Tuesday, February 3, 2009

Move over oil, here comes lithium (and Bolivia)!

As the market for electric and hybrid cars expand, so does the demand for lithium-ion batteries, the preferred choice of powering them, nearly half of which is found in Bolivia, under the sands of Salar de Uyuni, the world’s largest salt flat. Accordingly, global car makers have been queing up to La Paz to strike deals to tap the resource. Lithium is considered superior to nickel, in view of its lightness and its ability to store more energy, enabling electric cars to be driven longer distances.

What complicates the situation is the socialist government of President Evo Morales, which has nationalized the country's oil and natural gas industries, and the fact that the lithium mines are located within indigenous Indian terriroties. The former sees a distinct possibility that "Bolivia can become the Saudi Arabia of lithium", while the latter, rightly so, sees lithium as their ticket out of poverty.

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