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Western Australia, the Saudi Arabia of lithium, currently producing half the world's lithium and more coming on line.

Albermarle are building a LiOH plant in WA that will add 33% capacity to current world production on it's own, plus the Tianqi plant adding maybe 15% is half finished construction right now.

We are the also the Saudi Arabia of gas/LNG, plus as a state produce a metric fuckton of the worlds gold and iron ore, but a pity our state and federal governments practically give all our minerals away for trivial royalties and tax the sheeple to the hilt on personal tax...

(plus we have a homeless and public mental health problems due to "lack of funding"" in one of the richest mineral states in the world with only 2.6 million people in an area almost size of Western Europe).

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Maybe Australia should follow Norway sovereign fund idea:

"I don't think anyone expected the fund to ever reach $1 trillion when the first transfer of oil revenue was made in May 1996."

From: https://money.cnn.com/2017/09/19/investing/norway-pension-fu...

In theory every country rich in natural resources should follow Norway's example but in practice the presence of natural resources tends to exert a strong corrupting influence on both the economy and the political system:

https://en.wikipedia.org/wiki/Resource_curse

Norway only dodged this because we had a supremely visionary Iraqi visit the authorities, and managed to convince them of this danger while the industrial influence was still small enough for government to manage. It's a remarkably lucky coincidence.

Planet Money made an episode about this http://www.podcasts.com/npr_planet_money_podcast/episode/301...

Thanks!

Is there a source of information you could point me to that explains more of this story?

See my link to a sibling comment of yours

Do you have any resources about this? It sounds like a fascinating story.

Farouk al-Kasim. It's a fascinating story, glad I found this in webarchive as it's now behind a paywall.

http://web.archive.org/web/20100123225932/http://www.ft.com/...

I really enjoyed the story... but find myself wondering what was the specific “magic” that made it work.

Nowadays everything is “setup” for the cooperation of public and private, but what are the key “ingredients” to make it happen?

The fact that this worked out, is it something unique to that situation, or cannot be duplicated?

The part I find most enticing is this idea of the government shouldering 50% of the risk, and industry only having to do 15%. If anyone could expand on this, I would appreciate it.

> Nowadays everything is “setup” for the cooperation of public and private, but what are the key “ingredients” to make it happen?

Norweigans trust their government, corruption is low, there's strong institutions already in place (a point specifically mentioned by al-Kasim in the Planet Money podcast) to ensure a competent and transparent execution of the plan. There's not many places in the world where all those factors exist sadly.

Thank you, this is fascinating!

Holy moly, what a story. I remember reading it a few years ago, and what a crazy example of butterfly effect. The one Norwegian girl who decided she wanted to be an au-pair in London, and met an Iraqi boy there, changed the whole country.

Dutch disease : https://en.wikipedia.org/wiki/Dutch_disease

Also the "resource curse".

Although a more accurate formulation seems to be the "sudden resource curse".

E.g. how the discovery that citrus prevents scurvy and the subsequent spike in prices likely led to the emergence of the Sicilian mafia

In theory you are right but, in practice, that only happens because they don't follow Norway's example :-)

Interestingly there's a connection between WA and Norway that not everyone is entirely pleased about: https://www.fightforthebight.org.au/

Norway - the country that avoided the oil curse

We would love to. Trust me, we really really would.

But the is such huge amount of great mongering about corporate add mineral taxes that no major party will attack it.

The Minerals Council of Australia is incredibly well funded and hugely politically influential.

Nah, we're far too short sighted for that sort of thing.

It's a sad story on the ground:

* We absolutely squandered the previous boom, once the tap was turned off it almost felt like it hadn't happened at all, outside of new developments in the CBD.

* Created an absolutely venomous environment for the workforce. I know dozens of FIFO workers or industrial workers servicing the industry, and I can only think of a few that don't suffer from either substance abuse problems, crippling debt despite massive salaries, depression or other mental health issues, or chronic physical injuries they can't get comp for, not to mention the great strain it puts on their family, and toxic workplaces (Not everywhere, but its not uncommon)

* We've let country towns supporting the industry wither on the vine. If you take Kalgoorlie for an example; Quite a lot of money is being spent in town, and if you take a drive over to the industrial estate most people will tell you that business is booming. The same people have been saying the town is just about ready to pick back up for a couple of years now, but it hasn't, and I don't believe it will. The industrial activity just isn't bleeding over into the town like it used to. The money washes straight back to Perth, back east, and overseas. Half the storefronts in the main drag are closed, and prime showrooms sit empty. The industry has raised the cost of travel to Kal so high that tourism is basically non-existent, and people who used to maintain two households in Perth and Kal are now having to chose one or the other, invariably leaving Kal for Perth

I honestly don't have the expertise to offer a solution to any of these, my gut says collecting fair royalties and using the money to fund services would be a start, but I don't have the background to really make that argument. But what I do know is, for the average punter on the street, it hasn't amounted to much, and one day it'll be gone. I look around sometimes and imagine where we'd be if the prices dropped and the sector closed up shop, and it's a pretty grim picture.

> I honestly don't have the expertise to offer a solution to any of these

My father worked a life time in the mining industry for several Australian mining companies, and as a result I spent a lot of time growing up in mining towns.

By their nature those mining towns can and do feel isolated, but the lived experience of growing up in mining town can be enjoyable.

Move on to the modern day miner and they are predominantly FIFO and that then which creates the problems you have outline.

So my solution would be:

1. The mining company can not use FIFO workers to mine a resource.

2. Instead they have to existing town infrastructure complete with schools, medical centres etc.

3. If no such infrastructure can be found then it will need to be built.

4. If under these rules the resource can't be mined with a profit then it should be left in the ground until it can.

The resources being mined don't belong to the mining companies, but instead belong to the community and to the country.

By using FIFO workers these companies are just taking that resource without giving back anything to the community and if that is all they have to offer then the resource is better of not being mined.

"Fly-In, Fly-Out" rather than a FIFO collection

On the plus side — and I realise I’m playing the devil’s advocate here — I think* some of this boom helped Australia avoid the general downturn that a lot of the rest of the world has seen over the past decade.

People here — normal working dudes — have money. What do they do with it? They spend it. On cars, mostly, but on houses, and TVs, and out in the pub, and whatever else. If that discretionary income hadn’t been floating round our economy for the last decade, I don’t think we’d be in the doing-quite-nicely-thank-you situation we are now.

Totally accept that this is to the detriment of specific places like WA, or Kalgoorlie more specifically. I’m not saying it’s good, just that it’s a thing.

(*I’m not an economist, I don’t work in this industry, and I live in Melbourne, so this is pure armchair economics.)

You are absolutely right I feel, I think the boom played a role in keeping us out of trouble.

But I feel like when you compare us to other natural resource rich countries, we've let them walk away with the goods for free.

And make no mistake, these jobs are temporary (If you take a long view). The industry is happy to just shut down projects the moment the price doesn't make any sense. We've been lucky that there's been enough they want out of our dirt that's there's always something on the go, but sooner or later it'll dry up, and those jobs will vanish, even if only for a while. And we'll be left with very little.

And this doesn't even go into the specter of automation floating over our head.

Some of these issues sound similar to energy workers in Canada.

Yes, eerily similar to the situation in Fort McMurray and other oil towns in Western Canada.

I was literally thinking about the fires a few years ago which exposed how unprepared for any future most people are. Financial literacy is such a need.

Lithium is vastly abundant and is not really the problem. If all else fails you can extract it by distilling sea water. The problem is Cobalt which is essential for working LiIon batteries and is required in equally vast quantities.

No it is not. Tesla has the best batteries in production currently and they use the least amount of cobalt. They even have plans to stop using cobalt completely in future versions. But currently they have a battery that is 20-25% better in most metrics and uses the least amount of cobalt.

And 50% of the world cobalt production comes from DR Congo, a country that hasn't been stable since the 1990s. A lot of that cobalt money ends up in the hands of international mining companies doing dodgy deals with corrupt top government officials.

Nit pick, but "in the hands of international mining companies", mining companies don't have hands, it's never corrupt companies, it's corrupt [groups of] people.

Corporations definitely have a culture, for better or worse. And it's not always just the sum of their employees'.

Ergo "groups of people". It's easy to dismiss the responsibility that lies on people by saying "this or that organisation failed/was malevolent/whatever". Sometimes results are emergent and unexpected, but it seems starkly - from my observations - that individuals usually do realise, and often are consciously in control of their directing influence.

Group effects are known, cf bystander effect. Actually companies show a bystander-like effect, "what we're doing here is evil, someone [else] should change that".

Just because such behaviours are common in groups doesn't mean individuals aren't responsible. It's easier to ignore your moral responsibilities by invoking the company as the responsible party.

No. Not "ergo, groups of people." Not emergent effects. And not the bystander effect.

Corporate culture as in, we want you to be a {insert company name here} person. And the corporation is set up to make that happen.

You're discounting having the ability to mold someone for a decade+, which is not an insignificant effect on their behavior.

There are Li-ion chemistries that don't require cobalt. They don't have quite as high energy density.

I find it astonishing how much iron ore is shipped from Western Aus to China, it would be far more ecologically sounds to smelt it there, same is true with most of the things dug out of the ground. I suppose in the scheme of things this is the thin end of the wedge but shipping unrefined iron ore at a 30% weight premium is desirable so that China has a steel industry without depleting their own reserves of Iron ore.

It's probably down to the labor cost of smelting. Unskilled labor is prohibitively expensive in Australia compared to China. If they manage to fully automate smelting, end to end, I don't see why the smelting wouldn't be done locally in Australia.

You have an assumption that automatics is always cheaper than human labor. This is not obvious to me. You can have humans working 8 hour/day for as cheap as $100/month in some poor regions. And automatics still require R&D, service, electricity.

I don't think Australia has much metallurgical coal. Steel making is dirty, though Australia has plenty of places to make steel where it wouldn't cause a serious local air quality problem.

Australia does have a lot of coal, also exported.

https://en.wikipedia.org/wiki/Coal_in_Australia

Metallurgical coal tends to be biuminous, which AU has much of.

https://en.wikipedia.org/wiki/Metallurgical_coal Also:

http://minerals.org.au/sites/default/files/181012%20Commodit...

They export the coal and the iron ore which I thought was super weird, different sides of the country but still...

China also massively subsidizes its steel industry, and produces it below cost.

I think Australia benefits from royalties AND taxes. The best way is taxes and a tough audit. In addition, the wages paid to the employees are also taxed, so add it all up and Australians do very well on their minerals. Royalties are bad because they flow constantly and when prices fall and the mine makes zero taxable profits, they then close the mine until the price goes up. With non royalty, just the taxes, production can carry on and wages get paid. Wages BTW, are far more than any royalty or taxes.

Royalties are collected because that's what the States are legally able to collect without interference by the Commonwealth.

Hostility to migration might be one of the reason. I have heard story but nothing concrete. Mining is quite difficult industry and without secondary or ternary industries, you can not keep most of the profits to yourself. So perpetual investment needed and people needed to execute that investment. Where is people to do the work coming from ?

Is this going to be the next plastic that's going to destroy & pollute nature? Maybe authorities should invest into developing a good refund solution sooner than later. I already see some destroyed batteries on streets sometimes, and I wonder what they will do to our environment.

No. Lithium isn't cadmium.

In fact, there was a Science Versus podcast about the benefits of lithium in public drinking water. Lithium naturally occurs in some water sources more than others, and areas with more lithium in the water have better mental health.

If you ever visit Ashland, Oregon—famous for its Shakespeare Festival and chill vibes—you’ll have a chance to drink from their “lithia fountain” at the heart of downtown: https://www.trover.com/d/95b7-lithia-water-fountain-ashland-...

Interesting!

What are the effects of too much lithium though?

(To answer myself, from Wikipedia..) >Common side effects include increased urination, shakiness of the hands, and increased thirst.[2] Serious side effects include hypothyroidism, diabetes insipidus, and lithium toxicity.[2] Blood level monitoring is recommended to decrease the risk of potential toxicity.[2] If levels become too high, diarrhea, vomiting, poor coordination, sleepiness, and ringing in the ears may occur.[2]

Plus they are already pretty recyclable unlike plastic. Really lithium is probably one of the 'cleanest' materials we've had for batteries given that they aren't mostly heavy metal like NiCad or Lead-Acid.

However cobalt isn't something you want in your garden!

There is quite a bit of R&D going into negating the need for Cobalt in Li batteries. I would not expect Cobalt to be needed in ~3-5 years (for Li batteries).

Lithium Iron Phosphate is an already-viable chemistry that has a lot of upsides and only a few downsides compared to Lithium Cobalt.

https://en.wikipedia.org/wiki/Lithium_iron_phosphate_battery

The tl;dr is slightly lower energy density (~14%) in exchange for non-toxicity, extremely low self-discharge rates, not prone to runaway thermalling, and great cycle life.

It also has the advantage of being able to be essentially a drop-in replacement for many lead-acid uses.

Enjoy life while we have it. In the long run we're all dead.

TIL that WA is the Saudi Arabia of lithium. And I even live here! And yes: I feel like we absolutely missed a once-in-a-century opportunity by not establishing a sizable sovereign wealth fund off mining royalties.

Entrance to the rabbit hole: http://www.ga.gov.au/scientific-topics/minerals/mineral-reso...

the hospitable area of AU is very small compared to that of EU. AU is mostly outback is it not?

Yeah, something like 60% of the country is basically uninhabitable... As for the rest, there isn’t really sufficient water resources to support much of a larger population without adding huge amounts of desalination.

90% of our population lives within 100km of the coast between Melbourne and Cairns.

However agricultural usage extends far inland in the temperate regions and there has been a lot of opposition to mining activities in our “wheat belts”.

“our minerals”

Australia isn’t communist. If you want to own the land that the minerals come from, buy some shares.

Just be aware that the mining industry isn’t unusually profitable, in fact it is expensive and risky, and owning (part-of) a gold mine isn’t a ticket to unlimited wealth.

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