before another auction attempt, new findings may provide more clarity to potential investors on the nature of resource present, which at present is only “inferred”.
- Alternatively, the government can choose to skip the auction process and reserve the area for the undertaking of prospecting or mining operations through a government-owned company, as allowed under the Mines and Minerals (Development and Regulation) (MMDR) Act.
- This is the first time critical mineral block was put to auction.
STATUS OF OTHER LITHIUM DEPOSITS IN INDIA
- Last month, the Mines Ministry successfully auctioned off India’s first lithium block in Chhattisgarh’s Korba district.
- Also in Korba, just south of this auctioned off lithium block, a private exploration company funded by the National Mineral Exploration Trust (NMET) has found hard rock lithium deposits ranging from 168 to 295 parts per million (ppm). Further exploration could yield an even larger reserve estimate.
- Lithium reserves, larger than J&K, have been found in Rajasthan too.
- Lithium exploration in other states, however, has not been as fruitful:
- In Manipur, efforts to explore lithium in Kamjong district were stalled due to resistance from locals in the area. “The committee decided to drop the item for the time being due to local issues,”
- In Ladakh’s Merak block, very close to the border between India and China, a lithium exploration funded by NMET yielded “results (that) are not encouraging”.
GLOBAL LITHIUM RESERVES (NOW)
SIGNIFICANCE OF LITHIUM
- Used as an important input in Electronics & Telecommunications equipments.
- Used in manufacturing batteries which will become very important for EVs.
- As part of efforts to decarbonise the transport sector – Government of India aims to grow EV sales in India to capture the markets of 30 percent of private passenger cars, 70 percent of commercial vehicles, and 80 percent of two and three-wheelers by 2030.
- Experts say the discovery could lead to not only a reduction in India’s dependence on foreign countries but also bring down the cost of such batteries in the future.
- The cost of a battery is around 45-50 per cent in an EV.
- This will put India on track to reaching its goal of net zero emissions by 2070.
- This will also help reduce India’s dependence on China — “a major concern for many in the current political climate”.
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