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Portuguese villagers fear hunt for lithium will destroy their livelihoods

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FUNDÃO, Portugal — A sleepy town in central Portugal, surrounded by lush hills and cherry trees, Fundão is one of six areas the government earlier this year approved for lithium exploration. But locals are fighting back.

Lithium is a key ingredient in batteries to power electric vehicles and other green technologies the EU needs to deploy at scale to hit its Green Deal goal of becoming climate neutral by 2050. The urgency of ramping up renewable energy and kicking fossil fuels has only grown since Russia’s invasion of Ukraine.

But in Fundão and other towns across Portugal, plans to open new mines are driving a wedge between the government and local communities, which worry that extraction activities could harm the environment and nearby farms, undermining their livelihood.

“I’m afraid of the project,” said Aníbal Cabral, head of a local agricultural organization in Fundão. Mining risks depleting and contaminating water reserves and would create noise pollution and dust, he said.

João Galamba, the country’s secretary of state for energy, shrugs off those concerns, arguing they stem from “deliberate misinformation” and “propaganda” spread by NGOs to rally residents against the mines.

“They have poisoned the public debate,” he told POLITICO. “One of our jobs, of course, is to try to provide correct information.”

Secretary of State for Energy João Galamba at his desk in Lisbon | Leonie Kijewski/POLITICO

But some people from Fundão say the government hasn’t done enough to respond to their concerns about the potential impact on their communities. It’s a “massive problem,” said Cabral, who accused Lisbon of not properly consulting at the local or municipal level before announcing its plans.

Many are not against lithium mining as such, said Cabral. If agricultural land is spared, the plans could actually benefit the region by investment and creating jobs, he said.

Artur Trindade, 33, who lives in Pêro Viseu, a village of 700 inhabitants that could soon be home to a new lithium mine, said he hoped the project would help revive the area.

“We need people here,” said João Marçalo, a priest in Capinha, the next village over.

Environmental scrap

Similar disputes have been rumbling on in other towns for a long time — with results that aren’t particularly encouraging for environmental campaigners.

In Barco, some 20 kilometers from Fundão, the government and local groups had been at loggerheads for years when, in October, the state signed a concession contract with company Neomina, Minérios da Argemela despite the opposition of many residents and the municipality.

Gabriela Margarido, a quietly energetic woman in her fifties, throws her hands in the air when asked about what she worries will happen next.

“It’s directly in our backyard,” she said of the mine, which lies just a kilometer from the village. Like in Fundão, the area could see water contamination and erosion, according to Margarido, who leads a local environmental group aimed at protecting the mountainous area.

Activists say the government hasn’t proved that the mines won’t cause harm, but the government says impact assessments, checked by a national agency, show the projects won’t damage the environment.

Margarido calls that just another fig leaf, pointing out that Lisbon signed the Barco concession contract before the company carried out its assessment.

Activist Gabriela Margarido in front of the Argemela mountains, for which the government recently granted a concession to a mining company for extracting lithium | Leonie Kijewski/POLITICO

The National Laboratory of Energy and Geology (LNEG), the Portuguese government’s research branch, defends Lisbon’s plans. The chair of the executive board, Teresa Ponce de Leão, said modern lithium mining only carries minor environmental risks.

In a bid to ward off local resistance, mining companies are presenting environmental mitigation plans that include provisions like recycling most of the water used during extraction and preventing water contamination.

But activists aren’t buying it, saying the measures don’t go far enough and don’t tackle longer-term issues like soil acidification.

Those disagreements are raising tensions, especially as the government can choose to force people off their land if there is no amicable settlement.

“The law has always, always given the possibility of expropriation,” said State Secretary Galamba, who was reappointed to his position not long after he talked to POLITICO.

If that were to happen in Fundão it would be an explosive move and deepen an ongoing dispute between the government and local municipalities on who owns the land and who should pay for a green transition.

“I was incredulous,” Fundão’s Mayor Paulo Fernandes told outlet Público upon hearing about the government’s plans to open a mine that would encroach on local agricultural land.

Although the law requires the mining company to pay a profit-sharing fee split between the government and the municipality, Fernandes said it would only cover a fraction of the income generated by agriculture.

Risky business

While the government pushes the narrative that its plans will help bolster the EU’s strategic independence when it comes to raw materials, experts aren’t so sure the strategy will pay off.

Portugal already has Europe’s largest lithium industry, mining about 900 tons in 2020, or 1 percent of global production. Chile produces about 20,000 tons and Australia 40,000 tons.

Savannah is in the process of opening a new mine in Portugal’s north by 2025, a project that’s not part of the six areas the government recently opened for lithium prospecting. It’s hoping to produce about 5,000 tons of lithium a year once its Barroso mine is up and running, aiming to supply higher-quality lithium for electric car batteries.

David Archer, CEO of Savannah, hopes that some of the project’s €110 million cost can be financed by the EU, which is looking to ensure that it’s more self-sufficient in critical raw materials.

The accelerating shift to electric vehicles and renewable energy is creating a global lithium shortage; prices more than doubled last year.

But the economic argument for opening mines in Portugal is shaky because it’s a high-cost producer, said geologist Carlos Leal Gomes.

In South America, for example, lithium is extracted from saline fields and not mined — a faster process that costs about half as much as mining.

Even LNEG, the national research agency, concedes that the government may not be able to open as many mines as it hopes. Ponce de Leão, the chair of the executive board, said a lithium expert at LNEG “has doubts about the quantity of mines that will be open in Portugal.”

Despite those qualms, both developers like Savannah and the government are plowing ahead with lithium projects in the face of local resistance.

Galamba called the outcry over opening more mines in Portugal hypocritical. Lithium has to be mined somewhere to fuel the green transition, he said. At least in Portugal, the country will follow legal standards and work to mitigate any environmental impact.

But Margarido is skeptical. She supports the EU’s climate goals, she said, but achieving them shouldn’t be done at the expense of local communities.

“We’re all in favor of the green transition, but not by sacrificing all the people here,” she said. “What is the life of the people living here worth?”

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