Plans to revive lithium mining in Gaston County got a big boost this week when electric car maker Tesla Inc. signed up as the first customer of Belmont-based Piedmont Lithium.
Piedmont plans to build the mine on about 2,100 acres near Bessemer City, about 30 miles west of Charlotte. The deal calls for Tesla to buy up to one-third of the mine's production for five years, with an option for five more.
Once A Lithium Capital
Lithium deposits run in a mile-wide, north-south band through Gaston County. The county once led the world in production of lithium for medical and industrial uses.
But the industry shifted in the 1980s to cheaper deposits in South America and Australia. And most electric vehicle batteries now come from Asia.
Tim McKenna, Piedmont Lithium's head of investor and government relations, said the contract is the first of its kind to bring production back to the U.S.
"The most important thing about this is that it signals the serious beginning of a supply chain for batteries in the United States," McKenna said.
Financial terms of the contract weren't disclosed. But the company said Tesla would account for 10-20% of its total revenues.
McKenna said Piedmont is in discussion with other customers and that landing Tesla has helped spark interest. In fact, the company's annual report out this week is sprinkled with images of Tesla cars being charged.
"It certainly gains the attention of a lot of people on Wall Street," he said. "All of a sudden we're getting calls from a lot of people who want to be associated with us, possibly. And not to mention a lot of calls from the media."
Permits And Capital Still Needed
Piedmont got key state and federal permits for the project last year. It still needs a state mining permit, which McKenna said it expects to apply for soon and get by year's end. The company also still needs Gaston County zoning approval. He said they'll apply for that after they get the mining permit.
Besides the mine, Piedmont also plans to build an ore concentrator.
"The concentrator plant would then take the material, the crushed stone that comes out of the mine, and then refine it into what's called spodumene concentrate, which is the material we would then sell to Tesla," McKenna explained.
Eventually, Piedmont hopes to build a chemical processing plant nearby that also would complete one more key step in the refining process: turning that concentrate into lithium hydroxide. That form is what's used to manufacture batteries.
Piedmont has identified a site in Kings Mountain, but McKenna said state officials in both North and South Carolina recently have been showing the company additional potential sites.
McKenna said once permits come through, the company needs to raise an additional $160 million to build the mine and concentrator. The chemical processing plant would cost another $350 million or so, he said.
The mine initially would be one large pit up to several hundred feet deep in an area that's currently mostly farm fields or woods. Dozens of property owners have signed agreements to sell their land and homes if the development happens.
Mining and deliveries to Tesla could start in 2022 or 2023, the company said.
