Sigma’s Potential Partnership with Tesla Could Transform Lithium Mining

In Mine & Quarry by Jim Silva

Negotiations between the lithium supplier and Elon Musk’s electric vehicle manufacturer point toward an emerging market for the critical battery ingredient.

The market for electric vehicles is expanding and doing so rapidly. According to the International Energy Agency (IEA), the global electric car fleet surpassed 5.1 million vehicles in 2018 — 2 million more vehicles than 2017, and nearly doubling the total number of new electric car registrations.

Talks between the two companies are still ongoing, but it’s clear that the electric vehicle boom represents an enormous strategic opportunity for lithium mining companies. As industry stakeholders prepare to leverage heightened demand, however, it’s important that they continue to invest in their worksites — such as through chemical dust control for haul and access roads, — just as much as they do in their relationships with electric vehicle manufacturers.

What the Potential Partnership Entails

Sigma has been given the green light to start mining hard rock lithium in the Brazilian state of Minas Gerais. This access has attracted the interest of Tesla, which asked Sigma to meet with Ganfeng Lithium in order to discuss a working relationship. The partnership would include providing lithium materials either to Tesla or to one of its suppliers, like Ganfeng.

However, the partnership is still in the negotiating stages. According to Sigma Chief Executive Calvyn Gardner, it’s not yet decided whether Sigma would ship exclusively to Ganfeng in China or if materials would go directly to Tesla in California. As these details get hammered out, a landmark agreement may be made.

An Emerging Lithium Market

If Sigma and Tesla finalize a working relationship, it could have a transformative impact on the lithium market. With electric vehicle sales on the rise and Tesla committed to making their cars more widely affordable, the demand for lithium could reach the boom that industry stakeholders have been anticipating for the past several years.

In fact, Sigma has already begun making similar deals with other car manufacturers. The company partnered with Japan’s Mitsui, securing $30 million for a planned commercial plant. In return, Sigma will provide Mitsui with about one-third of the facility’s projected output of 220,000 tons. 

Making the Most of Mining Facilities

Lithium mining companies would do well to prepare for the widely expected rise in electric vehicle sales. With cars, trucks, and other machinery requiring an enormous supply of lithium batteries, there are significant opportunities for unbridled growth. At the same time, mining companies should be considering what they need to do to prepare for heightened demand. For example, it’s critical that worksite haul and access roads are properly maintained and cared for during extended use.

Luckily, Midwest Industrial Supply, Inc. can help. With more than 40 years of experience providing custom dust control application strategies and patented products to industrial-grade operations, Midwest has the requisite know-how to get the job done. Our line of dust control products uses advanced synthetic organic materials to penetrate dust and bind surfaces to allow for heavy volumes of every kind of use.

While some companies think of dust control as a by-the-gallon service, Midwest is unique in its results-driven approach. We conduct site visits to evaluate and strategize on the best possible plan for your needs. If you’re looking for a turnkey dust control solution, our managed service program may be just what you need.

Jim is Midwest’s Business Unit Manager for Global Mining. He is experienced in operations management, asset management, and business improvement.

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