Lithium explorer makes 'globally significant' discovery in Cornwall

Lithium explorer Cornish Lithium says it has found "globally significant" grades of lithium underground in Cornwall, raising hopes it could meet a large amount of the UK's demand for the battery material.

The private business, headed by former mining analyst Jeremy Wrathall, has been sampling geothermal water near Redruth and says "it almost couldn't believe" the results showing average concentrations of 220mg per litre.

Lithium is a key ingredient in electric car batteries but China, Australia and Chile currently dominate supply, triggering efforts to develop supply chains closer to home.

Cornish Lithium received some funding last year from a government-backed study to assess the feasibility of developing a UK lithium supply. It has also used crowdfunding. It has been studying lithium deposits in hot water brines that welled up in many of Cornwall's disused tin mines.

Mr Wrathall said the project could be in commercial production over the next three to five years. This would coincide with a ramp-up in demand for electric cars as a ban on new sales of petrol and diesel cars looms in 2035.

He stressed it was early days and potential volumes were not clear yet, but added: "We believe the amount we could extract will be significant. The Faraday Institute has said the UK will need about 60,000 tonnes of lithium carbonate by 2035.

"We believe we could produce a significant amount of that. So it's not a trivial amount. It could be that the UK could supply a significant amount - hopefully all of it. But I don't know yet.

"This will be environmentally friendly lithium for the UK. This will be produced here and then taken to a battery factory hopefully in Cornwall; that is a really exciting and green opportunity."

The development could create hundreds of jobs in a boost to Cornwall, which is grappling with a rapid increase in unemployment. The area was once known for its mining industry but the last tin mine closed in 1998. Efforts are under way to restart it following a rise in the global price of tin.

However, experts cautioned that record low lithium prices, partly due to the knock to the global economy caused by coronavirus, could make it difficult to get funding for Cornish Lithium's project.

"It's a positive move for the UK but still in the very early stages," Andy Miller, an analyst at consultancy Benchmark Mineral Intelligence, told Reuters.

"The development of new types of resources outside of brine in South America and spodumene in Australia are going to be needed."

Mr Wrathall said the company  was "actively thinking" about moving to a public listing, possibly within 2-3 years.

"We are going to be building our team to enable that to happen and also to bolster our board to make sure we are ready to be public when the time comes.

"But really we have run this company as if it was a public company, tried to be very responsible.

"We now feel very confident that we could move forward to a listing at an appropriate time."

Cornish Lithium is working on the project with Geothermal Engineering Limited, which is developing a geothermal power plant in Cornwall.