It could be a new kind of “gold rush” in the West with the motherlode found in Oregon. A precious metal deposit that could be worth hundreds of billions of dollars.
Exploratory drilling has been going on in the far southeast corner of the state on the Oregon-Nevada border for the last three years. What drillers are looking for in the McDermitt Caldera is not actually gold.
It’s lithium.
McDermitt, Nevada, is just a few hundred yards over the Oregon border. Population: 95. A shrinking dot on the high desert map. For the last century, a boom and bust mining town straddling two-lane U.S. Highway 95.
One casino, two gas stations, long dead businesses and home to the North American headquarters of Jindalee Resources of Perth, Australia.
“Ha! There’s a lot more drilling to be done,” said Lindsay Dudfield, Executive Director for Jindalee. “We’ll be drilling here for a lot more years.”
Lithium is what drew the mineral exploration company to McDermitt. Why are they looking for it? Look around your home for the answer and you’ll probably find it.
What is lithium?
Lithium is a key component in cellphones, laptops and solar and wind power storage systems. All kinds of electronics, including lithium-ion batteries that power electric cars.
Even with demand surging, the country has just one small lithium mine operating in Southern Nevada. The biggest deposits of the world’s lightest metal are in Chila, Argentina, Australia and China.
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Most lithium mined globally is shipped to China, where it is refined and sold back to the rest of the world.
All of which brings us to southeastern Oregon’s spectacular emptiness.
In a late Spring snow squall, we drive into the 16-million-year-old McDermitt Caldera, looking for evidence of the 29 drill holes already sunk by Jindalee.
“This is a pioneering part of the exploration cycle,” said Dudfield.
It’s the first lithium drilling operation of this scale ever permitted in the State of Oregon. It doesn’t look like much — just a metal cap in the mud. But it’s a hint of what could be the biggest, most accessible deposit in North America. Dudfield has called it “a monster.”
“Well, look. We wouldn’t be coming back and doing more work if we didn’t like what we’re seeing,” said Dudfied.
They’ll sink a total of 61 drill holes on more than 7,000 acres — about half the area of their staked mining claim.
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Dudfield stresses Jindalee is always trying to disturb the land as little as possible, to replant and repair around drilling sites.
“We’re currently undertaking flora and fauna surveys, hydrological surveys, cultural surveys just to make sure we minimize our impact on areas that might be sensitive,” said Dudfied.
Another thing he stresses, repeatedly, is that Jindalee is looking — not digging.
“This is exploration. There is no guarantee a mining operation will result,” said Dudfield.
But there’s also no guarantee it won’t.
“Obviously, if our exploration is successful and all other stars align, the lithium price remains high, we have support from the community and government support for developing a mine here then, yes, that’s the ultimate goal,” said Dudfield.
Environmental concerns with lithium mining
Ryan Houston with the Bend-based conservation group Oregon Natural Desert Association says they’ll keep Jindalee’s work under a microscope for years.
“Given that this has the potential to be North America’s largest lithium mine, we’re going to be watching it very closely and most importantly we’re going to be focused on making sure there is clear and explicit compliance with those bedrock conservation laws,” said Houston.
He’s hoping a balance can be found between lithium demand and damage to the land.
“How do we develop these critical minerals and do it in a way that protects some of the key things we care about, biodiversity and wild landscapes,” said Houston.
Environmental groups aren’t the only ones keeping a wary eye on the drilling.
Ranchers keeping a close eye
The Black Angus cattle grazing on federal land near the drilling sites belong to G.J. Livestock — Fred and Judy Wilkinson’s operation.
“There once was 17 family ranches in this valley on the Oregon side. There’s only two of us left,” said Fred.
Despite Jindalee’s assurances, the Wilkinsons are skeptical about promises made.
“When those drill rigs and stuff come in here, those guys don’t care how much grass they destroy or what happens,” said Fred. “They try to plant it back, and they’re supposed to. But the (Bureau of Land Management) has a tough time keeping after them.”
Judy doubts her great-grandson Westyn’s generation will ever work this country, especially if this becomes the lithium mining capital of the continent.
“Some things come to an end,” said Judy. “Sometimes you are better off to move on, find a place somewhere else to raise cattle, maybe more private property and less government ground, less issues to deal with.”
Dudfield expects pushback, regulatory challenges and a long, bumpy road to any mining operation here. It’s an area where mineral extraction has been changing the landscape for a century, such as a mercury mine that closed in 1990.
“Lithium is mined. It doesn’t fall out of the sky as snow,” said Dudfield. “If people want mobile phones; they want electric vehicles; they want to be able to store “green energy” so that when the sun’s not shining or the winds not blowing’ they still have electricity, then they’re going to need lithium-ion batteries.
Fred Wilkinson understands the dynamic, but also understands there are choices that have to be made.
“Yeah, this is important — the cell phone. But are we going to eat the cell phone? People don’t even think about eating. That’s the thing. And I know they never will until they get hungry,” said Fred.
There’s no drilling now. Jindalee is leaving the land alone during prime cattle grazing months. But those drill crews will be back at work in September.
If it ever happens, full-scale mining could still be ten years out.
Exactly how much could it be worth? That’s impossible to calculate. There are just so many variables to factor in.
Using figures Jindalee Resources Limited has made public and an average long-term contract price for a metric ton of lithium carbonate, the deposit could be — and we need to stress these are our calculations, not Jindalee’s — $200 billion to $300 billion. To be clear, Jindalee has not made that kind of prediction about potential value.
