Swedish mining operator LKAB, owned by the Swedish government, announced on Thursday the discovery of a large deposit of rare earth minerals in the northern city of Kiruna, potentially significantly reducing dependence on China for components of electric vehicles.
The deposit, the largest such discovery in Europe, is equivalent to more than one million metric tons of rare earth oxides, according to LKAB.
“This is the largest known deposit of rare earth elements in our part of the world, and it could become an important element in producing the critical raw materials that are absolutely crucial to enabling the green transition. We are facing a supply problem. Without mines, there can be no electric vehicles,” LKAB CEO Jan Moström said in a statement.
The discovery could be a game-changer for Europe, which currently has no rare earth mining and relies entirely on Chinese imports for the metals, which are used in the manufacture of wind turbines and electric cars. In 2020, 99% of rare earth imports into the European Union came from China.
Demand for minerals is expected to grow as the proliferation of electric vehicles increases, with the EU forecasting a more than fivefold increase by the end of the decade. Europe is particularly wary of import dependence after Russia’s 2022 invasion of Ukraine highlighted Europe’s dependence on Russian oil imports.
The company stressed that it will take time before the deposit can produce usable raw materials.
“If we look at how other permitting processes have worked in our industry, it will take at least 10 to 15 years before we can actually start mining and deliver raw materials to market,” Moström said.
The United States, meanwhile, has also sought to wrest some of the rare earth minerals market from China. In September, the Department of Energy announced $156 million in funding from the bipartisan Infrastructure Act to create a mineral processing facility. While the United States has a single rare earth mine in Mountain Pass, California, no such processing facility currently exists.