Since my post at the beginning of the Ukraine war had a similar context and was moderated, I would now like to expressly point out that the thread is called 'Lithium related media articles' and that the main topic here is the importance of
In the West, the war is often seen as a losing proposition for Russia. That is not the Russian perspective. This war is about raw materials. And about the future: Russia can steal more from Ukraine than it would lose in peace.
It remains a mystery why the West does not recognize Russia's economic and material interests as a decisive reason for war. Before discussing alleged or actual Russian security interests, one should first look at Russia's economic profit and loss accounts in order to understand what is being secured.
Russia's economic losses due to the war and Western sanctions are fairly well known. According to US Vice President Kamala Harris, they are expected to amount to around $1.3 trillion by 2025. The direct financial costs of carrying out the "special operation" are currently estimated at around $250 billion. Although these losses were not planned for, Russia's gains are currently much higher, albeit only provisional.
Bloody battles for "white gold"
In front-line reports, particularly from Donbass, one sees devastated forests and destroyed villages, but not the treasures in the ground. Yet these are often the reason for the battles. For example, the Russians have been trying for more than two years to capture the small Ukrainian town of Kurakhove, where lithium worth hundreds of billions of dollars is located in the Shevchenko deposit.
Confident of victory, the occupiers in Donetsk sent "permit documents" for lithium mining in the region to Moscow, to the Ministry of Natural Resources and Ecology of the Russian Federation, on January 10, 2024.
The Ukrainian government had granted the Australian company European Lithium the mining rights for this deposit a few weeks before the start of the Russian invasion in December 2021. The application from the Chinese company Chengxin Lithium was rejected at the time. The Australian development company claims to be "the first supplier of battery-grade lithium in a fully integrated European battery supply chain". In the summer of 2023, European Lithium CEO Tony Sage announced that the company no longer had any claim to the Shevchenkovskoye field - it was too close to the front.
Without lithium we have a problem
Lithium is described as the material "from which the future is made", as "white gold" and "oil of the 21st century". It is a superlative metal, the lightest in the periodic table, with the highest electrochemical potential and the highest specific heat capacity of solids. Lithium-ion technology is intended to bring about the energy transition and electromobility.
In a speech at the end of March 2024, EU Commission President Ursula von der Leyen warned of the Europeans' heavy dependence on the People's Republic of China for lithium, with 97 percent being imported from there. "Batteries that power our electric cars will increase the demand for lithium 17-fold by 2050," said von der Leyen. If China limits the export of lithium, "then we really have a problem," warned Economics Minister Robert Habeck in July 2023.
With the help of Ukrainian lithium, the European Union could significantly reduce its dependence on Chinese suppliers, because according to the National Association of Raw Materials Producers in Ukraine (NEIAU), one third of the explored lithium deposits in Europe are in Ukraine. China can therefore have no economic interest in Ukraine's complete economic integration into the West and in guaranteeing Ukraine's territorial integrity. This should be kept in mind by "negotiation advocates" in the West who see China as a potential mediator between the warring parties.
Russia's spoils of war
A study by the Canadian think tank SecDev concludes that Russia controls energy resources, metals and minerals worth at least $12.4 trillion in the occupied territories of Ukraine, including 41 coal fields (63 percent of Ukraine's coal reserves), 27 natural gas fields, nine oil fields, six iron ore deposits, two titanium ore deposits, one strontium and one uranium deposit, one gold deposit and a large limestone quarry. The total value of Ukraine's national raw material stocks is estimated at over $26 trillion.
Russian Major General Vladimir Ovchinsky, a former head of Russian Interpol, also referred to this assessment by the Canadians in his article "Lithium and Death" in August 2022. In a typically Russian reversal of blame, General Ovchinsky claimed that now "the time has come for American wars over 'white gold'". Only Russia's intervention had "prevented the direct seizure of lithium deposits".
The Russian writer Eduard Topol, who lives in exile, commented on this by saying that it was now clear why Putin had invaded Ukraine: the "special military operation" was in fact a "special operation to seize Ukrainian lithium". Putin wanted to hit Europe with this: if Europe reduces its consumption of oil, it must be put in a stranglehold with lithium, Topol described Putin's position.
Russia can steal more in war than it would lose in peace
A few months before the start of the Russian invasion, the EU and Ukraine had signed a "Green Deal", an almost revolutionary transformation program for Ukraine. The Ukrainian economy was the most energy-intensive in the world, with the most inefficient and expensive thermal power generation. Now the country was to achieve climate neutrality by 2060. The EU wanted to establish a raw materials and energy alliance with Kyiv, because Ukraine's enormous potential and geographical proximity make it a natural partner for the other Europeans.
"Ukraine not only has huge areas for the expansion of wind energy and great potential for photovoltaic systems, it also has a special advantage: the infrastructure to transport green hydrogen to Germany and thus to the EU," explained Andreas Kuhlmann, head of the German Energy Agency (Dena). 22 of 30 strategically important raw materials, the supply of which is classified as critical by the EU, can be extracted in large quantities in Ukraine, including titanium, magnesium, iron ore, kaolin, manganese, zirconium, graphite and many others.
But Europe's climate goals and "green" Ukrainian energy pose existential threats to Russia's business and livelihood model, the sale of fossil fuels. Economically speaking, the war is definitely worth it for Russia if it achieves its war goals. Because through wars, Russia can steal and gain much more than it would lose in peace.
An interesting report on the terrible Russian war against Ukraine, in which hundreds of thousands of lives on both sides are being sacrificed.
The real motives of this war are imo not to militarily conquer the whole of Europe, but rather the huge mineral resources of the Ukraine, especially in the Donbass.
Alongside other important raw materials, it is primarily about the new oil, the white oil, lithium!
Imo Russia and China have recognised this and are positioning themselves together against the western world.
Just as oil had a major influence on the last century and resulted in many wars, the age of the electrified world has now begun.
The china dependency of the western world, especially Europe, has now reached dimensions that are becoming increasingly irreversible.
The energy crisis and inflation of recent years are a clear indicator of this.
The artificially low prices of lithium and other rare earths are also intended to prevent/contain exploration due to inefficiency.
India has a key role to play here, which GR has probably recognised.
Consistent punitive tariffs on state-subsidised Chinese e-cars, which also do not meet any ESG criteria, are the order of the day.
At the same time, the Chinese should stop dictating the price of raw materials.
Imo the longer we wait, the more unstoppable the strategy of these dictatorial superpowers will be.
Imo LTR is very lucky to have (almost) completed KV just in time and must be protected and supported with all our might in view of this geopolitical situation. Imo LTR's independence from China was and is a brilliant move by our management and must be rewarded accordingly!
(20min delay)