Swedish government-owned mine operator LKAB on Thursday announced the discovery of a major rare earth mineral deposit in the northern city of Kiruna, potentially significantly reducing reliance on China for electric vehicle components.
The deposit, the largest such discovery in Europe, is equivalent to more than 1 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 a significant building block for producing the critical raw materials that are absolutely crucial to enable the green transition. We face a supply problem. Without mines, there can be no electric vehicles,” LKAB President and CEO Jan Moström said in a statement.
The discovery could be a game-changer for Europe, which currently has no rare earth mining operations and is entirely dependent on Chinese imports for the metals, which are used in the manufacture of wind turbines and electric cars. As of 2020, 99 percent of rare earth imports to the European Union came from China.
Demand for the minerals is expected to surge as the proliferation of electric vehicles increases, with the EU projecting a more than fivefold increase by the end of the decade. Europe is particularly wary about dependence on imports after Russia’s 2022 invasion of Ukraine highlighted European reliance on Russian oil imports.
The company emphasized it will take time before the deposit can produce any useable raw materials.
“If we look at how other permit processes have worked within our industry, it will be at least 10-15 years before we can actually begin mining and deliver raw materials to the market,” Moström said.
The U.S., meanwhile, has also sought to wrest some of the market share for rare earth minerals from China. In September, the Department of Energy announced $156 million in funding from the bipartisan infrastructure law to create a processing facility for the minerals. While the U.S. has a single rare earth mine in Mountain Pass, Calif., no such processing facility currently exists.