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Surging mineral demand threatens energy transition, supply challenges ahead

Oil&Gas Materials 8 June 2023 14:36 (UTC +04:00)
Laman Zeynalova
Laman Zeynalova
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BAKU, Azerbaijan, June 8. As the world embraces the energy transition, the demand for minerals crucial to its success is projected to undergo a significant surge, Trend reports.

However, challenges in supply, geopolitics, specialized supply chains, price fluctuations, and environmental, social, and governance issues are poised to complicate the future availability of these essential minerals.

Under the Walls scenario of Norway’s Equinor, which reflects current trends, the demand for minerals is expected to double by the early 2030s compared to the average annual demand from 2016 to 2020. Meanwhile, the Bridges scenario anticipates demand peaking around 2035, followed by a gradual decline towards 2040 due to improvements in mineral intensity and a slowdown in new capacity additions.

The supply of minerals necessary for the energy transition is increasingly at risk due to a variety of factors. Geopolitical dynamics, complex supply chains, price hikes, and concerns regarding environmental and social impacts all pose challenges to future mineral availability. In this context, innovation will play a pivotal role in securing future mineral reserves and alleviating demand for those facing shortages or ethical dilemmas.

Furthermore, current levels of mineral production are insufficient to meet the projected future demand. Both the Walls and Bridges scenarios reveal that the growing demand for certain minerals will strain supply chains, with future annual demand surpassing current production levels. Balancing future mineral demand and supply will require a substantial increase in production or innovative solutions to reduce demand.

Addressing the mineral supply challenge is of utmost importance for the success of the energy transition. Collaborative efforts involving industry, governments, and innovators will be crucial in developing sustainable solutions to ensure a steady and ethical supply of minerals, enabling the smooth progress of the global energy transition towards a more sustainable future.

Follow the author on Twitter: @Lyaman_Zeyn

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