The United States Department of Defense (DoD) is unlikely to ever be forced to count its nickels – even if some government watchdogs have sought to rein in Pentagon spending. Yet, the DoD has sought to strengthen the U.S. supply chain and agreed to provide more than $110 million in grants to miners Albermarle and Talon to increase domestic production of critical minerals including lithium and nickel.
Just last week, the Office of the Deputy Assistant Secretary of Defense for Industrial Base Resilience (IBR), through its Manufacturing Capability Expansion and Investment Prioritization (MCEIP) office, entered a $20.6 million agreement with Talon Nickel, under Defense Production Act (DPA) Title III authorities and using funds appropriated by the Additional Ukraine Supplemental Appropriations Act, to advance nickel exploration and mineral resource definition of the Tamarack Intrusive Complex (TIC).
IBR is tasked with domestic and international partners to force and sustain a robust, secure, and resilient industrial base enabling the warfighter, now and in the future. The office leads the DoD effort to identify and address supply chain/industrial base vulnerabilities, enable production in key areas through investment and innovative acquisition strategies, and manage vulnerabilities presented by adversarial capital.
Nickel: A War Metal
Though it is easy to think of the small coins that are worth just five cents, nickel is an essential mineral that is used in the production of high-temperature aerospace alloys, stainless steel, and chemicals for lithium-ion batteries. As the RAND Corp. noted, nickel is now among the six critical minerals used in lithium-ion batteries that power electric vehicles.
Today it is also crucial for military applications like jet turbine engines, which is notable as until the end of the 19th century, nickel was considered a largely “useless” metal. However, it was determined that nickel steel alloy was among the best material for armor plates for warships and later tanks, while it was also employed in the production of small arms and ordnance during World War II.
A 1954 U.S. DoD report even stated that nickel was, “the closest to being a true ‘war metal.’ It deserves first priority among materials receiving conservation attention.”
Achilles Heel for Modern Military Production
Apparently, that Pentagon recommendation wasn’t fully heeded, even as nickel has been seen as a metallic “Achilles heel” for modern military production. More recently, its use in batteries motivated a Presidential Determination qualifying it for Defense Production Act Title III funding.
“Nickel is used for numerous defense and space applications,” explained Dr. Matthew J. Schmidt, associate professor of national security and political science at the University of New Haven.
“That includes wiring on U.S. ships and it is very expensive. It is a high-end manufacturing process,” Schmidt told ClearanceJobs. “We’ve drained down our reserves and we need to ramp up production.”
Yet, as it now stands, the United States has only one operating nickel-cobalt mine with a current, publicly announced life of mine extending through 2026.
“This is yet another example of the critical importance of the DPA investment authorities,” said Anthony Di Stasio, Director for MCEIP. “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.”
This has put the statement, “if I had a nickel…” in a very new context!
Advanced Exploration System
Finding new deposits of nickel is far more complex than looking for spare change under the cushions of the couch, and the Pentagon announced that Talon had developed a proprietary suite of geophysical mapping tools, dubbed the Advanced Exploration System (AES), which allows it to rapidly identify and demonstrate economically recoverable nickel minerals.
Last year, Talon 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.
The DoD funding will support Talon Nickel’s drilling and geophysics teams to expand staff headcount, acquire additional equipment, and speed up its initiatives to discover and delineate more nickel deposits within the Midcontinent Rift geology in the country.
Per the agreement, the Pentagon will contribute $20.6 million while Talon will contribute $21.7 million.
“This funding makes clear that domestic supply of nickel is a national security priority,” Talon CEO Henri van Rooyen said in a statement.
“Congress and the Biden Administration have created powerful new tools to build up a domestic supply of critical minerals required for clean energy systems and national defense,” Rooyen added. “With this funding, Talon will be able to accelerate our efforts to discover domestic sources of battery-grade nickel and help ensure that the United States is not dependent on Russia, China, or Chinese companies operating in countries like Indonesia for nickel that is needed in both defense platforms and clean energy systems.”
Not Just Nickel
The DoD also announced that Albemarle will receive a $90m grant under the Defense Production Act (DPA) to help facilitate the expansion of domestic mining and production of lithium, and it will use the proceeds to buy a fleet of mining equipment for the restart of its lithium mine in Kings Mountain, North Carolina.
The area is believed to contain hard rock lithium deposits and is expected to feed sufficient material for a lithium carbonate equivalent (LCE) conversion capacity of 50 kilotonnes. This will be sufficient for the production of 1.2 million electric vehicles a year, the industry trade magazine Mining-Technology reported.
“The lithium find is going to be huge for the United States,” added Schmidt.
The firm could begin operations by late 2026, and it now implementing the initiative for responsible mining assurance (IRMA)-ready standards with an emphasis on environmental stewardship and community engagement.
“As one of the only U.S.-based lithium companies to carry out lithium extraction, processing and novel lithium battery material research in the United States, Albemarle is uniquely positioned to help power the clean energy revolution,” said Eric Norrism, president of Albemarle. “Lithium is an essential ingredient in our sustainable energy future. Demand is expected to increase significantly, and it is imperative to secure our nation’s supply of this critical resource.”