Open Source: Inside North Carolina’s past and possibly future lithium mine

I’m Brian Gordon, tech reporter for The News & Observer, and this is Open Source, a weekly newsletter on business, labor and technology in North Carolina.

In 1988, the lithium mine in Kings Mountain closed after 50 years. Suppliers found it cheaper to source the valuable silvery-white material in South America than North Carolina.

Decades of rainfall have since turned the empty mine west of Charlotte into a picturesque lake with fish, turtles and 1.8 billion gallons of water. Its deepest point reaches 163 feet.

As demand for lithium soars today, a Charlotte-based resource company called Albemarle hopes to reopen the mine. In 2015, Albemarle purchased the 1,200-acre site and has an ambitious plan to get to the lithium buried in the hardrock below the water: It intends to drain the lake over the course of more than 16 months at a rate of 2,500 gallons per minute.

The company says the lake water will be filtered, treated, and pumped into a nearby creek.

Albemarle currently operates the only active U.S. lithium mine, in Silver Peak, Nevada. But the dormant Kings Mountain mine could eclipse Silver Peak’s output by a factor of 10, Albemarle officials told The News & Observer this week during a media tour of the site.

Lightweight with a high-voltage capacity, lithium is ideal for electric vehicle batteries. And North Carolina is part of an emerging “EV battery belt” forming across the Southeast United States.

In recent years, the state has announced lithium-ion battery projects in Randolph County, Chatham County, Mebane, Morrisville, Davidson County and outside Wilmington. It isn’t a coincidence. The federal Inflation Reduction Act incentivizes domestic EV battery production. Manufacturers have been drawn to the American South by its ample land, cheaper electricity, railways, and lower unionization and labor costs.

In the future, Albemarle would like incoming battery producers like Toyota and VinFast to source their lithium from within the state, says Kirsten Martin, the company’s community affairs manager.

Albemarle intends to request key site permits next year, Martin said. Depending on approvals, construction could commence in late 2025 with hardrock drilling beginning as early as 2026.

The region west of Charlotte is lithium rich, and Albemarle is just one of the local players.

Last week, U.S. Treasury Secretary Janet Yellen visited Livent’s lithium hydroxide processing facility in nearby Bessemer City. Another Charlotte-area lithium company, Piedmont Lithium, is lobbying to build a brand new mine in Kings Mountain. Just this week, North Carolina granted Piedmont Lithium an extension until next year to provide additional information for its mine permit application, according to Reuters news service. The company initially filed its mining application in 2021.

Any large-scale mining project must survive extensive environmental review before proceeding. Neither Albemarle nor Piedmont Lithium yet has a green light.

But it’s interesting to see a North Carolina manufacturing sector that faded due to outsourcing potentially come roaring back. And between prospective mines and numerous promised battery producers, the state is increasingly committing to lithium.

On to the rest of this week’s news:

Triangle quantum computing pushes ‘new limits’

Will any of us be around to witness quantum advantage, the elusive moment a quantum computer outperforms a classical machine on a real-world task? Researchers at Duke University and N.C. State say the industry inches closer to this long-sought breakthrough, with advancements in engineering to thank.

“I think they’re really starting to bring a lot of these near-term quantum applications into sight,” said Jungsang Kim, a Duke researcher who cofounded the quantum firm IonQ. Duke partners with IonQ to advance one particular type of quantum computers called ion-traps.

In contrast, N.C. State is working with IBM on another leading quantum machine called a superconductor. Just this week, Big Blue introduced a new processor, nicknamed Heron, which promises to be the company’s best performing quantum computer yet.

Companies, schools and even the U.S. Army have poured resources into studying quantum computing, lured by the technology’s immense potential to revolutionize a wide range of industries.

‘Crazy’ tax requirement pushes NC biotech startups to the brink

Insane. Ridiculous. Triangle-area founders don’t mince words when describing the ramifications of a new tax law that requires companies amortize their research and development expenses. The policy is technical but its impact, especially on grant-funded companies, is stark:

Qatch Technologies, a biomedical company in Durham, saw its taxable income increase nine times in 2022 compared to the previous year, despite no considerable rise in revenue or profit. The partners of Dignify Therapeutics in Research Triangle Park had their personal tax bills suddenly jump by tens of thousands of dollars.

The new rule, passed during the Trump administration but only going into effect last year, threatens the future of grant-backed startups, founders say, deterring the kind of innovation that produces new products and treatments.

North Carolina Sen. Thom Tillis and Commerce Secretary Machelle Baker Sanders have each called for the rule to be adjusted. But for now, many founders say they are teetering on the verge of bankruptcy.

“This is so crazy,” said Zehra Parlak, who founded Qatch as a postdoctoral student at Duke University. “We all thought ‘surely (the tax law) won’t go into effect.’ But it did.”

Short Stuff: Fiber internet in Triangle’s small towns

• The U.S. Postal Service will take steps to strengthen Research Triangle Park delivery service. Local limitations have long been an obstacle to conducting business, RTP companies say, as the area’s lone post office doesn’t deliver them mail.

• The Triangle adds an early-stage investment fund, Primordial, which will target three to five software startups a quarter.

• A regional internet provider is expanding fiber connectivity in smaller North Carolina towns, including Mebane and Clayton (and soon, in Harnett County). These communities should brace for faster speeds but also possible construction disruptions.

• MetLife, which has its global technology campus in Cary, awarded four Triangle nonprofits $250,000 each as part of the company’s equity fund program. One local grantee, Forward Cities, will direct the money toward supporting Black-run businesses through its Black Wall Street Forward Initiative.

• Is the governor’s green energy-driven economic plan working? Gov. Cooper says yes. But a conservative critic says diving into clean energy jobs will lead to inefficiencies.

• Wolfspeed is all-in on silicon carbide. Last weekend, the Durham semiconductor company sold its radio frequency division for around $75 million in cash and another $60 million worth of stock.

The chipmaker used to produce LED lights under the name Cree, but in the past few years, it’s pivoted hard toward silicon carbide, a unique type of chip material.

“The completed sale of Wolfspeed RF is the final step in our transformation,” Wolfspeed CEO Gregg Lowe said.

The week ahead: AgBiome’s layoff deadline

On Monday, Durham Starbucks employees will vote whether or not to unionize. If approved, more than 20 baristas and shift supervisors will be represented by Workers United. It would be the third North Carolina Starbucks to unionize, and the Triangle’s first.

And next Friday is the day AgBiome set to potentially lay off all 123 of its employees. The RTP biotech company announced looming total cuts in October, citing a lack of investor funding. I reached out to the company this week for an update.

“We have a bunch of discussions going on that are of course confidential, so we can’t mention anything until we have a negotiation concluded,” Agbiome cofounder and co-CEO Scott Uknes said in an email.

National Tech Happenings

• Google launches its AI model Gemini as the search engine giant chases the success of rival ChatGPT.

• Meta is rolling out end-to-end encryption on Facebook messenger. A plus for privacy advocates, some government agencies fear it will more easily obscure illegal activities.

• A crypto comeback? Bitcoin is back selling above $40,000 for the first time since Spring 2022. On the year, the coin value has increased more than 150%. Part of the reason: optimism that regulators will approve the first Bitcoin-tracking spot exchange-traded fund, which would make trading the coin more conventional (without the need for crypto wallets).

Perhaps the Triangle’s true crypto believers will be vindicated in the end. Or maybe people will lose a bunch of money. Possibly both.

Thanks for reading!

Open Source

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