Mineral issues are back in the news. In Europe, questions related to mining and metals have been tucked away in the closet of industrial history. The energy transition and the new dependencies it creates are now breaking down the door of this forgotten closet. The issue is now salient: are we in the process of swapping a dependency on fossil fuels for a dependency on metals? We have collectively lived under the illusion of an abundant supply of metals, ensured by a competitive sector and presenting no geo-economic stakes. The realization is stark: the geostrategic, economic, and industrial issues raised by the extraction and transformation of raw materials are a blind spot in the energy transition.
These questions are at the heart of Métaux, le nouvel Or Noir [1] by Emmanuel Hache and Benjamin Louvet. Academic expert Dr. Hache has been conducting research on the subject for the past ten years. He notably directed the recent GENERATE project (Géopolitique des ENergies Renouvelables et Analyse prospective de la Transition Energétique), funded by the French National Research Agency. As an asset manager specializing in commodities, Benjamin Louvet brings a practitioner’s eye to the table.
After the first section of their book recalls the climate imperative and summarizes the challenges of the energy transition, the second part gets to the heart of the matter. The authors first discuss the scale of the needs raised by the transition and the growing awareness of the strategic nature of certain raw materials. They then delve into the intricacies of mining and metallurgy value chains. While geological constraints – the age-old questions of resource endowment – are of course discussed, the authors’ vision of a broader concept of material criticality is to be commended. For them, it necessarily integrates industrial, environmental, and geostrategic issues. Finally, the authors invite us to look beyond geological inventories and consider the bottlenecks that constrain the development of new mining projects.
The third part of the book looks at the economic, geostrategic, and environmental implications of the transition to low-carbon technologies. From an economic point of view, the extra demand generated by the transition to low-carbon technologies is driving up prices on global metal markets and increasing the manufacturing costs of low-carbon technologies. However, these inflationary effects must be set against the costs of climate inaction. From a geostrategic point of view, the transition should prove favorable for major mining countries (Australia, Canada, the Argentina-Bolivia-Chile lithium triangle), for countries in the Asia-Pacific region (China, Indonesia, Thailand, Vietnam, Burma) and for countries in the geologically endowed African continent (particularly in sub-Saharan Africa). However, there is a long way to go, and the book discusses the ability of these economies to transform this geological endowment into a sustainable economic take-off. This section of the book is also an opportunity to discuss two burning issues: (i) China’s ambitions and leading role in the downstream value chain, and (ii) the future of Russia’s exceptional mining potential. The repercussions on international relations in a context of geostrategic rivalries are not overlooked. The authors also discuss the temptation of cartelization for mining countries. From an environmental point of view, the book reviews the multiple environmental footprints of mining activities. Even when motivated by the low-carbon transition, the boom in new mining projects will generate externalities.
Faced with these issues, the authors draw a number of conclusions. For importing countries, recycling appears to be a strategic imperative, but it remains handicapped by its cost and uncertainty about the sector’s potential. This observation leads the authors to consider policies aimed at moderating demand. From a geopolitical point of view, the mineral issue is a new arena for antagonism between the USA and China, and the book reviews the strategies implemented by these two giants.
The book concludes with a discussion of the uniqueness of the European position, highlighting France’s shortcomings. With its unfavorable geological endowment, the continent’s dependence is difficult to circumvent, but the authors also note numerous strategic errors and deplore the absence of a geostrategic vision within the EU. On a more positive note, the book highlights the EU’s strengths (notably its financial and technological capabilities). But will they be sufficient?
The great strength of this book lies in its pedagogical qualities. While the lively style makes for pleasant reading, the rigor of the precise, well-documented content shows that it is possible to address the widest possible audience while keeping academic standards high. The discerning reader might have wished that the book had gone into more detail on industrial policies likely to encourage the growth of recycling, or on European options (particularly in terms of industrial or geostrategic positioning). However, these emerging topics are currently the subject of research, and these omissions do not detract from the book’s quality. In short, this is an interesting, well-produced work that provides food for thought on a major subject that has been ignored for too long. Let’s hope it finds a wide readership – it highly deserves it!
Olivier Massol, Professor of Economics, IFP School – ENSPM, Manager of the CEC Energy Transitions Program
[1] Hache, E. & Louvet, B., Métaux, le nouvel Or Noir, Ed. du Rocher, pp 240.