June 22 (Reuters) - Piedmont Lithium Inc's first
steps toward securing lithium supplies will be in Quebec or
Ghana, not the United States, as an intensifying North Carolina
regulatory review delays the miner's goal of anchoring America's
electric vehicle battery renaissance.
The delay has forced Piedmont to expand its strategy beyond
its proposed North Carolina mine - a project it has touted as
the best way to help secure American energy independence, but
one that now faces a regulatory quagmire - and fund mines
"We think two of our projects will happen faster than our
Carolina Lithium project: Quebec and Ghana," said Chief
Executive Keith Phillips. "The (North Carolina) regulators are
doing a very good job. It's a rigorous process. It'll happen
when it happens."
Piedmont was founded in 2016 in Australia but moved its
headquarters last year to North Carolina, where it hopes to dig
a 500-foot-deep (150 m-deep) open-pit mine in a $988 million
project that would be one of the largest U.S. lithium mines.
The relocation was designed to be closer to EV manufacturing
plants being built across the U.S. South by Toyota, SK
Innovation and others.
Piedmont signed a deal in 2020 to begin supplying Tesla Inc
with lithium sometime between July 2022 and July 2023
from the North Carolina mine, but last year delayed the first
shipments without a definitive date for when deliveries could
begin. (Full story) https://www.reuters.com/business/energy/piedmont-says-has-delayed-timeline-supply-lithium-tesla-2021-08-02
Reuters reported last summer that Piedmont's chaotic roll
out of that plan - in which it wooed Wall Street and Tesla
before local residents - had fueled concerns about levels of
dust, noise and vibrations in the area just outside Charlotte.
(Full story) https://www.reuters.com/business/energy/push-supply-tesla-piedmont-lithium-irks-north-carolina-neighbors-2021-07-20
Those issues are now the focus of the state mining review
process that officials and the company itself acknowledge has no
clear end date. Piedmont does not have an expectation for when
its North Carolina facility will open.
As opposition to the North Carolina mine grew, Piedmont
invested last year in Quebec-focused Sayona Mining Ltd
and Ghana-focused Atlantic Lithium Ltd.
Meanwhile, Albemarle Corp, the worlds biggest
lithium miner, is hiring staff and buying land in a neighboring
North Carolina county as it mulls re-opening a mothballed
spodumene lithium mine that would compete directly with
North Carolina regulators asked Piedmont in January for more
detail on 12 points they felt were not adequately explained in
the company's mining permit application, according to regulatory
Regulators asked Piedmont to explain how the proposed mine
could affect water table levels, as well as how to modify mine
site blasting on cloudy days to limit dust that could affect a
nearby airport's operations.
The state additionally has "many concerns" about Piedmont's
plans to discharge chemicals into the public sewer system,
according to the filings, and archaeologists have recommended
that Piedmont erect a 25-foot buffer around four cemeteries at
the mine site, a step that could force the company to change its
Piedmont responded to the queries with more than 1,000 pages
of data, charts and other information that was posted to the
state regulatory website on Wednesday afternoon.
Shares of Piedmont fell 5.5% to close Wednesday at $46.38.
While investor appetite for lithium stocks has been high in
recent years, Piedmont has outperformed even among peers,
hitting a record high near $80 this past spring before
softening. In March, it booked $130.8 million in a secondary
Seven analysts rate Piedmont stock a "buy" with all
expecting it to trade higher, according to Refinitiv Eikon.
Piedmont said it has applied for U.S. Department of Energy
loans, although the company would need to have its North
Carolina permits before it would receive government support. The
funds could not be used to dig mines in Quebec or Ghana.
In January 2021, Piedmont bought a roughly 20% stake in
Sayona and its Quebec lithium projects. First production is
expected next year.
Piedmont also took a 9% stake in Ghana-focused Atlantic
Lithium, and committed to spending $17 million on a feasibility
study and $70 million on building Atlantic's Ewoyaa lithium
The market value of both investments has surged in the past
year due in part to rising lithium prices. Piedmont will not
operate the mines in Quebec or Ghana but has agreed to buy at
least half of each company's production of a lightly processed
type of lithium known as spodumene concentrate.
"The potential for Piedmont to generate cash flow as early
as 2023 is being overlooked by the market," said Canaccord
Genuity analyst Reg Spencer, referring to Quebec.
Pushback from residents and regulators is not Piedmont's
only problem in North Carolina.
Albemarle, which supplies Tesla, appears set to reopen its
Kings Mountain, North Carolina, mine in a mining-friendly county
near Piedmont's proposed site.
In March, it bought 60 acres (25 hectares) that abut that
mine site, hinting at the company's future expansion plans.
Albemarle has also recently posted job openings to help run the
Albemarle is conducting initial geological tests and the
project could open by 2027, spokesperson Kim Ronkin Casey said.
Lithium produced from spodumene rock can be used to make
lithium hydroxide, which is prized by EV battery manufacturers
partly because it holds a charge longer than the more-common
The United States does not have an active lithium spodumene
mine, so the first one to open will garner huge interest from
the country's nascent battery sector.
Albemarle said it has been sharing its plans widely with the
local community, taking the opposite tack from Piedmont, which
purposefully did not approach local residents with its plans for
"There's a lot of work we're doing also with the community,"
said Eric Norris, head of Albemarle's lithium division. "We've
engaged them very early on."
(Reporting by Ernest Scheyder; Editing by Amran Abocar and