DOD sets up deals to increase domestic nickel, lithium production

The Defense Department announced today it has set up separate commercial agreements to increase domestic nickel and lithium production.

The Pentagon's industrial base policy office "entered an agreement with Albemarle Corp. to support the expansion of domestic mining and production of lithium," a DOD statement reads.

The $90 million agreement will use funds appropriated by the Inflation Reduction Act and will help support Albemarle's planned re-opening of their Kings Mountain, NC lithium mine to increase domestic production of lithium for the nation's battery supply chain, according to DOD. Albemarle estimates that Kings Mountain will be operational between 2025 and 2030.

"The agreement with Albemarle demonstrates the DOD's ongoing commitment to meeting the needs of our warfighter, today and in the future," said Anthony Di Stasio, director of DOD's Manufacturing Capability Expansion and Investment Prioritization office. "This investment directly supports President Biden's April 2022 Presidential Determination for Critical Materials in Large-Capacity Batteries."

In a separate announcement, DOD said it had set up a $20.6 million agreement with Talon Nickel LLC to increase domestic nickel production.

The deal will "advance nickel exploration and mineral resource definition of the Tamarack Intrusive Complex (TIC)," DOD said.

Nickel is essential to make high-temperature aerospace alloys, stainless steel and chemicals for lithium-ion batteries, according to the department. The United States has only one operating nickel-cobalt mine currently meant to last through 2026.

Talon has developed a proprietary suite of geophysical mapping tools, called its Advanced Exploration System (AES), which allows it to rapidly identify and demonstrate economically recoverable nickel minerals, according to DOD. In 2022, the company "deployed the AES at a pilot-scale and they were able to delineate new mineral resources within two additional zones of the TIC in less than one year."

"This award exemplifies the DOD's commitment to strengthening the resilience of critical supply chains and lessening our reliance on foreign sources of vital materials," Di Stasio said in the statement.