Commodity Online
NEW DELHI: The world knows Bolivia as a country reeling under severe financial woes and raved by civil wars. Bolivia’s only claim to fame apart from the revolution is its rich mineral stocks.

But, Bolivia’s pathetic financial conditions are set to change if the world’s new found love for lithium continues.

Bolivia is the only country in the world which has huge reserves of lithium. And there is big demand for lithium, a scarce mineral which is essential for the production of environmentally-friendly electric cars.

Bolivia has the world’s largest reserves of the mineral, at least 800 million tonnes. With the recent change in the constitution, mining of lithium from Bolivia will not be an easy task any more for foreign companies.

President Evo Morales has been setting conditions in the recent past. Foreign companies have been stripping the country of its natural riches for far too long, while Bolivia’s people have received little in return. This time, Bolivia must get a fair price.

Lithium is the lightest metal in existence. It does not occur in nature in its pure form but in a variety of salt compounds. It is widely used in the nuclear industry because of its ability to withstand very high temperatures.

Lithium reacts violently with water, releasing hydrogen gas. This characteristic makes it a useful fuel for torpedoes.

The United States extracts lithium for this purpose in California and Nevada but the production figures are classified.

One of its compounds, lithium carbonate, is used in western psychiatry as a treatment for bipolar disorder, although it is known to have serious side effects.

The languishing car industry is pinning its hopes on new low-CO2 technologies centred on powerful lithium-ion batteries as the main energy source.

Lithium-ion batteries are expensive to produce but there is growing interest in their use since they allow high energy concentrations: a lot more energy can be stored in the same space.

You need a whole trunkful of conventional batteries to power an electric car, while the equivalent in lithium-ion batteries can be stored behind the back seat or under the floor.

There are only a few places where lithium can be mined in significant quantities: the mountains of Tibet, Chile and Argentina. However, the largest reserve by far is found under salt flats in Bolivia.

The Salar de Uyuni is the world’s largest salt flat. It covers an area of 10,582 square kilometres at 3,650 metres above sea level, in the Potosí department in the southwest of the country.

Once a prosperous region known for its mineral riches, Potosí has fallen on hard times. Now the highland region is again a gold mine. The price of the new gold, lithium is expected to climb even higher.

Some see Bolivia as the Saudi Arabia of Latin America: the country’s lithium reserves are estimated to make up around 40 per cent of the global supply.

Potosí region was so rich in minerals at the time of the Spanish conquest in 1545 that one could see veins of silver with the naked eye. The indigenous inhabitants were forced to work in the mines. The local population did not benefit since the silver was shipped to Spain.

After independence in 1825 foreign companies continued to ransack the region’s mineral wealth with the help of the Bolivian government which was controlled by a white upper class.

The modern electric car uses lithium batteries. The development of the electric car is a growing industry since the vehicle helps to meet environmental targets and oil reserves are declining and will eventually run out.

Experts believe that lithium will become an important source of fuel in the future. In 2003, lithium traded for $350 per tonne; now the price is $3000.

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