Back in the 70s, there was talk of “”peak oil””, then we had ‘”peak oil”” again and again.
Now we have moved on and many in the market are starting to worry about “”peak lithium””.
According to analysts, people are worried that there will not be enough lithium on the planet to keep up with the demand for electric vehicle production. They are pointing to a surge in mega factories and sales forecasts coming out of China as evidence a spike in lithium demand is imminent.
However, according to respected Energy Analyst Michael Lynch there is nothing to worry about.
People seem to ignore the fact that both extraction and production technologies evolve over time.
This is why Reserves of minerals tend to increase over time: because extraction technology is constantly improving. And Resources— at some point in the future: become reserves, which can be extracted with current technology.
Lynch noted the fact that lithium reserve estimates have not been growing more rapidly is that there is abundant supply of cheap extractable reserves in the Lithium Triangle, so there is no need to explore for more yet.
Basically, there is nothing new under the sun. Whether it’s oil, iron ore, or lithium, the basic strategy that any business would follow is to extract the cheap reserves first and then move on to the more expensive ones if demand supports such a move.
Indeed, a temporary tightness in lithium supply in the near future is a possibility, Lynch goes on to say, but this would more likely be a result of available production capacity combined with booming demand than irreversible depletion of reserves.
Peak lithium is not happening any time soon.