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Czech Government, Australian Company Tussle Over Lithium Bonanza

Populist premier plumps for greater state role in extracting the metal, a key ingredient in electric-car batteries.

5 March 2018

An Australian-based mining company says it will continue with plans to exploit a huge Czech lithium deposit despite the government’s bid to cancel the deal.


Last week Czech Industry and Trade Minister Tomas Huner said he had informed European Metals Holding that he considered the deal invalid. Huner had been tasked by Prime Minister Andrej Babis, an opponent of outsourcing the mine to a foreign company, with finding a legal exit from a memorandum of understanding with EMH, The Associated Press reported.


The lithium deposit recently found on the Czech-German border is the largest in Europe, along with one in Serbia, the Financial Times cited Jaromir Stary of the Czech Geographic Survey as saying last year. Lithium is used in the manufacture of batteries for electric vehicles, a market that will boom as the use of electric cars rises.


EMH says the cancellation of the memorandum will not affect its plans to mine lithium below the town of Cinovec, because its rights to explore were guaranteed by the prospecting license held by a firm it owns, Radio Prague reported on 2 March.


The old Czech-German border crossing in Cinovec. Image via Jens Japel/Wikimedia Commons.


The government is keen to exploit this so far untapped natural resource, which could create hundreds of jobs in a region where the last tin mine shut down 25 years ago.


“The aim … is to not only extract but also refine this raw material in the Czech Republic to the fullest possible extent … to be followed by the production of lithium batteries,” the FT quoted Industry and Trade Ministry spokesman Frantisek Kotrba as saying.


 “It [could] be a very important source of future state budget revenues,” he added.


Since his populist party’s election victory last fall, Babis has called for the state-owned uranium miner Diamo to take a major part in mapping and possibly mining lithium resources, Radio Prague wrote in January.



  • Czech lithium resources are estimated at 1.1 million tons, most located in the Cinovec area.


  • The U.S. Geological Survey estimated world lithium resources at about 40 million tons in 2015. Total production was 32,500 tons, most coming from Australia and Chile.


  • “Lithium supply security has become a top priority for technology companies in the United States and Asia,” the USGS reported.


  • EMH says the ancient tin mining industry of Cinovec (“Tintown”) could be revived, noting the area’s undeveloped tin resources are among the world’s largest.

Compiled by Ky Krauthamer

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