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Strategic roadmap for the development of Finnish battery mineral resources

Authors:
  • Geological Survey of Finland, Rovaniemi,Finland
Geological Survey of Finland 2021
Strategic roadmap for the development of
Finnish battery mineral resources
Pekka Tuomela, Tuomo Törmänen and Simon Michaux
GTK Open File Research Report 31/2021
MSP1/
MHP1
MSP2/
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Scenario 1 (hydromet)
Central hydrometallurgical facilities &
Terr a fame/FBC downstream refining
pCAM
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GEOLOGICAL SURVEY OF FINLAND
Open File Research Report 31/2021
Pekka Tuomela, Tuomo Törmänen and Simon Michaux
Strategic roadmap for the development of Finnish battery
mineral resources
Unless otherwise indicated, the gures have been prepared by the author of the publication.
Front cover: Exploration activity for nickel and cobalt during fall 2020. Maps include also known
deposits for these commodities with some of the most notable specied by name. Note that cobalt
map does not show the deposits, where Co is listed as other commodity of secondary importance.
Maps are based on GTK mineral databases and Tukes mining registry. Third map shows one
possible scenario of Finnish battery value chain development utilizing the resources in these
deposits. Maps prepared by the authors.
Layout: Elvi Turtiainen Oy
Espoo 2021
Tuomela, P., Törmänen, T. & Michaux, S. 2021. Strategic roadmap for the development of
Finnish battery mineral resources. Geological Survey of Finland, Open File Research Report 31/2021,
78 pages, 21 gures and 18 tables.
Nickel and cobalt are among the most essential battery commodities. DRC produces 70%
of world cobalt as copper mining byproduct. Nearly third of cobalt is produced elsewhere
as by-product from lateritic and sulphidic nickel mines. Southeast Asian countries produce
over 50% of world nickel. The nickel deposits in these countries are predominantly later-
itic ores. Main sulphidic nickel deposits and mines are located at higher latitudes (Russia,
Canada, Finland). Traditionally the sulphidic deposits have been exploited for the battery
applications but lateritic nickel and cobalt is being increasingly utilized due to limited supply
from sulphidic deposits. Intermediate feedstocks like mixed hydroxide precipitate (MHP)
and mixed sulphide precipitate (MSP) are preferred feedstocks for the battery chemical
manufacturers, these in turn rened into precursor and cathode active materials to feed
the cell and battery factories.
Utilization of lateritic nickel deposits is in practice crucial for adequate supply of nickel and
cobalt, considering soaring demand. For nickel, the global supply was 1.5 Mtpa in 2000 but
has grown to 2.5 Mtpa in 2020. The demand could exceed 3.5 Mtpa by 2030 and 4.5 Mtpa
by 2040 whereas projected supply does not exceed 3.5 Mtpa even in the 2030s. It seems like
investments into new mines and production capacity cannot match the increasing demand
for nickel or cobalt either. Furthermore utilization of lateritic deposits has several drawbacks
against sulphidic deposits. For example typically much higher CO
2
and biodiversity footprint
amongst many other sustainability indicators as well as societal challenges in these countries.
The Finnish battery ecosystem is one of the most developed in Europe. Finland is the pre-
dominant producer of primary nickel and cobalt in European comparison, also being the
most important producer of rened products for these commodities, as well as feedstocks for
the battery industry although partly operating based on imported raw materials. Currently
the Finnish battery ecosystem contains ve basically separate streams for nickel and cobalt
rening, to big extent operating on imported raw materials.
Future roadmap (2020–2050) for new battery metal and mineral mines is presented in this
report. It is estimated that Finnish nickel production could increase to the level 50 000 tpa
(41 400 t 2020) and cobalt production to the level of 2 500 tpa (1 560 t 2020) during the
following decades. Even higher production gures are possible if the major mine projects
advance as planned. On the other hand, the worst-case option is that domestic production of
these commodities will be nearly zero from mid-2030s onwards in case new mines are not
opened or the life of mine for the current mines is not extended. Three downstream value
chain scenarios are presented, how the raw materials could be rened to most effectively
feed the Finnish battery ecosystem. It is estimated that roughly 40 GWh cell factory could
be sourced (cathodes) mostly from domestic raw materials, equaling the size of Northvolt
Skellefteå plant after the planned expansions. For anode production (graphite) there are
domestic production opportunities as well.
Keywords: nickel, cobalt, supply, demand, value chain, strategy, roadmap, scenario, Finland
Pekka Tuomela and Tuomo Törmänen
Geological Survey of Finland
P.O. Box 77
FI-96101 Rovaniemi, Finland
E-mail: pekka.tuomela@gtk.
Simon Michaux
Geological Survey of Finland
P.O. Box 96
FI-02151 Espoo, Finland
2
CONTENTS
1 NICKEL AND COBALT OVERVIEW ............................................................................................................... 4
1.1 Introduction ...........................................................................................................................................4
1.2 Nickel and cobalt Supply/Demand scenarios .....................................................................................5
1.2.1 Market balance in short and long term ................................................................................... 5
1.2.2 Nickel-cobalt discoveries and mine development timeframe .............................................. 8
1.2.3 Automotive stock development and electrication................................................................ 9
1.2.4 Recent NPI developments .........................................................................................................9
1.2.5 Environmental and societal considerations ...........................................................................10
1.2.6 Finland’s contribution to EU nickel and cobalt value chain ................................................17
1.3 Nickel and cobalt primary production .............................................................................................19
1.4 Finnish mine production and reserves .............................................................................................30
2 COBALT AND NICKEL VALUE CHAIN AND MATERIAL STREAMS IN FINLAND ....................................32
2.1 Production breakdown for the current mines and reneries .........................................................32
2.2 Finnish Ni-Co rening streams .........................................................................................................34
2.2.1 Stream 1 ......................................................................................................................................35
2.2.2 Stream 2 ................................................................................................................................... 38
2.2.3 Stream 3 .................................................................................................................................... 40
2.2.4 Stream 4 ....................................................................................................................................41
2.3 Geometallurgy and applicable products for nnish primary streams ...........................................43
3 FINNISH BATTERY STRATEGY AND ASSOCIATED FUTURE PRIMARY PRODUCTION ROADMAP ...... 45
3.1 Finnish Battery Strategy .....................................................................................................................45
3.2 Mine development lead time ..............................................................................................................47
3.2.1 Global perspective ................................................................................................................... 47
3.2.2 Finnish perspective .................................................................................................................48
3.3 Roadmap .............................................................................................................................................. 49
3.3.1 Potential feedstocks ................................................................................................................56
4 FUTURE SCENARIOS ................................................................................................................................... 62
4.1 Scenario Zero ......................................................................................................................................62
4.2 Scenario 1 .............................................................................................................................................62
4.3 Scenario 2 .............................................................................................................................................65
4.4 Scenario 3 Pyrometallurgical route .................................................................................................. 66
4.5 Other potential future streams ......................................................................................................... 68
4.6 Production opportunities ................................................................................................................... 68
4.7 Cell factories and downstream applications ..................................................................................... 71
5 SUMMARY AND CONCLUSIONS ..................................................................................................................71
5.1 Global nickel and cobalt supply and demand ................................................................................... 71
5.2 Finnish battery ecosystem and future roadmap .............................................................................. 73
REFERENCES ...................................................................................................................................................... 75
3
Geological Survey of Finland, Open File Research Report 31/2021
Pekka Tuomela, Tuomo Törmänen and Simon Michaux
1 NICKEL AND COBALT OVERVIEW
1.1 Introduction
Nickel and cobalt are essential commodities for lith-
ium ion battery (LIB) production and also important
commodities for the Finnish mining industry.
This paper presents an overview of the current
nickel and cobalt primary production and connec-
tion to the battery production value chain glob-
ally and especially in Finland. Also, downstream
rening for battery industry raw material sourcing
is discussed, with emphasis on the Finnish value
chain. Signicant part of world cobalt is produced
as a by-product of nickel production although cop
-
per associated by-products (DRC and Zambia) make
up the biggest share of the market. In Finland, the
association with nickel is practically always the case
and hence it is necessary to consider the coinci-
dent nickel (and copper) production that are so
typical with cobalt in Finnish deposits as well as
other associated commodities. In principle, these
other commodities (Ni, Cu and also Zn, PGE, Fe or
Au depending on the particular deposit type) may
be the main commodities and products regarding
current and potential future mines in Finland, with
minor or more substantial Co credits. More detailed
review on the features of Finnish battery mineral
deposits and their processing options is presented
in separate GTK report (Törmänen & Tuomela 2021).
Nickel is generally thought to increase its rela-
tive importance in respect of cobalt in future bat-
tery applications, but cobalt demand also grows on
absolute basis, despite the relative decreasing share
in LIB applications.
Mining is necessary for raw material sourcing
for society’s needs and provides many benets
for the areas of operations, mainly in the form of
economic and employment benets. On the other
hand, mining faces globally several challenges as
adverse environmental and societal effects may
not be always prevented. Permitting in general has
become more challenging all over the world that is
partly causing long lead times for ramping up new
mines. Public awareness of the industry’s environ-
mental performance has increased but still some
important aspects are not extensively discussed
currently. These are namely the greenhouse gas
(GHG) emission intensity and biodiversity conse-
quences, together with many societal effects that
current and upcoming sustainability and traceabil-
ity systems aim to govern and mitigate. These items
are briey discussed in this paper.
The focus of this paper, is to study the Finnish
raw material sourcing and processing options at
the ecosystem scale, covering the whole LIB value
chain up to cathode and anode materials produc-
tion. The current Finnish production and material
streams are examined, also considering the neces-
sary and widely used imported raw materials. Global
commodity markets and respective supply/demand
developments signicantly effect also the Finnish
primary raw material production. Therefore, this
report presents an overview of the current market
situation and forecasted future scenarios.
Certain raw material sourcing aspects impor-
tant to the execution of recently published Finnish
Battery Strategy are discussed. Finally, a Strategic
roadmap for the holistic ecosystem or cluster devel-
opment of Finnish battery mineral resources is
presented. This roadmap is denitely not a com-
prehensive presentation on topic but rather an
initiative for hopefully active future discussion
and development measures for this eld, both on
national level and amongst individual companies
or consortiums. It is emphasized that the ideas
and conclusions presented in chapters 2, 3 and 4
(including the roadmap and strategic development
plan) are purely by GTK and do not necessarily rep-
resent plans or thoughts of individual companies.
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Geological Survey of Finland, Open File Research Report 31/2021
Strategic roadmap for the development of Finnish battery mineral resources
1.2 Nickel and cobalt Supply/Demand scenarios
There are countless supply/demand scenarios
regarding metals and mineral commodities in
general and especially in the case of battery raw
materials. For LIB applications the following ve
commodities: cobalt, nickel, manganese, lithium
and graphite are generally considered as most
essential ones due to their importance in manu-
facturing of battery cathodes and anodes.
It can be plausibly said that the on-going Energy
Transformation and associated switch from internal
combustion engine vehicles into Electric Vehicles
(EVs, including all type of hybrid variations as well)
is the most disruptive demand side factor for the
mining & metals industry (including recycling) of
the past century. Only the tremendous, and still
continuing, growth development of China since
late 1970s can be compared with energy transfor-
mation. Energy transformation needs to be taken
into consideration together with China and other
developing economies that also constantly require
increasingly bigger metal tonnages for numer-
ous purposes. Counting all the other needs of the
Energy Transformation some other commodities,
like aluminum, copper and several REEs will play
a signicant role also besides the mentioned ve
important LIB commodities.
Many of the supply/demand scenarios are pre-
pared by companies like McKinsey, S&P Global,
Roskill etc. and are not necessarily public docu-
ments. For the purposes of this study the follow
-
ing public analyses have been utilized: Fraser et al.
2021, IEA 2020, Alves Dias et al. 2018 and Hund et
al. 2020. The outcomes of these studies have been
summarized in the following section with notes
on primary raw material production. Only nickel
and cobalt are discussed here as they are so closely
connected considering Finnish nickel-cobalt pro-
duction. The market development for these com-
modities will be an important external factor for any
future plans in Finland. This chapter mainly dis-
cusses the overall market situation. More detailed
information regarding individual countries and
mines is presented in chapter 1.3.
1.2.1 Market balance in short and long term
Nickel
Roskill sees that global primary nickel balance
would remain slightly positive for most of the
2020s, until the market will turn to deepening de-
cit starting in 2028. This decit deepens throughout
the 2030s reaching estimated 1.4 Mtpa Ni by 2040
vs. the projected supply of 3.5 Mtpa Ni (equaling
30+% decit). In case of nickel sulphate, the most
important intermediate product for LIB precursor
manufacturing, the market is forecasted to balance
at slight decit or at times surplus until 2028 with
respective deepening decit developing towards
2040 (close to 1 Mtpa NiSO
4
). For details see Figures
1 and 2. A number of uncertainty factors need to
be accounted in these analyses: for example, the
actual market share development of EVs, respec-
tive cathode chemistries, steel industry share of
Class 1 nickel, development of metal and energy
prices as well as actual ramp up of new expansions
for existing operations or completely new mines.
It is important to note that Roskill clearly predicts
that EU27 nickel supply will enter a structural and
deepening decit period after 2025, much earlier
than similar global phenomena. To ll the gap new
domestic nickel supply investments are needed and/
or signicant sourcing abroad as well as efcient
recycling. (Fraser et al. 2021)
Currently (2020) the global primary nickel supply
is roughly 2.5 Mtpa whereas it was only ca. 1.5 Mtpa
in 2000. The bulk of this huge growth has taken
place in laterite nickel mining and rening (to
big extent nickel pig iron (NPI) used by the stain-
less-steel industry), especially in Indonesia and
Philippines. These two countries are expected to
dominate the future production increase as well,
with sulphide deposits constituting only a minor
share in the future growth. The vast majority of
Chinese imported nickel is currently sourced from
Philippines, following the recent developments of
Indonesian export bans for unprocessed raw mate-
rials. (Fraser et al. 2021)
Still the Chinese companies operating in
Indonesia produce vast quantities of nickel raw
materials and NPI further transported to China.
Important conclusion in the Roskill study (Fraser
et al. 2021) is that the availability of suitable feed-
stock rather than processing capacity is the big-
gest bottleneck in the nickel sulphate supply chain,
which is the cause for the market potentially going
into a structural decit position post-2027. Also,
it is stated that Class 1 nickel metal is a signi-
cantly higher cost feedstock than that of interme-
diates such as mixed hydroxide precipitate (MHP).
Nickel sulphate production from MHP is expected
5
Geological Survey of Finland, Open File Research Report 31/2021
Pekka Tuomela, Tuomo Törmänen and Simon Michaux
to increase from 24% currently to over 42% in
2030 but again dropping in 2030s as recycling from
battery scrap is thought to increase in volumes. If
mixed sulphide precipitate (MSP) is counted, their
combined share is estimated to be close to 50% in
2030 and remains at 40% or bigger for most of the
2030s. It is apparent that MHP/MSP production is
the preferred nickel feedstock for battery raw mate-
rial sourcing for the next 10–15 years.
Fig. 1. Predicted nickel supply-demand 2020–2040. Modied after Fraser et al. 2021.
Fig. 2. Predicted nickel sulphate market balance 2020–2040. Modied after Fraser et al. 2021.
6
Geological Survey of Finland, Open File Research Report 31/2021
Strategic roadmap for the development of Finnish battery mineral resources
Cobalt
There are numerous cobalt demand/supply scenar-
ios also available. Although most likely the relative
importance of cobalt against nickel will decrease in
the future battery chemistries the absolute demand
anyhow will be growing for foreseeable future.
The estimated demand for battery applications
mostly range from 0.2 Mtpa to 0.4 Mtpa by 2030
and counting the conventional applications could
exceed 0.5 Mtpa (Alves Dias et al. 2018, IEA 2020).
Cobalt demand may increase up to 0.64 Mtpa by
2050, including all Energy transformation applica-
tions (Hund et al. 2020). The latter estimate doesn’t
include conventional cobalt applications. If maxi-
mum scenarios become reality it means more than
fourfold cobalt production by 2030 and over vefold
production by 2050 (0.14 Mtpa in 2020).
JRC (Alves Dias et al. 2018) has estimated cobalt
market decit to happen around 2024, increasing
strongly towards 2030 (Fig. 3). By 2030 the decit
is estimated to exceed 175 000 tpa that is 1.25 times
the current cobalt production in 2020. As the fore-
cast is few years old (released in 2018) the actual
production and surplus/decit situation for recent
years is also presented in Figure 3, based on USGS
(2021a) and Statista (2021) statistics as well as S&P
Global forecast for years 2021–2025 (S&P Global
2021a). For the past few years, the JRC forecast has
Fig. 3. Forecasted global cobalt supply/demand for years 2019–2030 and forecasted market surplus decit for
respective years not counting increased recycling measures. Modied after Alves Dias et al. 2018, USGS 2021a,
Statista 2021 and S&P Global 2021a.
600 000
500 000
400 000
300 000
200 000
100 000
100 000
50 000
-50 000
-100 000
-150 000
-200 000
SPGlobal actual market
surplus 2019-2020 and
forecast for 2021 to
2025
USGS/Statista
actual 2017-2020
7
Geological Survey of Finland, Open File Research Report 31/2021
Pekka Tuomela, Tuomo Törmänen and Simon Michaux
slightly underestimated the actual cobalt produc-
tion and respective slight market surplus situation.
However, the estimate is pretty similar towards
2025 as the more recent S&P Global estimate. Hence
the statement about the looming market decit
seems to be still valid. According to JRC forecast if
much higher recycling rates would be applied after
2025, the market decit could potentially be lower
but still clearly exceed 60 000 tpa by 2030. It is
remarkable that increased recycling after 2025 is
totally dependent on the available stock for the pur-
pose (spent LIBs) and also the development of more
efcient recycling techniques. The forecast has used
8 years lifetime for the EV batteries but the lifetime
may be much longer with direct effects to the stock
availability. On the other hand, the EV penetration
may also be higher than estimated, increasing the
absolute demand for cobalt. Conservative estimate
for market decit therefore would be much higher,
ranging between 60 000–175 000 tpa, the order of
magnitude being roughly the size of current global
primary cobalt production.
Cobalt market balance estimates beyond 2030s
has not been available for this study. But consid-
ering the demand forecast until 2050, it is easy to
prognose that market decit likely remains well
into 2030s despite potentially more efcient cobalt
recycling in the future.
Similar to the case for nickel feedstocks also in
case of cobalt various Intermediate cobalt products
are mainly used in the downstream processing
for different applications, including battery grade
chemicals. These intermediate products include
cobalt salts (hydroxide, carbonate and sulphate),
accounting for 56% of capacity and production,
crude cobalt oxide, cobalt alliage blanc, and cobalt
containing mattes (Alves Dias et al. 2018). For
example, Finnish cobalt rening is mainly based
on imported raw materials, the main feedstocks are
mixed hydroxide precipitates (Umicore) and cobalt
containing mattes (Nornickel).
1.2.2 Nickel-cobalt discoveries and mine
development timeframe
GTK sees that Roskill has taken rather optimistic
view for their analysis regarding new nickel produc-
ers (mines). Commonly the mine ramp-up time
-
frame has been estimated to be 13 years and 6 years
in fast track projects. These seem to be far lower
gures than global materialized averages (see chap-
ter 3.2). On the other hand, individual projects are
not dened in the study and many of the projects in
Indonesia and Philippines are expansions of current
mines that may be completed in much shorter time-
frame. Still the timeframe for a typical mine project
is signicant, globally close to 17 years on aver-
age, from the discovery of the deposit. Preceding
exploration efforts may take years or even decades
before the actual mine development can even start.
Furthermore, major nickel discoveries have
become more and more rare lately. Since 1990 there
have been 50 major discoveries globally (containing
over 500 000 tonnes of nickel in reserves, resources
and past production, in which nickel accounts for
at least 30% of the nominal value of all contained
metals). Of these only three have been discovered
during the past decade and only one of these is cur-
rently in production. The preceding decade recorded
16 discoveries of which two are currently in produc-
tion. However, none of these three producing mines
are truly signicant producers nowadays. Back in
1990s four of the discoveries out of 30+ in total have
developed to be truly major producers, currently
being in Top-30 nickel mines globally. Hence it can
be concluded that it takes easily 20–30 years to pro-
duce substantial metal supply from new discoveries.
(S&P Global 2020a). It can be expected that some of
the new deposits found during the past few decades
will be successfully brought into production phase.
Still the biggest potential regarding nickel supply
increase is with the expansion of the existing mines.
In Roskill expected mine production analysis the
share of new deposits (sulphide or laterite) is rather
low which makes sense based on the decreasing
discovery rates. However, should the development
of these projects be delayed, it would increase the
already heavy decits in the 2030s (Fraser et al.
2021). Considering the long lead times and the fact
that global major nickel discoveries have been prac-
tically negligible since 2000, the long-term supply
security does not seem to be particularly well estab
-
lished as depleting reserves should be continuously
replaced.
Cobalt will be produced in minor amounts together
with certain nickel deposits. In 2017 roughly 1/3 of
cobalt was produced from magmatic or lateritic
nickel deposits but over 60% was produced in con-
nection to copper production (Törmänen & Tuomela
2021). Therefore future cobalt supply is strongly
dependent of the development of copper mining in
DRC and Zambia. Like is the case with new nickel
mines, the amount of new cobalt producing copper
or nickel mines is limited. There are some 60 mines
8
Geological Survey of Finland, Open File Research Report 31/2021
Strategic roadmap for the development of Finnish battery mineral resources
globally that produce cobalt at least on occasional
basis and there are further 30+ projects aiming for
cobalt production, most of them being quite minor
by planned production. However just a few of these
seem to be advancing to production by 2025. Short
term supply increase from new mines appears to be
rather limited. See chapter 1.3 for more details on
individual mines and project developments.
1.2.3 Automotive stock development and
electrication
Roskill analysis assumes roughly 20–30 million
electried vehicles sold annually by 2025 depend-
ing on the scenario and respectively 25–40 million
units sold annually by 2030. Similar prognosis by
IEA (2020) predicts roughly 15–25 million electric
vehicles sold annually by 2025 and 25–45 million
units sold annually by 2030. Numerous forecasts
assume 110–120 million vehicles in total manu-
factured by 2030 so the EV penetration, counting
annual manufacturing and sales would be 20–40%
by that time. Both IEA and Roskill estimates fall
within that range. In Roskill analysis the EV per-
centage is assumed to be signicantly higher by
2040. Still even in Europe the conventional ICE vehi-
cles are predicted to make over 20% of the annual
stock at that time. This seems to be in contradiction
with the many recent very ambitious all-EV plans
released by numerous automotive manufacturers.
It is a well justied question if the raw material
sourcing allows even the gures predicted by Roskill
and IEA to be manufactured in the 2030s, consider-
ing the predicted market deciencies for nickel and
cobalt. Not to say anything about fully electried
global automotive manufacturing.
Roskill estimates nearly 2.9 Mt nickel demand
across all battery applications by 2040 of which
95% is constituted by automotive sector. By 2030
the battery demand is estimated to be roughly
1 Mtpa nickel. Cobalt demand by automotive sector
is estimated to range from 0.3 to 0.4 Mtpa by 2030
(Alves dias et al. 2018).
World Bank estimates that the planned Energy
transformation measures require nearly 2.7 Mt Ni
and 0.64 Mt Co on annual basis by 2050 (2DS or
2–degree scenario as dened by IEA). More sus-
tainable scenarios would require much higher ton-
nages, especially for metals like aluminum, copper
and zinc but also for nickel (and cobalt). (Hund et al.
2020). Third estimate is by IEA, prognosing nickel
demand of 1–2 Mtpa by 2030, depending on the
scenario (IEA 2020).
Conclusion is that actual future nickel demand
very much depends on the realized scenario. The
only clear thing is that the battery applications will
require 1–3 Mtpa nickel in the future, the order of
magnitude of current primary nickel production.
Cobalt range is similarly 0.3–0.6 Mtpa.
Comparing these gures with the current pro
-
duction for these commodities, it is more than
obvious that to meet the demand, the supply side
requires signicant investments in the future.
1.2.4 Recent NPI developments
Until 2021 it has been thought that sulphide depos-
its and respective Class 1 nickel will dominate the
battery chemicals supply side, due to simpler,
cheaper and more environmentally friendly pro-
cessing into nickel sulphate. Although it is possible
to process laterite feedstocks into battery chem-
icals, for example with so called HPAL process.
Typically, laterites and NPI production in general
cause multiple times higher CO2 emissions com-
pared with sulphide nickel processing, depending
on the process and energy source. On average the
multiplier is at least 3.5 but may be signicantly
higher, even tenfold in some cases. This naturally
has signicant LCA effects not even counting many
other aspects like biodiversity.
Tsingshan, the world’s largest nickel producer,
announced in March 2021 that it will supply nickel
matte based on converted nickel pig iron (NPI) from
its operations at Indonesia Morowali Industrial Park
(IMIP) to Chinese companies Huayou and CNGR
Advanced Materials, which will be further pro-
cessed to produce battery-grade nickel sulphate.
At the same time the company plans to signicantly
expand their nickel production with over 0.5 Mtpa
Ni by 2023 and furthermore planning for major
investments in renewable energy to mitigate the CO
2
footprint of their production processes. S&P Global
estimates that if Tsingshan’s plans are successful,
and can be scaled up to increase the availability of
feedstock for nickel sulphate production, they would
trigger the most signicant structural supply-side
change to the global nickel market since the com-
pany brought NPI to the wider market in the early
2000s. NPI share of world primary nickel produc-
tion was mere 2% back in 2006 but has grown to
exceed 40% by 2019. These latest NPI developments
9
Geological Survey of Finland, Open File Research Report 31/2021
Pekka Tuomela, Tuomo Törmänen and Simon Michaux
likely are not fully considered in the above discussed
Roskill analysis. (S&P Global 2021a)
It is good to note that without the said NPI
development during the past 15 years, the planned
Energy transformation measures would simply not
be possible from nickel supply point of view. If the
NPI production can be successfully converted to
feed the battery industry, it would relieve the sup-
ply side bottlenecks for nickel and to lesser extent
for cobalt, however at considerable environmental
cost (CO2, biodiversity etc.). At this point it is too
early to estimate if the planned NPI developments
will be successful.
Considering the early 2021 development in nickel
supply side, it seems likely that the earlier nickel
decit scenarios may be delayed at least few years,
especially in case of Class 1 nickel and associated
nickel chemical supply scenarios. Obviously, this
is to big extent subject to successful Tsingshsan
(and possibly other companies) NPI utilization for
battery grade nickel sulphate production. Even if
the pure supply challenge could be solved at least
for the short term, the long term decit seems to
be inevitable. As roughly 20% of global cobalt pro-
duction is tied with laterite nickel production, this
new NPI innovation may somewhat relief relieve
the forecasted cobalt market decit as well, sub-
ject to successful large scale implementation of the
technique.
Thinking short term, cost effectiveness and envi-
ronmental and responsibility concerns may become
the crucial items, especially the latter from OEM/
Manufacturer and end the user point of views, pos-
sibly limiting at least European companies to uti-
lize nickel and cobalt sourced from laterite nickel
deposits (regardless of the processing technique).
Supply risk considerations are also evolving due
to big changes in Southeast Asia production. Nickel
production in Philippines has been falling in recent
years. Alternatively, the production is surging in
Indonesia which may be producing 50% of global
primary nickel by 2025 (S&P Global 2021a). These
two countries would the count for over 60% of
global production by 2025 and this ratio is fore-
casted to remain in Roskill analysis (Fraser et al.
2021). Majority of this production is feeding Chinese
production (steel, batteries etc.) so despite growing
nickel production, rest of the world needs to source
their nickel as well and keep the sourcing in pace of
the growing demand.
1.2.5 Environmental and societal considerations
Typically, mining industry, like any other industry or
human activity, causes environmental consequences
and degradation of the environment. With proper
protocols, management and mitigation measures
these consequences can be minimized. During the
past few decades, the environmental performance of
the mining industry has vastly developed, especially
regarding water and waste management (acid rock
drainage management etc.) although there still is
much room for future improvements on that front.
Numerous environmental and sustainability sys-
tems and standards have evolved and are currently
in active use by the mining companies, or at least
with the public companies, responsible for their
shareholders also regarding the environmental
and social performance. Despite the many positive
developments, it has become evident that the so-
called social license to operate (SOL) is becoming
more and more difcult to achieve, regardless of the
country or mine location. This is caused by many
factors, for example conicting land use interests
or other societal challenges. These well-known
environmental aspects need not further descrip-
tion in this report. Instead a few other aspects not
so often discussed, especially in Finnish context, are
briey described in the following section. As efforts
against climate change and biodiversity losses are
nowadays seen as global phenomena that require
global actions it would appear natural to apply
this approach for resource extraction as well. Also,
societal aspects are gaining more and more impor-
tance due to increasing interest for responsible and
traceable raw material sourcing.
CO2 emission intensity
Greenhouse gas (GHG) emissions are widely dis-
cussed nowadays but not that much in connection
to mining. However, mining industry is one of the
major energy consumers globally. Actual energy
consumption and respective emissions depend on
the deposit type, applied processes, energy sourc-
ing etc. Depending on the source and extent of the
sectors covered, the industry is generally thought
to consume 2–11% of the global primary energy.
Recent estimate by McKinsey points out that min-
ing is currently responsible for 4 to 7 percent of
GHG emissions globally. Scope 1 and Scope 2 CO
2
emissions from the sector (those incurred through
mining operations and power consumption,
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Strategic roadmap for the development of Finnish battery mineral resources
respectively) amount to 1 percent, and fugitive-
methane emissions from coal mining are estimated
at 3 to 6 percent. A signicant share of global emis-
sions (28 percent) would be considered Scope 3
(indirect) emissions, including the combustion of
coal. (McKinsey 2020).
Regardless of the exact gures it is clear that
the share of global energy consumption is signi-
cant. Considering the global tendency to mine ever
lower grade deposits and increasing tonnages to
meet the growing demand combined with associ-
ated more complex process owsheets, the energy
issue is apparently even more crucial in the future
and cannot be ignored when evaluating the envi-
ronmental performance of an individual mine or
mining company.
It is widely regarded that sulphide nickel depos-
its enable much more environmentally friendly
processing, especially considering CO
2
emissions.
Terrafame has recently made an independent review
of the CO2 emission intensity of their product and
the conclusion is that Terrafame’s nickel sulphate
production offers the lowest carbon footprint in the
industry, 60% lower than existing conventional
processes Figure 4, (Terrafame 2020a): roughly 5 t
CO
2
e/t for saleable product. Most laterite deposits
easily exceed tenfold emissions. Also other nota-
ble Finnish producers belong to rst quartile in
this respect. Nornickel emissions are clearly below
10 t CO
2
e/t of saleable product, for nickel sulphate
specically 6 t CO
2
e/t of saleable product (Nornickel
2019). Boliden Kevitsa-Harjavalta integrated opera-
tions belong to the same peer group with ongoing
investments into smelter processes and mine elec-
trication further lowering the emissions (Boliden
2021a). All industrial and human activities should
target for minimum CO2 emission intensity so this
argument strongly encourages to produce commod-
ities from deposits having low emission intensity, in
this case providing the Finnish operators a competi-
tive advantage. When considering mining industry
overall climate effects also carbon handprint should
be considered besides the footprint but this topic is
not discussed further here.
Emission intensity comparisons for cobalt pro-
ducing companies are not readily available in public.
However indirectly using the statistics for nickel
compared with similar data for copper producers,
at least indicative understanding of cobalt produc-
tion emission intensity can be acquired. Glencore
is clearly the largest cobalt producer in the world,
having had 20–30% market share during the recent
years. Majority of Glencore cobalt, roughly 90%,
is produced in DRC as copper mining by-product
(Glencore 2021a). This represents nearly half of all
the cobalt produced in connection to copper mining.
Glencore reports their copper production emis-
sion intensity demonstrating that both the African
Fig. 4. Global nickel producers ranked by 2019 CO2–equivalent-intensity. Modied after Terrafame 2020a.
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Fig. 5. World copper producers greenhouse gas intensity curve (t CO
2
/t Cu produced). Modied after Glencore 2021b.
operations (Cu-Co) and the Canadian nickel-cobalt
assets are low carbon operations, belonging to
rst quartile in comparison. The company emis-
sion intensity is roughly 3 t CO
2
/t Cu (Fig. 5). The
intensity is partly affected by electricity sourcing
from hydro power (Glencore 2021b).
This demonstrates that copper ore associated
cobalt production can be undertaken with rather
low energy intensity. In general copper production
is much less energy intensive than nickel produc-
tion. Boliden has recently communicated being
able to produce very low carbon copper, based on
company’s own concentrates (including Kevitsa),
the intensity being <1.5 t CO
2
/t Cu demonstrating
the Finnish competitive edge on that front as well.
(Boliden 2021b)
Biodiversity
Global biodiversity loss has been a much-discussed
topic during the past few years, partly due to sev-
eral extensive studies undertaken on the subject, for
example by Díaz et al. (2019) and Dasgupta (2021).
Mining together with other resource extraction
sectors and other human activities contributes to
deforestation and other deteriorating consequences
causing respective biodiversity losses. Mining and
potential biodiversity loss is a fairly recent eld of
study.
Mining specically has been studied for exam-
ple by Murguía et al. 2016. They studied mines and
deposits for ve commodities (Fe, Al, Cu, Au and
Ag) and their locations in respect to global biodi-
versity zones (DZ1 to 10) by using vascular plants’
diversity as a proxy to quantify overall biodiversity.
Considering the ve metals together, 63% and 61%
of available mines and deposits, respectively, are
located in intermediate diversity zones (DZ 4 to 6),
comprising 52% of the global land terrestrial sur-
face. 23% of the mines and 20% of the ore deposits
are located in areas of high plant diversity (DZ 7
to 10), covering 17% of the land. 13% of the mines
and 19% of the deposits are in areas of low plant
diversity (DZ1 to 3), comprising 31% of the land
surface. In the used categorization Finland mainly
belongs to the diversity zone 3 with some parts on
the coast belonging to the zone 4.
Unfortunately, the study did not include key bat-
tery metals with the exception of copper. It was
concluded that 21.2% of the copper mines and
27.6% of the copper deposits are located in low
plant diversity zones, 53.4% of mines and 53.1%
of deposits in the intermediate diversity zones and
25.4% of mines and 19.3% of deposits in the high
plant diversity zones. It is to be noted, that the study
only concentrated on mine and deposit locations.
not the actual production tonnages at these sites.
It is clear that the actual production volumes and
respective footprints much effect to the biodiversity
losses.
These diversity zones are illustrated in the Figure
6, showing also the world major areas for nickel and
cobalt production. Based on latest 2019 production
gures (Brown et al. 2021) the countries located in
Southeast Asia, Australia and New Caledonia pro-
duced over 65% of global primary nickel. For cobalt
the production share is even higher, close to 80%,
mainly from Africa. Similar spatial analysis on the
exact location of these mines is not available for
comparison but in general it can be concluded that
vast majority of these mines are located in diversity
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Strategic roadmap for the development of Finnish battery mineral resources
zone 6 or higher. Mainly in Australia also diver-
sity zones 4 and 5 are well represented. However
low diversity zones do have substantial production
for both commodities, especially in Canadian and
Russian Arctic.
Therefore, the qualitative estimate is that pro-
duction of these two commodities tend to be con-
centrated on higher diversity zone areas than the
studied ve commodities, consequently placing
higher substantial biodiversity pressure on these
production regions.
Similar type of analysis was undertaken by Sonter
et al. 2018. In their study the reserves (including
both operating and non-operating assets) for lead-
zinc, copper and nickel have been mapped against
the Earths terrestrial biomes (14 biome classes). The
outcome of the study is that main tonnage for nickel
is located in biome 12 (tropical and subtropical
grasslands, savannahs and shrublands) and biome
13 (tropical and subtropical moist broadleaf forests),
see Figure 7. Also biomes 1 (boreal forests/taiga)
and 14 (tundra) possess signicant reserves and
production. Considering nickel production cobalt
credits and copper mining associated cobalt produc-
tion mainly in DRC and Zambia (mostly on biome
12), the most heavily effected biome by nickel and
cobalt mining seems to be biome 12, tropical and
subtropical grasslands, savannahs and shrublands.
Combining the outcomes of these two studies,
the conclusion is that majority of world nickel and
Fig. 6. Areas of major global cobalt and nickel mines and deposits. Main cobalt production area is shown with
dark blue square and nickel (cobalt) production areas with light blue squares. Modied after Murguía et al. 2016.
Fig. 7. Global nickel reserves and their location within 14 biomes: 1. boreal forest/taiga, 2. deserts and xeric
shrubland, 3. ooded grasslands and savannahs, 4. mangroves, 5. Mediterranean forests, woodlands and scrub,
6. montane grasslands and shrublands, 7. temperate broadleaf and mixed forests, 8. temperate conifer forests,
9. temperate grasslands, savannahs and shrublands, 10. tropical and subtropical coniferous forests, 11. tropi-
cal and subtropical dry broadleaf forests, 12. of tropical and subtropical grasslands, savannahs and shrublands,
13. tropical and subtropical moist broadleaf forests, 14. Tundra. Modied after Sonter et al. 2018.
e.g. Finnish deposits
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cobalt is produced in the areas of high or very high
biodiversity. More specically in the areas having
mostly biomes of tropical and subtropical grass-
lands, savannahs and shrublands and to lesser
extent tropical and subtropical moist broadleaf
forests, including rainforests.
Third analysis of the nickel mines and their
respective location vs. biodiversity has been under-
taken by Verisk Maplecroft (2018, Fig. 8). The study
compared the relative location of nickel reserves
by ore type (laterite or sulphide). It was found that
vast majority of the laterite deposits are located in
areas with high biodiversity (and many protected
areas as well). The study concludes: 39% of global
nickel reserves – made up entirely of laterites
are found in locations exposed to high or extreme
biodiversity risks. Verisk Biodiversity and Protected
Areas (Terrestrial) Index captures the risk to busi-
ness based on the level of species richness and the
presence of protected areas. Operations in Indonesia
and the Philippines are some of the worst-perform-
ing countries. Conversely, sulphide ores are almost
entirely low risk, since deposits are mostly found
in higher latitude and less biodiverse areas, like
Russia, Australia and Canada.
Verisk also points out the water risks associated
with mining. The large scale of laterite depos-
its means that extracting the ore produces more
wastewater than when mining sulphides. Laterite
production also requires acid leaching, consuming
Fig. 8. Global nickel production by ore type (laterite, sulphide) breakdown of reserves by ore type against the
biodiversity. Besides Finland, only South Africa, China, Australia, Russia and Canada produce substantial amounts
of sulphide based nickel. Nickel laterite deposits are located almost entirely in biodiverse and protected areas
whereas mostly higher latitude sulphide deposits are located on less biodiverse areas. Note that the biodiversity
scale is different than in the other reference studies. Modied from graphs by Verisk Maplecroft 2018.
14
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Strategic roadmap for the development of Finnish battery mineral resources
chemicals and increasing the threat to surround-
ing water quality. The Verisk subnational Water
Stress Index quanties risk by calculating the ratio
of water supply to demand. Verisk data shows that
35% of nickel reserves (26% of which are later-
ites) are at locations exposed to high or extreme
levels of water stress. This nding is driven by
the impact of large operations in the Philippines,
Indonesia and Australia – multiplying the exist-
ing water risks posed by the mining sector in these
regions. This same water stress risk is conrmed
by many other studies, for example by McKinsey
(2020). The most important mining inuenced
water-stress hot-spots by 2040 are estimated to
be Southeast and West Australia, Southern Africa,
Eastern and mid China, Central Asia, Southwest USA
and Mexico and Middle South America Pacic coast.
Finland is dened to be an area with very low water
stress risk, that can be seen as positive aspect for
the Finnish mines when considering their environ-
mental performance.
Yet another study was undertaken by Sonter et
al. 2020, the study outcome is summarized in this
section. The study analyzed 62 381 pre-operational,
operational, and closed mining properties globally
targeting 40 commodities. Also 28 409 Protected
areas, 13 320 Key Biodiversity Areas and Earth’s
Remaining Wilderness—areas free from the indus-
trial-scale activities and human pressure. For the
purposes of this study identied as the top 10%
of intact habitats (2009 Last of the Wild indica-
tor) for each of Earth’s 60 biogeographic realms
(12.12 million km2). Specic results for nickel and
cobalt properties was not disclosed but the study
included 1 917 properties for nickel and 1 012 prop-
erties for cobalt.
Assuming 50 km inuence radius (direct and
indirect effects) mining potentially inuences
50 million km2 of Earth’s land surface. This can
be thought as extremely conservative estimate,
considering the inuence area being bigger than
Americas combined. Of the dened inuence areas
8% coinciding with Protected Areas, 7% with
Key Biodiversity Areas, and 16% with Remaining
Wilderness. Using more conservative 10 km inu-
ence radius the total inuence area was dened
being 6.6 million km2 (85% of Australia area).
However, mining area proportional overlap with
specied conservation/wilderness areas changed
only slightly using these parameters. Reason for
this is not completely interpreted but may be caused
by the fact that majority of the mines with potential
to overlap these sensitive areas are located relatively
close to the borders of them, hence resulting nearly
same overlapping ratios with 10 km or 50 km inu-
ence sphere.
Furthermore, it needs to be considered that
majority of the properties analyzed are dened as
being pre-operational (mines) of which apparently
big majority are actually exploration sites. These
pre-operational properties make up 85% of the 50
km inuence radius assessment and 78% of the
10 km inuence radius assessment with respec-
tive inuence areas for remaining operational and
closed mines being ca. 26 million km
2
and 2 million
km
2
. These should be considered as true inuence
areas for mining properties, especially the latter
one. Real environmental inuences are largely
caused by these properties, with pre-operational
properties posing mostly theoretical inuences in
case of advancement into operational phase. Despite
this decit the study is comprehensive, rst of a
kind, analysis of the number and extent of explora
-
tion and mining properties.
Most mining areas (82%) target commodities
needed for renewable energy production, and areas
that overlap with Protected Areas and Remaining
Wilderness contain a greater density of mines (the
indicator of threat severity) compared to the over-
lapping mining areas that target other materials.
The study concluded that mining threats to bio-
diversity will increase as more mines target com-
modities for renewable energy production and,
without strategic planning, these new threats to
biodiversity may surpass those averted by climate
change mitigation. The outcome of this study con-
rms that mining in general tends to coincide with
nature conservation areas or otherwise high bio-
diversity value areas as well as wilderness areas.
Specic coincidence rates by individual commodi-
ties is subject to future research. (Sonter et al. 2020)
As summary of these mining-biodiversity studies
it is concluded that purely from biodiversity point
of view the unfortunate fact seems to be that these
commodities (Ni and Co) imperative for Energy
Transformation, are mostly sourced from the areas
with high or very high biodiversity and respective
biomes, potentially effecting large surface areas at
least counting also potential indirect effects. From
global perspective this favors any deposit or mines
located on lower biodiversity zone or biome, such
is the case with the Finnish peers. This is not to say
that these current or future Finnish mines would
not affect the local environment or biodiversity but
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Geological Survey of Finland, Open File Research Report 31/2021
Pekka Tuomela, Tuomo Törmänen and Simon Michaux
the effect is denitely lower than by similar mine(s)
located in higher diversity zone or biome. Obviously,
this kind of comparisons are not undertaken or
required by permitting procedures that only tend
to focus on local, national and at most regional cri-
teria, for example EU Natura2000 regulations. If
global initiatives similar to climate regulation take
place in the future, biodiversity issues are denitely
worth to consider.
Societal aspects
Various responsibility aspects have become increas-
ingly important over the past decades. Numerous
initiatives and systems have been launched to
improve stakeholder rights and verify the perfor-
mance of the companies on responsibility issues, in
many cases for example to convince the potential
investors for project funding. Most of these initia-
tives and systems are implemented globally and
therefore are not directly dependent on national
regulation. However, all the ofcial permits nec-
essary for the operations will be typically granted
based on national legislation and authorities. If the
national governance structures and democracy in
general is poorly developed, it may severely con-
straint the actual inuence potential by the local
stakeholders. Various governance and democracy
aspects inuence many other disciplines besides
the permitting and appeal procedures. Occupational
and public safety, child labour, human right viola-
tions as well as taxation transparency are just a few
examples associated with this subject. Especially in
projects where project operator is not public com-
pany and/or funding is not provided by lenders
following Equator Principle or similar responsible
nancing guidelines in their funding decisions,
there is a big risk for societal drawbacks if the
country regime is not democratic enough. This
may be the case in many Chinese operations and
investments into Philippines, Indonesia or DRC for
example that are predominant producers in these
countries.
It is not a simple task to compare countries in
that regard but various democracy indexes may pro-
vide one way to undertake a rough evaluation on
topic, as democracy index can be thought as being
a proxy for the overall governance for the institu-
tions, authorities and government in general. In this
study we refer to the Democracy Index compiled
by the Economist Intelligence Unit (EIU 2021) as
well as Fragile state index 2020 by Fund for Peace
institution (2021).
When comparing Ni and Co producing countries
discussed above in connection to CO2 emissions
and biodiversity effects, the following simpli-
ed conclusions can be done based on latest 2020
Democracy Index:
Canada (5.), Finland (6.) and Australia (9.) are
among the most democratic countries in the world
with respective ranks in the assessment, the actual
scores ranging from 9 to 9.2. Their regime type is
classied as full democracy indicating, according to
Wikipedia denition, nations where civil liberties
and fundamental political freedoms are not only
respected but also reinforced by a political culture
conducive to the thriving of democratic principles.
These nations have a valid system of governmen-
tal checks and balances, an independent judiciary
whose decisions are enforced, governments that
function adequately, and diverse and independent
media, having only limited problems in democratic
functioning.
Philippines (55.), Indonesia (64.) and Papua New
Guinea (70.) are classied as awed democracies.
Actual scores for these countries range from 6.1 to
6.6. Flawed democracies are nations where elections
are fair and free and basic civil liberties are honored
but may have issues (e.g. media freedom infringe-
ment and minor suppression of political opposition
and critics). These nations have signicant faults in
other democratic aspects, including underdeveloped
political culture, low levels of participation in poli
-
tics, and issues in the functioning of governance.
Russia (124.) and DRC (166.) are classied as
authoritarian regimes, where political pluralism is
nonexistent or severely limited. The actual scores for
these countries range from 1.1 to 3.3. These nations
may have some conventional institutions of democ-
racy but with meagre signicance, infringements
and abuses of civil liberties are commonplace, elec-
tions (if they take place) are not fair and free, the
media is often state-owned or controlled by groups
associated with the ruling regime, the judiciary is
not independent, and censorship and suppression
of governmental criticism are commonplace.
Zambia is ranked for position 99 and classied
as hybrid regime between the awed democracies
and authoritarian regimes. As stated above, together
these countries produce over 65% of global primary
nickel and close to 80% of cobalt.
Fragile state index conrms the relative position
of these countries. Finland is positioned as least
fragile of all studied countries (178., note the inverse
rank) with score 14.6. Canada is ranked 171. position
16
Geological Survey of Finland, Open File Research Report 31/2021
Strategic roadmap for the development of Finnish battery mineral resources
with score 18.7. Australia having rank 169. and score
19.7. Indonesia rank is 96. and score 67.8. Russia
rank is 76. and score 72.6. Philippines rank is 54.
and score 81. Papua New Guinea being ranked yet
slightly worse at 50. and score 82.3. Finally DRC
rank is 5. with associated score 109.4 (with maxi-
mum score for worst performer being 120).
In many mining projects the indigenous people
are among the most important stakeholders. The
indigenous people question is much more diverse
and complicated in many countries than in Finland.
For example, considering the important nickel pro-
ducing countries Philippines and Indonesia. It is
estimated that in Philippines there are approxi-
mately 6.5 million indigenous peoples, composing
about 10 percent of the total Philippine population
and belonging to over 40 distinct ethnolinguis-
tic groups. Similarly, it has been estimated that
the number of indigenous peoples in Indonesia
is between 50 and 70 million people, that makes
20–30% of the total population. With 1 072 differ-
ent ethnic groups, including 11 ethnic groups with
a population of over one million people, Indonesia
is considered one of the world’s most culturally
diverse nations. (IWGIA, ECTF 2020)
Indigenous people questions and many other land
use conicts are closely associated with the popu-
lation density. Both of these countries are much
more densely populated than Finland for example.
Philippines population density is ca. 370 people/
km2. In Indonesia the density is 150 people/km2 on
average with clearly higher densities on some of
the islands. These can be compared with average
population density in Finland, being 18 persons/km
2
and much lower in the northern and eastern parts of
Finland that are the main interest areas for explora-
tion and mining industry. (Worldometer 2021)
These gures and facts clearly emphasize the
societal challenges in these and many other coun-
tries with heavy mining industry. This brief assess-
ment unveils the position of Finland and mining
companies operating in Finland as well as relative
position for the local stakeholders, including indig-
enous people. Obviously thorough analysis should
be much more detailed but such is beyond the scope
of this study.
Many of the societal challenges are easier to
manage in full democratic countries. In the future,
when societal responsibility and traceability are
gaining increasing importance, this will likely
provide one more competitive edge for the Finnish
industry, possible even potential price premiums
depending on the developments on metal markets.
For example, London Metal Exchange has disclosed
initiatives that constrain or may even block trad-
ing of non-responsible sourced metal products in
the future (LME 2021). The counterweight for full
democracies is that NGOs and stakeholders have
much stronger relative position than in less devel-
oped democracies. This typically lengthens the
permitting and appealing procedures and makes
them more complex, on the other hand eventually
benetting the environmental performance of the
mines.
1.2.6 Finland’s contribution to EU nickel and
cobalt value chain
Finland is clearly the dominant country in all nickel
production value chain steps among EU countries
(Fig. 9). According to Fraser et al. (2021) Finland
would produce over 75% of EU primary nickel
during period 2020–2040, at most some 50 kt Ni
annually. This is somewhat conservative estimate
if certain Finnish mine projects advance as planned
and especially regarding the recent news by the
Finnish downstream rening sector, see chapter 3.
When it comes to nickel intermediates, the pre-
ferred option for nickel sulphate production, Finnish
contribution is even more highlighted at 95% over
the outlook period, see chapter 4 for respective
GTK prognosis. The same applies for Class 1 rened
nickel production dominated by Finland, also sourc
-
ing raw material for nickel production in France,
these together being close to 100% of production. In
addition, some of the Finnish Ni matte is exported
outside of EU not contributing to the tonnage here.
There are a few non-EU major producers in Europe
(mainly in UK and Norway) as well as ferronickel
producers in Balkan area. (Fraser et al. 2021)
From EU perspective it seems that without funda-
mental changes in processing or rening facilities,
Finland will remain the European powerhouse for
these value chain steps for the foreseeable future.
This clearly provides competitive advantages for
the Finnish companies that mostly rely on domes-
tic raw materials or imported from nearby sources
with substantial benets e.g. from CO
2
emissions
and biodiversity point of view as discussed earlier.
Finnish contribution on EU cobalt value chain
is even more dominant than in the case of nickel,
especially in primary production. When it comes
to cobalt primary production (mining), Finland is
the only producer in EU area. Finland is also the
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Geological Survey of Finland, Open File Research Report 31/2021
Pekka Tuomela, Tuomo Törmänen and Simon Michaux
biggest cobalt rener in Europe and EU. The only
other notable production country is Belgium in
addition to Norway. France has also produced minor
cobalt quantities in the past but in 2019 did not
produce cobalt at all. Finland, Belgium and Norway
production tonnages were 12 526 t (66% of EU
production), 6 500 t and 4 354 t respectively (Alves
Dias et al. 2018, Brown et al. 2021). However, basi-
cally all rened cobalt in Finland is sourced from
abroad. More details of Finnish value chains for
both commodities is presented in chapter 2.1.
Fig. 9. Roskill prognosis for expected EU mine supply for primary nickel 2020…2040 (topmost graph), intermediate
production (middle graph) and Class 1 nickel production (bottom graph). Note that the estimated Class 1 nickel
production in France relies on nickel matte sourced from Finland. Modied after Fraser et al. 2021.
Finnish
Production
& raw
materials
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Strategic roadmap for the development of Finnish battery mineral resources
1.3 Nickel and cobalt primary production
This chapter provides a generic breakdown of
the current nickel and cobalt production globally.
Resources or reserves and other geological aspects
are not discussed here. An overview regarding cobalt
can be obtained from the report by Törmänen and
Tuomela 2021. For nickel and other commodities
there are numerous sources for resource estimates
available, for example USGS statistics.
The aim here is to get basic understanding of
the primary nickel and cobalt production on coun-
try basis and also to present similar information
about the mine size distribution that provides bet-
ter comparison for the consequent analyses of the
Finnish deposits, mines and their future develop-
ment. Typically, the production rates are only pre-
sented on country wide aggregated numbers that
do not enable similar comparison.
Global mine production of nickel was 2.6 million
tonnes in 2019 and is estimated to be 2.5 million
tonnes of nickel in 2020 (USGS 2021b). Indonesia
is the biggest producer with the global share of
30%, and the two Asian countries Indonesia and
Philippines together produce nearly half of the
world’s nickel (Table 1). While Russia holds the
third position on the list, Finland is the biggest
producer among European countries.
Table 1. Top countries in mine production of nickel in 2020 and 2019 (USGS 2021b, Tukes 2021). Figures and
percentages do not necessarily sum up to the sharp gures due to rounding.
Country Mine production in
2020e (t Ni)
Global share (%) Mine production in
2019 (t Ni)
Global share (%)
Indonesia 760 000 30.4 853 000 32.7
Philippines 320 000 12.8 323 000 12.4
Russia 280 000 11.2 279 000 10.7
New Caledonia 200 000 8.0 208 000 8.0
Australia 170 000 6.8 159 000 6.1
Canada 150 000 6.0 181 000 6.9
China 120 000 4.8 120 000 4.6
Brazil 73 000 2.9 60 600 2.3
Cuba 49 000 2.0 49 200 1.9
Dominican Republic 47 000 1.9 56 900 2.2
Finland 41 430 1.7 38 530 1.5
United States 16 000 0.6 13 500 0.5
Other countries 248 570 9.9 271 470 10.4
TOTAL 2500 000 2610 000
e Estimation
Global mine production of cobalt was 148 000
t Co in 2018 and it is estimated to be 140 000 t Co
in 2020 (USGS 2021a). Nearly ¾ of the cobalt in
the world originates from the DRC, and the shares
of each of the next highest producing countries
(Russia, Australia, Philippines) are less than 5%
each (Table 2). The DRC produced 95 000 t Co and
all other countries together <45 000 t Co. While
Russia holds the second position on the list, Finland
is the only European country producing cobalt in
mines, its global share being 1%. The DRC’s share
in production of world’s rened cobalt is diminu-
tive (0.05% in 2018) (Brown et al. 2021), because it
exports most of the cobalt as intermediate cobalt
products, for example cobalt hydroxide, for further
rening elsewhere.
19
Geological Survey of Finland, Open File Research Report 31/2021
Pekka Tuomela, Tuomo Törmänen and Simon Michaux
Table 2. Top countries in mine production of cobalt in 2020 and 2019 (USGS 2021a, Tukes 2021). Estimate for
2020 totals for 135 000 t cobalt but is for some reason reported to be 140 000 t Co.
Country Mine production in
2020e (t Co)
Global share (%) Mine production in
2019 (t Co)
Global share (%)
DRC 95000 68.0 100000 69.4
Russia 6300 4.5 6300 4.4
Australia 5700 4.1 5740 4.0
Philippines 4 700 3.4 5 100 3.5
Cuba 3600 2.6 3800 2.6
Canada 3200 2.3 3340 2.3
Papua New Guinea 2 800 2.0 2 910 2.0
China 2 000 1.4 2 500 1.7
Morocco 1 900 1.4 2 300 1.6
South Africa 1 800 1.3 2 100 1.5
New Caledonia 11 70021.2
Finland 1 560 1.1 1 450 1.0
Madagascar 700 0.5 3 400 2.4
United States 600 0.5 500 0.4
Other countries 4840 3.5 4 870 3.4
TOTAL 140 000 144 000
e Estimation, 1 included in the other countries (in addition at least Zambia, Zimbabwe, Indonesia), 2 Brown et al. 2021.
Cobalt production gures are not as reliable as
similar gures for many other commodities. This is
partly dependent on the producing countries statis-
tical reporting and non-uniform reporting speci-
cations. For example, there is frequently disparity
between the cobalt content of the ore and cobalt
actually recovered. In addition, signicant artisa-
nal mining contribution adds up the confusion and
uncertainties.
Special feature associated with the cobalt produc-
tion is the strong artisanal and small-scale mining
(ASM) contribution in the DRC. ASM contributes a
considerable amount to the primary supply of cobalt
(Mancini et al. 2020). As a counter-measure several
large industrial giants (e.g., Glencore and Umicore)
have developed procedures to verify that ASM cobalt
and any form of child labour are excluded from
the supply chain (Umicore 2019a). The number of
artisanal copper-cobalt miners in the DRC is esti-
mated to be about 200 000. They commonly extract
cobalt from small sites located alongside large-scale
industrial operations. The relative proportion of
ASM in the DRC uctuates greatly depending on
the development of large-scale mining. In 2018,
the ASM production is reported to 18 000 tonnes
(BGR 2019). However, ASM production is expected
to decrease in 2019 compared to production in 2016
to 2018 due to the lower global cobalt prices. It is
estimated to continue to amount to 15−20% of total
production in the DRC due to the expected decline
in industrial cobalt production (BGR 2019).
Some other statistical bodies like British
Geological Survey (BGS) report signicantly lower
cobalt production gures. BGS reports 2019 produc-
tion gures being 123 000 t cobalt in total that is
clearly less than USGS gures. Biggest difference is
in DRC production that is estimated to be roughly
78 000 t by BGS and 100 000 t by USGS. For some
other countries like Australia, Canada and Cuba,
BGS reports somewhat higher gures than USGS.
(Brown et al. 2021). One can also compare the pro-
duction gures with those reported by S&P Global,
see table 9 and breakdown into mines by size.
It has been estimated that the Chinese companies
could be controlling up to 50% of the total produc-
tion in DRC (hence over 1/3 of global total supply)
and some minority stakes in Zambia. Counting both
of these, Chinese control is thought not to exceed
50% of total African production. Considering the
dominant position of DRC, the Chinese control of
20
Geological Survey of Finland, Open File Research Report 31/2021
Strategic roadmap for the development of Finnish battery mineral resources
cobalt production is signicant, especially when
considering the other commodities. In total it has
been estimated that out of total African mine pro-
duction value (2018) the Chinese control less than
7%. Globally the respective share of the total value
is estimated to be around 3%. The Chinese inves-
tors have been particularly interested in iron ore,
gold and copper, in case of DRC and Zambia copper
mines also produce cobalt as well. Cobalt is de-
nitely the commodity, where Chinese control is the
strongest. This study however misses the Chinese
control of Southeast Asian (Indonesia, Philippines)
nickel mines although they supply bulk of Chinese
nickel. The study mentions Ramu mine (Papua New
Guinea), one of the big Southeast Asian producers,
that is majority controlled by the Chinese. (Ericsson
et al. 2020)
During early the 2000s Chinese companies
started big investments into Indonesia, the big-
gest company being Tshingshan, currently the
world biggest stainless steel producer. The com-
pany operates several mines in Indonesia of which
Morowali Industrial Park is notable as being the
world rst fully integrated stainless steel indus-
trial chain, including nickel mining, NPI and fer-
rochrome smelting, stainless steel production, hot
rolling and cold rolling. Besides stainless steel the
company is also strongly contributing to the EV
value chain with nickel and cobalt, especially with
the latest innovation of producing nickel matte from
laterite ore and subsequent battery chemicals from
this new kind of feedstock. (S&P Global 2021a)
Despite the statistical irregularities it is clear
which countries are the most prominent producers.
The top 10 produci