[Senate Hearing 116-322]
[From the U.S. Government Publishing Office]





                                                        S. Hrg. 116-322
 
     THE IMPORTANCE OF AND PATH TO ACHIEVING MINERAL SECURITY, AND 
                            CONSIDERATION OF
  S. 1052, THE RARE EARTH ELEMENT ADVANCED COAL TECHNOLOGIES ACT, AND
               S. 1317, THE AMERICAN MINERAL SECURITY ACT

=======================================================================

                                HEARING

                               BEFORE THE

                              COMMITTEE ON
                      ENERGY AND NATURAL RESOURCES
                          UNITED STATES SENATE

                     ONE HUNDRED SIXTEENTH CONGRESS

                             FIRST SESSION

                               __________

                              MAY 14, 2019

                               __________


                       Printed for the use of the
               Committee on Energy and Natural Resources

        Available via the World Wide Web: http://www.govinfo.gov
        
        
        
                            ______                       


              U.S. GOVERNMENT PUBLISHING OFFICE 
37-305 PDF             WASHINGTON : 2021        
        
        
        
               COMMITTEE ON ENERGY AND NATURAL RESOURCES

                    LISA MURKOWSKI, Alaska, Chairman
JOHN BARRASSO, Wyoming               JOE MANCHIN III, West Virginia
JAMES E. RISCH, Idaho                RON WYDEN, Oregon
MIKE LEE, Utah                       MARIA CANTWELL, Washington
STEVE DAINES, Montana                BERNARD SANDERS, Vermont
BILL CASSIDY, Louisiana              DEBBIE STABENOW, Michigan
CORY GARDNER, Colorado               MARTIN HEINRICH, New Mexico
CINDY HYDE-SMITH, Mississippi        MAZIE K. HIRONO, Hawaii
MARTHA McSALLY, Arizona              ANGUS S. KING, JR., Maine
LAMAR ALEXANDER, Tennessee           CATHERINE CORTEZ MASTO, Nevada
JOHN HOEVEN, North Dakota

                      Brian Hughes, Staff Director
                     Kellie Donnelly, Chief Counsel
             Lane Dickson, Senior Professional Staff Member
                Annie Hoefler, Professional Staff Member
                Sarah Venuto, Democratic Staff Director
                Sam E. Fowler, Democratic Chief Counsel
          Elliot Howard, Democratic Professional Staff Member
          
                            C O N T E N T S

                              ----------                              

                           OPENING STATEMENTS

                                                                   Page
Murkowski, Hon. Lisa, Chairman and a U.S. Senator from Alaska....     1
Manchin III, Hon. Joe, Ranking Member and a U.S. Senator from 
  West Virginia..................................................     3

                               WITNESSES

Balash, Hon. Joseph, Assistant Secretary for Land and Minerals 
  Management, U.S. Department of the Interior....................     5
Solan, Dr. David, Deputy Assistant Secretary for Renewable Power, 
  Office of Energy Efficiency & Renewable Energy, U.S. Department 
  of Energy......................................................    11
Evans, Jonathan, President and Chief Operating Officer, Lithium 
  Americas Corporation...........................................    20
Warner, Dr. John, Chairman, National Alliance for Advanced 
  Technology Batteries, and Chief Customer Officer, American 
  Battery Solutions..............................................    27
Ziemkiewicz, Dr. Paul, Director, Water Research Institute, West 
  Virginia University............................................    35

          ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED

American Air Liquide Holdings, Inc.:
    Letter for the Record........................................    85
Balash, Hon. Joseph:
    Opening Statement............................................     5
    Written Testimony............................................     7
    Responses to Questions for the Record........................    67
Evans, Jonathan:
    Opening Statement............................................    20
    Written Testimony............................................    23
    Responses to Questions for the Record........................    81
Manchin III, Hon. Joe:
    Opening Statement............................................     3
Murkowski, Hon. Lisa:
    Opening Statement............................................     1
Solan, Dr. David:
    Opening Statement............................................    11
    Written Testimony............................................    13
    Responses to Questions for the Record........................    73
Umicore USA:
    Statement for the Record.....................................    89
Warner, Dr. John:
    Opening Statement............................................    27
    Written Testimony............................................    29
    Responses to Questions for the Record........................    82
(The) Wilderness Society:
    Statement for the Record.....................................    96
Women's Mining Coalition:
    Letter for the Record........................................    98
Ziemkiewicz, Dr. Paul:
    Opening Statement............................................    35
    Written Testimony............................................    37
    Responses to Questions for the Record........................    84


     THE IMPORTANCE OF AND PATH TO ACHIEVING MINERAL SECURITY, AND 
    CONSIDERATION OF S. 1052, THE RARE EARTH ELEMENT ADVANCED COAL 
    TECHNOLOGIES ACT, AND S. 1317, THE AMERICAN MINERAL SECURITY ACT

                              ----------                              


                         TUESDAY, MAY 14, 2019

                                       U.S. Senate,
                 Committee on Energy and Natural Resources,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:04 a.m. in 
Room SD-366, Dirksen Senate Office Building, Hon. Lisa 
Murkowski, Chairman of the Committee, presiding.

           OPENING STATEMENT OF HON. LISA MURKOWSKI, 
                    U.S. SENATOR FROM ALASKA

    The Chairman. Good morning, everyone. The Committee will 
come to order.
    Thank you for joining us here this morning.
    We are here to consider ways to strengthen our nation's 
mineral security. In many ways this is a little bit of deja vu 
all over again. By my count, this is the seventh hearing that 
we have held on this issue since I have been on this Committee. 
That is a lot of hearings.
    I wish that I could say that we are further along now than 
we were when we began. We are going to get it done. Over the 
course of several years, we have repeatedly heard from 
witnesses who have underscored our vulnerability in relying on 
foreign nations for the minerals used to keep our economy 
strong and our nation safe.
    In 1997, we imported 100 percent of 11 different minerals 
and 50 percent or more of another 26. Now, a little over 20 
years later, our dependence has almost doubled. So we are going 
in the wrong direction. According to the USGS, last year we 
imported at least 50 percent of 48 minerals, including 100 
percent of 18 of them.
    The concentration of that supply, who we buy it from, is 
also a problem. Of the 48 minerals that I mentioned, China is a 
primary supplier for 26 of them. China is actually mentioned 
375 times in the USGS 204-page mineral commodities summary 
report--they get the front page there.
    Of course, this issue is not limited to the sourcing of raw 
minerals. China is also monopolizing other aspects of the 
supply chain, including the technology used to process and 
refine minerals.
    So why is this a problem? Whether we realize it or not, 
minerals are the foundation of our modern society. We use them 
in just about everything. But our foreign dependence threatens 
our national security and is driving jobs and industries, 
whether electronics or electric vehicles or something else, to 
other countries. Our foreign mineral dependence is our 
Achilles' heel for competitiveness, for manufacturing, and for 
geopolitics. And in my view, it is way past time that we seek 
to address it.
    I do appreciate the steps that President Trump has taken, 
including his Executive Order to identify a list of critical 
minerals and to develop a ``whole of government'' strategy to 
reduce our foreign dependence. I look forward to their policy 
recommendations, which I understand should be released any day 
now.
    The Administration's actions are important, but they are 
not enough, and Congress needs to complement them with 
legislation. That is why Ranking Member Manchin and I have put 
forth two legislative proposals: S. 1317, which is my American 
Mineral Security Act, and S. 1052, the Ranking Member's Rare 
Earth Element Advanced Coal Technologies, or ``REEACT,'' Act. 
You get the prize for the better acronym. I just don't deal 
with the acronyms, but REEACT--it is good.
    Senator Manchin. We hired a person for that.
    The Chairman. Yes, you probably did.
    [Laughter.]
    Maybe I need to borrow them.
    The American Mineral Security Act takes a comprehensive 
approach to rebuilding our mineral supply chain. It directs 
multiple departments to evaluate and update a list of critical 
minerals every three years and to conduct geological 
assessments to determine where deposits are located. It 
authorizes R&D to promote recycling and the development of 
alternatives, forecasting so we can better anticipate supply 
and demand and workforce development to ensure that we have 
qualified professionals operating at the highest standards in 
the world. Our legislation also takes modest steps to provide 
predictability to the federal permitting process, which of 
course we know is notoriously slow and bureaucratic. It can 
take seven to ten years to finish permitting here in the United 
States. We should all be able to agree that it is very hard to 
compete for capital and investment when other nations take a 
much shorter period of time, as little as two to three years, 
to finish permitting.
    While my legislation provides a good framework to begin 
understanding and addressing our foreign mineral dependence, I 
think that there is more that we can do, and I look forward to 
working with my colleagues to ensure a robust domestic 
industry, one that continues to be held to the highest 
environmental and labor standards in the world, and to building 
the workforce and infrastructure needed to bring downstream 
processing and manufacturing back to the States.
    I hope that this is finally the year that Congress will 
work together to advance bipartisan legislation that will help 
rebuild our mineral supply chain.
    I want to thank you, Senator Manchin, Senator McSally, 
Senator Sullivan and Senator Cramer for cosponsoring my 
legislation. I would ask other members of the Committee to take 
a look at it and consider signing on.
    I thank our witnesses for being here this morning. I 
appreciate you, Mr. Balash, being here as a great Alaskan, 
being able to share your expertise from that perspective, but 
also from within the Department. So we thank you for that.
    Senator Manchin, your comments this morning as we kick 
things off.

               STATEMENT OF HON. JOE MANCHIN III,
                U.S. SENATOR FROM WEST VIRGINIA

    Senator Manchin. Thank you, Madam Chairman, for calling the 
hearing to discuss this most important topic which you and I 
both feel strongly about because we have two pieces of 
legislation which we are trying to move the dime, if you will.
    I want to thank all the witnesses who have made an effort 
to be here. I am pleased to have from my home state, Dr. 
Ziemkiewicz, here to show the good work he is doing as Director 
of the West Virginia Water Research Institute at West Virginia 
University.
    Today we are hearing testimony on two bills that take 
different, yet important, steps to help address our concerning 
dependence on foreign sources of critical minerals. I believe 
this Administration is taking some important steps to identify 
minerals considered essential to our economic and national 
security, but that are also vulnerable to potential disruption 
in the global supply chain. However, there is a great amount of 
work that needs to be done.
    Not all minerals are created equal. Rare earth elements are 
among the critical commodities I would like to draw special 
attention to. Right now, we are about 100 percent dependent on 
China for these commodities which the Chairman has identified 
which are needed for our advanced defense systems and other 
pieces of equipment used on the front lines, not to mention 
countless consumer products.
    As a member of the Senate Armed Services Committee, I 
believe that the men and women in our Armed Forces deserve 
nothing but the best, and the fact that China maintains a near 
monopoly on the critical components needed for our defense 
system makes no sense to me at all--and I am sure it doesn't to 
you either.
    We did not arrive in this vulnerable position overnight. In 
fact, it was decades in the making and the result of both a 
commitment from China to lead the world in this area and an 
unforeseen consequence of classifying thorium as a source of 
nuclear fuel by the International Atomic Energy Agency in 1980. 
This is obviously a simplification of a complex set of issues 
but the fact of the matter is that, since then, China has 
continued to invest in the entire rare earth supply chain both 
inside and outside of its borders and has successfully created 
an artificial market that locks in and maintains access to rare 
earth metals, alloys, magnets and other post-oxide materials.
    I believe if we are serious about breaking China's grip, we 
must not only focus on the importance of rare earth mining, but 
also on the entire rare earth supply chain because right now, 
China alone has the capacity to refine and convert rare earths 
into metals. In other words, we need to recover the resources 
as well as establish an industrial base that is capable of 
processing and converting these minerals into metals we need 
for our defense and our consumer products. That is far 
preferable to what we are currently doing which is shipping 
them to China for processing. I am glad to report this is 
exactly what the team at the West Virginia University and NETL 
are doing today.
    The commercialization of advanced separation technologies 
for rare earth elements from coal and coal by-products is the 
first step. Acid mine drainage (AMD) from abandoned mine coal 
mines, possess a lingering challenge to Appalachian states like 
West Virginia. Existing coal mine operations require water 
treatment at the source; however, when this is done it creates 
AMD sludge as a by-product.
    Dr. Ziemkiewicz and his team have sampled and classified 
hundreds of deposits of AMD sludge from all across the region 
and have found it contains heavy deposits of rare earths. They 
have partnered with the National Energy Technology Lab in 
Morgantown to continue working toward commercializing the 
technology to separate rare earths from AMD sludge. In other 
words, they are working to turn unwanted waste into valuable 
resources as well as convert minerals recovered from the 
process into metals.
    This is a process that is overall relatively benign for the 
environment. If successful, Appalachia's coal sludge could 
produce up to 800 tons of these elements each year, worth more 
than $190 million. This offers a potential win for the 
environment, a win for the state and a win for the national 
security interests of our nation.
    I introduced the Rare Earth Element Advanced Coal 
Technologies, or REEACT, to ensure NETL's rare earth program 
that has the funds necessary to bring our investment to 
fruition. Great progress has been made, including a new pilot 
scale facility which opened in Morgantown last year.
    I am also an original co-sponsor of the Chairman's bill, 
the American Mineral Security Act, which I believe offers a 
well-crafted approach toward addressing gaps across the entire 
domestic critical mineral supply chain. In particular, the 
American Mineral Security Act will help find ways to address 
our shortcomings in the critical minerals workforce in which we 
are drastically behind other countries. It also requires 
resource assessments and authorizes the Department of Energy to 
conduct research and development for recycling and alternatives 
for critical minerals, a key component to improving 
efficiencies of critical minerals and breaking China's 
stronghold.
    Together, the American Mineral Security Act and the Rare 
Earth Element Advanced Coal Technologies Act, when implemented 
will help to move the needle in the right direction for our 
critical mineral dependence and our national and economic well-
being.
    I am pleased we are receiving testimony on these important 
bills today, and I look forward to discussing this issue and 
hearing from our panel of witnesses.
    Thank you for being here, and thank you, Madam Chairman, 
for calling this hearing.
    The Chairman. Thank you, Senator Manchin.
    We will now begin with our panel.
    I mentioned that we are joined by the Honorable Joe Balash, 
who is the Assistant Secretary for Land and Minerals Management 
at the U.S. Department of the Interior (DOI). We appreciate 
your leadership over there and being here this morning.
    We are also joined by Dr. David Solan, who is the Deputy 
Assistant Secretary for Renewable Power at the Office of Energy 
Efficiency and Renewable Energy (EERE) over at the Department 
of Energy (DOE). Thank you.
    Mr. Jonathan Evans is the President and COO for Lithium 
Americas. Welcome to the Committee.
    Dr. John Warner is the Chairman for the National Alliance 
for Advanced Transportation Batteries and the Chief Customer 
Officer for American Battery Solutions. Welcome.
    And Dr. Ziemkiewicz has been introduced by Senator Manchin. 
He is the Director for the West Virginia Water Research 
Institute at West Virginia University.
    We welcome all of you. We thank you for giving us your time 
this morning.
    Assistant Secretary Balash, if you would like to lead off. 
We would ask that you try to keep your comments to about five 
minutes. Your full statements will be included as part of the 
record.
    I will note that we are scheduled to have two votes that 
are supposed to begin at 10:45 this morning, so my hope is that 
we will be able to get through everyone's testimony, maybe take 
a quick break for those votes and then be back.
    With that, Mr. Balash.

 STATEMENT OF HON. JOSEPH BALASH, ASSISTANT SECRETARY FOR LAND 
    AND MINERALS MANAGEMENT, U.S. DEPARTMENT OF THE INTERIOR

    Mr. Balash. Good morning, Chairman Murkowski, Ranking 
Member Manchin and members of the Committee. I'm Joe Balash, 
the Assistant Secretary for Land and Minerals Management for 
the Department of the Interior.
    Thank you for the opportunity to discuss the Department of 
the Interior's development and management of critical minerals 
and on S. 1317, the American Mineral Security Act.
    The Department appreciates the Chairman and the Ranking 
Member's recognition of the great importance of critical 
minerals, and we're grateful for the hard work that's been done 
to draft this legislation. We look forward to working with you 
on the bill as it moves forward.
    The United States has an extraordinary abundance of mineral 
resources, both onshore and offshore, and is a major mineral 
producer. In 2018, the USGS estimated the total value of non-
fuel domestic mineral resources produced to be $82.2 billion. 
The United States, however, relies on other countries for more 
than 50 percent of dozens of minerals that are vital to our 
economy and security. In 2018 the country was 100 percent net 
import-reliant for 18 minerals as shown on this chart, one that 
I think you're fairly familiar with.
    Critical minerals are those that are essential to the 
economic prosperity and national security of the United States 
and have a supply chain vulnerable to disruption. Of the 18 
mineral commodities for which the United States is 100 percent 
import-reliant, 14 of them have been identified as critical 
minerals by the USGS. These critical minerals are used in an 
increasingly broad range of high-tech applications. For 
example, antimony, cobalt and natural graphite are important 
for advanced batteries and electric vehicles, or germanium and 
gallium which are essential in the production of night vision 
goggles and other optical instruments that are important for 
national security.
    To address this vulnerability, in 2017 the President issued 
Executive Order 13817, which called on agencies across the 
Federal Government to organize a strategy to reduce the 
nation's susceptibility to critical mineral supply disruptions. 
In 2018, as part of the implementation of the Presidential 
Order, the Department developed and published a list of 35 
critical minerals.
    The critical mineral list is a part of the foundation of 
the strategy report which will identify a number of actions 
that the Department will take. The Department has already 
committed to a number of activities, including having the USGS 
and the Bureau of Ocean Energy Management expand geologic 
mapping using cutting-edge technology which will be essential 
to assess our critical mineral resource potential and 
conducting a review of permitting processes on federal public 
lands.
    Additionally, the Administration has made environmentally 
responsible development of all domestic sources of energy and 
minerals a priority through issuing Executive Order 13783. The 
Department and other federal agencies were called upon to 
increase access and reduce the burden on energy and mineral 
development of public lands as part of the implementation of 
this order. This includes renewable energy development which is 
heavily reliant on critical minerals. Also, as part of this 
effort, the Department focused on increasing efficiencies and 
streamlining environmental reviews which includes setting page 
and time limit goals on all National Environmental Policy Act 
(NEPA) analysis.
    S. 1317 would require the Department to develop and 
maintain a list of minerals critical to the economic prosperity 
and national security of the United States and to improve the 
process of locating, developing and using those critical 
minerals. The bill includes several reporting requirements 
including one for an annual critical mineral forecast from the 
USGS and the Energy Information Agency. The Department supports 
these efforts as they align with the ongoing efforts by the 
Administration to promote mineral development. The Department 
also supports the reauthorization of the National Geologic and 
Geophysical Data Preservation Program at USGS. The Department 
looks forward to continuing to work with the sponsors on this 
important legislation.
    Thank you again for this opportunity to present this 
testimony. The Department is committed to promoting 
domestically sourced critical minerals. Doing so will create 
and sustain jobs, promote U.S. technological innovation and 
reduce our nation's vulnerability to disruptions in the 
critical mineral supply chain.
    I'd be happy to answer questions at the appropriate time.
    [The prepared statement of Mr. Balash follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]     
        
    The Chairman. Thank you, Assistant Secretary. We appreciate 
that.
    Dr. Solan, welcome.

 STATEMENT OF DR. DAVID SOLAN, DEPUTY ASSISTANT SECRETARY FOR 
               RENEWABLE POWER, OFFICE OF ENERGY 
    EFFICIENCY & RENEWABLE ENERGY, U.S. DEPARTMENT OF ENERGY

    Dr. Solan. Chairman Murkowski, Ranking Member Manchin and 
members of the Committee, thank you for the opportunity to 
testify today on behalf of the Department of Energy, and thank 
you for your continuing leadership and interest in critical 
minerals and materials.
    The Department shares the goals of S. 1317, Chairman 
Murkowski's American Mineral Security Act, and S. 1052, Ranking 
Member Manchin's REEACT Act. DOE also appreciates the bill's 
recognition of program and laboratory capabilities in 
developing replacements for critical materials as well as 
improvements in the recycling, processing, extraction and 
recovery.
    Critical minerals are used in many products important to 
the U.S. economy and national security, and they are 
particularly important to the most innovative clean energy 
technologies. For example, some of the minerals DOE considers 
the most critical in terms of supply risk include gallium for 
LEDs, the rare earths dysprosium and neodymium for permanent 
magnets and wind turbines and electric vehicles and cobalt and 
lithium for electric vehicle and grid batteries.
    The U.S. is dependent on foreign sources of many critical 
minerals, and we also currently lack the domestic capability 
for downstream processing of materials as well as the 
manufacture of some products made from them.
    Today I would like to highlight how DOE is working to 
address these vulnerabilities through our R&D and how we work 
closely together with our federal partners through interagency 
coordination. DOE has a three-pillared approach to our R&D 
investments for critical materials coordinated among our 
programs agency-wide. The three pillars are: (1) diversifying 
their supply--including domestic production, (2) developing 
substitutes, and (3) alternatives and recycling of use and more 
efficient use of them. And I would note that these pillars 
align very well with the bills that are being discussed today.
    Possibly the most well-known of DOE's work is that of the 
Critical Materials Institute which appeared before this 
Committee last July. The Critical Materials Institute (CMI) is 
a multi-disciplinary consortium of national laboratories, 
universities and companies led by the Office of Sciences, Ames 
Laboratory, and managed by Energy Efficiency and Renewable 
Energy's Advanced Manufacturing Office.
    Some technologies developed and licensed through CMI that 
exemplify DOE's three-pillared approach include a membrane 
solvent extraction for rare earth separations which is relevant 
to both primary production and recycling, the 3D printing of 
rare earth magnets to reduce waste, and the development of a 
cerium-aluminum alloy for creating lightweight components for 
vehicles and airplanes.
    Much of the Department's advancements in any applied area 
such as critical materials are underpinned by our Office of 
Science which focuses on fundamental research to advance 
understanding of materials at the atomic scale. Its research 
employs novel synthesis techniques and computation 
identification of compounds for critical materials substitutes. 
This includes replacements for rare earths and magnets, lithium 
and cobalt in batteries and platinum in catalytic reactions.
    In a similar vein to reduce dependence of batteries on 
critical materials, the Vehicle Technologies Office (VTO) at 
EERE is funding R&D to reduce the cobalt content in the battery 
cathode to less than five percent by weight. VTO has also 
established the ReCell Lithium Battery Recycling R&D Center at 
Argonne National Laboratory for current and future battery 
chemistries. And in January 2019, VTO and the Advanced 
Manufacturing Office announced the launch of the Lithium-Ion 
Battery Recycling Prize to incent American entrepreneurs to 
create cost-effective solutions to get to 90 percent of 
lithium-ion batteries to be recycled.
    The Office of Electricity at DOE is funding efforts to 
develop non-lithium grid energy storage based on earth-abundant 
materials such as sodium and zinc with a goal of $100 per 
kilowatt-hour.
    Additionally, the Department is pursuing unconventional 
resources to recover or harvest critical materials. Through the 
National Energy Technology Laboratory, the Office of Fossil 
Energy is focused on recovering rare earth elements from coal 
and coal-based resources, a subject of Ranking Member Manchin's 
bill. These efforts grew to 30 projects in the past year.
    EERE is also working on unconventional resources through 
small business innovation research grants continuing to invest 
in the recovery of lithium in geothermal brines, and it is also 
investing in technologies to use marine and hydro-kinetic power 
to possibly extract critical materials from seawater.
    ARPA-E and a number of offices within EERE, including the 
Wind Technologies Office, have had significant complementary 
efforts to develop alternative motor and generator technologies 
that do not require rare earth permanent magnets.
    And finally, the Department closely coordinates with other 
federal agencies such as the Departments of Defense, Commerce 
and Interior through the National Science and Technology 
Council Subcommittee on Critical Minerals. As a co-chair since 
2013, DOE continues to provide leadership and we have worked 
closely with the Department of Commerce as it leads to the 
final preparation of a report in response to the President's 
December 2017 Executive Order 13817 which will help define a 
national strategy to address critical minerals.
    Thank you again for the opportunity to appear here today. 
DOE looks forward to working with the Committee and Congress to 
ensure appropriate stewardship and results from taxpayer 
investments, and I look forward to your questions.
    Thank you.
    [The prepared statement of Dr. Solan follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]     
        
    The Chairman. Thank you, Dr. Solan.
    Mr. Evans, welcome.

  STATEMENT OF JONATHAN EVANS, PRESIDENT AND CHIEF OPERATING 
             OFFICER, LITHIUM AMERICAS CORPORATION

    Mr. Evans. Madam Chairman, Senator Manchin, members of the 
Committee, my name is Jonathan Evans and I'm the President for 
Lithium Americas Corporation.
    I greatly appreciate your focus on critical minerals and, 
in particular, lithium. We all depend on lithium-ion batteries 
in our daily lives. The United States is reliant on a supply 
chain that extends from Australia and South America to China, 
Japan and Korea.
    Lithium Nevada's Corporation is a wholly-owned subsidiary 
of Lithium Americas. It is headquartered in Reno, Nevada, and 
is developing a project called Thacker Pass, which is the 
largest known lithium resource in the United States. Thacker 
Pass will profoundly improve the supply of lithium chemicals by 
producing 25 percent of today's global lithium demand when in 
full production.
    Currently, the U.S. produces just one percent of lithium 
minerals and seven percent of lithium chemicals. The project is 
on track to begin construction in the first quarter of 2021 but 
we will not stay on schedule without the swift and dependable 
permitting as emphasized in S. 1317.
    Lithium Nevada faces additional challenges securing a 
trained workforce and providing levels of financial certainty 
to our investors and business partners. We greatly appreciate 
your efforts to address these issues.
    Thacker Pass is located in northern Nevada on public land 
managed by the Bureau of Land Management. Lithium Nevada and 
the BLM are working cooperatively to evaluate the project. We 
submitted a conceptual plan of operations to the BLM in late 
2018 and will submit a detailed plan of operations this summer. 
We anticipate the BLM will publish a notice of intent to 
conduct the EIS in December and complete the study by December 
2020 in accordance with Executive Order 13817.
    In our experience NEPA processes could be slowed by 
administrative tasks at the state, regional and head offices 
that are removed from the actual environmental assessment 
process. We welcome the spirit of Executive Order 13817 and the 
other administrative reforms that recognize the value in 
concentrating the NEPA process on substantive environmental 
review and encourage state and federal permitting agencies to 
be diligent in their review of critical minerals projects.
    Adhering to schedules like the one prescribed for Thacker 
Pass boosts confidence among employees, community partners and 
financial supporters. Conversely, jurisdictions that fail to 
consider permanent applications and predictable timeframes 
experience minimal private investment and essential workforces 
leave for other, more dependable projects.
    This Committee, the Administration and Department of the 
Interior should be commended for working to provide 
predictability in permitting. It is essential for the United 
States to have an uncompromising, thorough permitting process 
and to do it swiftly.
    Lithium Nevada insists on being part of a project that goes 
beyond simply getting through the approval process. Consistent 
with that vision, it is our duty to ensure these essential 
chemicals are made responsibly without compromising the 
benefits they ultimately bring to the environment. To that end, 
Thacker Pass's mining and processing facilities are being 
designed to be as efficient and environmentally sensitive as 
possible. Two examples are that we'll utilize very little 
water, 2,000 acre-feet per year, which is only slightly more 
than one day of current annual water usage in Humboldt County, 
and our operation will be nearly carbon-free. Heat from our 
plant will be captured to generate as much as 60 megawatts of 
clean energy, which is more than enough to power the Thacker 
Pass operation, and provide surplus power to the grid.
    Lithium Nevada will struggle to employ the trained 
workforce we need of 300 permanent employees. Although these 
jobs will earn an appealing $86,000 a year compared to the 
state average of $55,000 a year, it will be difficult to fill 
the positions. The problem is due to the remote location of our 
project, a historic under-investment in domestic critical 
mineral processing which has limited the pool of technical 
professionals and skilled operators in this field.
    As for capital, Thacker Pass is well-funded by private 
interests, but we will need to solidify the confidence of 
potential business partners and investors because lithium 
processing is a relatively emerging business here. We believe a 
dependable source of federal loan guarantees would confirm the 
government's commitment to the development of a critical 
mineral supply chain and would help to solidify investment 
interest. Federal loan guarantees would also lower the 
project's cost of capital, helping U.S. projects be competitive 
with government-supported investments by China, Japan and 
Korea.
    Demand for lithium is soaring. All the major car 
manufacturers have been out billions of dollars of investment 
in electric vehicle manufacturing. Their current demand is 
anticipated to grow 500 percent by 2025. The supply chain is 
physically long and highly vulnerable to transportation risk, 
political disruptions and foreign economic policy. By and 
large, lithium minerals are currently mined in Australia, Chile 
and Argentina. Lithium concentrates and chemicals are then 
shipped mostly to China, Japan and Korea and formulated into 
cathodes utilized by battery manufacturers, such as Panasonic, 
who supply Tesla.
    This global supply movement is inefficient and expensive. 
Cathode and anode materials for lithium-based battery cells are 
produced almost entirely in China, Japan and Korea. It will 
take a sustained public policy commitment to promote the 
development of the technology, expertise and capital needed to 
make the U.S. competitive in this area.
    The Thacker Pass project presents a critical catalyst that 
will ignite extensive downstream business development. Lithium 
Nevada greatly appreciates the attention this Committee is 
giving to securing critical mineral production in the United 
States.
    We support S. 1317. If enacted, it will bring invaluable 
assurances that the permitting process will be thorough and 
completed in a reasonable timeframe. It strives to invest in 
our next generation of engineers and operators, and it creates 
mechanisms to inject essential capital into our critical 
minerals supply chains. Without this assistance in the battery 
industry, the U.S. will remain decades behind China, Korea and 
Japan while we continue depending on the stability of offshore 
supply chains to furnish the U.S. with essential battery 
components.
    Thank you for attention to these important issues. I'm 
happy to answer questions you may have.
    [The prepared statement of Mr. Evans follows:]
    
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    The Chairman. Thank you, Mr. Evans.
    Dr. Warner, welcome to the Committee.

 STATEMENT OF DR. JOHN WARNER, CHAIRMAN, NATIONAL ALLIANCE FOR 
  ADVANCED TECHNOLOGY BATTERIES, AND CHIEF CUSTOMER OFFICER, 
                   AMERICAN BATTERY SOLUTIONS

    Dr. Warner. Good morning, Madam Chair, Senator Manchin and 
Committee members. Thank you for inviting me to speak this 
morning on this very important topic of minerals and chemical 
processing, especially as it relates to the growing 
technologies of lithium-ion batteries.
    I've been in the U.S. advanced battery industry for over 10 
years and spent nearly 20 years in the automotive industry. I 
currently serve in several different roles in the battery 
industry. First, as a Chief Customer Officer for a lithium-ion 
battery pack startup company based in Michigan called American 
Battery Solutions. Second, I serve as the current Chairman of 
the industry trade group, NAATBatt International, the National 
Alliance for Advanced Technology Batteries. I also serve on 
several different SAE, Society of Automotive Engineers, 
standards committees to help bring standardization to these 
technologies. I'm also the author of two books on lithium-ion 
batteries and, most importantly, I am a user and advocate of 
these batteries as a proud driver of a Chevrolet Volt with 
115,000 miles.
    Throughout history there have been several technologies 
that have helped to shape the direction of mankind, beginning 
with the taming of fire, to the invention of the wheel, and 
later the telegraph, the steam engine, the long-range 
electrical transmission, personal computers, the internet, 
space travel, cellular technologies and, for my purposes here, 
electrochemical energy storage, the modern battery.
    The modern advanced lithium-ion battery is perhaps the most 
important technology of the 21st century due to its role 
enabling other technologies, and the U.S. is largely 
responsible for the invention of the lithium-ion battery based 
on work done by innovators such as Dr. John Goodenough and Dr. 
Stan Whittingham. Yet the manufacturing of these batteries and 
increasing of the expertise in the lithium-ion batteries, it is 
now becoming centered in Asia. China is making massive 
investments in lithium-ion batteries that's estimated to be 
more than $60 billion. And today, as a result, they account for 
60 to 75 percent of all lithium-ion battery manufacturing in 
the world today.
    In order to support these manufacturing efforts, China is 
aggressively acquiring sources of energy materials around the 
world and domesticating the processing of those materials into 
the complex battery cathodes and anodes.
    Based on some of the recent U.S. Geological Survey minerals 
yearbook, both the largest mineral reserves and the largest 
mineral processing for lithium-ion battery materials is being 
done in China, Australia, Brazil and Chile with more than 67 
percent of the world's supply of cobalt, a key chemical in 
batteries using lithium-cobalt oxide, nickel-manganese-cobalt 
and nickel cobalt aluminum chemistries being mined in the 
Democratic Republic of the Congo (DRC) with more than 70 
percent of that being processed in China.
    Lithium presents a somewhat better story since it's more 
widely geographically distributed throughout the world. 
However, more than 98 percent of it's mined and processed in 
Chile, China, Argentina and Australia, and the vast majority of 
the chemicals being used in lithium-ion batteries, regardless 
of where they are mined, are being processed in China today due 
to the low environmental standards and the strong governmental 
support. This points out the complexity of the battery supply 
chain.
    For a U.S. company to build lithium-ion cells would require 
lithium mined in Chile or Australia, cobalt coming from the 
DRC, graphite coming from Australia, Brazil, Canada or China, 
manganese coming from South Africa, copper from Chile, nickel 
from Australia or Brazil or Russia. These materials would then 
need to be shipped to other countries such as China or Korea or 
Japan, where they're processed into battery-grade materials and 
then shipped to the U.S. The cell makers would then need metal 
foils to coat the materials onto which typically come from 
Korea and Japan, polyethylene separators from China, Korea and 
Japan. So we have this largely Asian-centric supply chain which 
promotes and supports the development of the Asian 
manufacturers while putting the U.S.-based manufacturers at a 
disadvantage.
    The reason why the supply chain problem should be a public 
policy concern is because the global competition for advanced 
battery manufacturing capacity and expertise, the ability to 
guaranty reasonably stable and ideally low energy material 
prices to manufacturers is a considerable advantage. Chinese 
companies are buying up energy material supply sources around 
the globe in order to ensure that battery manufacturers based 
in China have access to reasonably stable supplies of low-cost 
materials.
    The loss of U.S. leadership in lithium-ion technology may 
well lead to the loss of U.S. leadership in other important 
technologies. The ability to supply electricity to a device 
without a power cord will be fundamental to most of the major 
new technologies of the 21st century. If you lose expertise in 
the battery technology, you risk falling behind those other 
technologies as well.
    Finally, let me leave you with a thought from one of the 
earliest and greatest American battery innovators, Mr. Thomas 
Edison, whose first battery patents were issued in the late 
1890s. Edison said, ``I don't think nature would be so unkind 
to withhold the secret of a good storage battery if a real 
earnest hunt is made for it, and I'm going to hunt.'' This is a 
belief that most of us in the battery industry still have to 
this day, believing in the spirit of this hunt that drives 
American innovation, drives leading the creation of new 
markets, generating new high-tech jobs, developing new supply 
chains and enabling the technology of the 21st century and 
beyond while boosting the U.S. economy and securing our future.
    NAATBatt continues to work with our members to help develop 
domestic sources for both the supply chain, the materials and 
the battery materials and the battery packs, and we look 
forward to supporting you in this bill.
    Thank you.
    [The prepared statement of Dr. Warner follows:]
    
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    The Chairman. Thank you, Dr. Warner.
    Dr. Ziemkiewicz.

  STATEMENT OF DR. PAUL ZIEMKIEWICZ, DIRECTOR, WATER RESEARCH 
              INSTITUTE, WEST VIRGINIA UNIVERSITY

    Dr. Ziemkiewicz. Thank you, Chairwoman Murkowski, Ranking 
Member Manchin and members of the Committee for giving me this 
opportunity to discuss and offer testimony on the role that 
rare earth elements can be derived from coal and coal-related 
products and support the federal effort to develop a domestic 
supply chain.
    I'm the Director of the West Virginia University Water 
Research Institute. Every state and territory has one. We tend 
to focus on areas that are strongly focused on our main 
pollutant in the state which is acid mine drainage (AMD) from, 
largely, mines that were developed before the invention of the 
Clean Water Act. So they're pre-law mines, before SMCRA, any of 
this went into effect, these mines were abandoned and, 
therefore, just generate acid mine drainage, mucks up thousands 
of miles of streams in the northern Appalachians. So that's 
been our main effort, but this is almost a case study in how 
federal policy can lead in innovation in areas that would never 
have been considered otherwise.
    So, for example, I'm one of the world's experts on the 
subject of acid mine drainage. If there's acid mine drainage 
anywhere in the world, I've probably been there. But it never 
would have occurred to me, I've been at this for 30 years at 
WVU, but it never would have occurred to me to look for acid 
mine drainage as a source of rare earth elements or critical 
minerals until the Department of Energy's NETL laboratory, 
through legislative action here, created a funded program to 
study exactly that issue.
    So we started working on it and also give a lot of credit 
here to USGS' work, maybe 15 years earlier, back in the late 
'90s, supported by Congressman Jack Murtha, to look for 
platinum group metals in acid mine drainage of all things. Not 
much was found but a great database was generated.
    A friend of mine at USGS, Chuck Cravotta, let me have his 
dataset from years gone by, and I looked at it when this 
opportunity came up from NETL and it turns out there are rare 
earth elements in acid mine drainage. No one had ever looked 
for them before.
    So we decided to submit a proposal based on that alone, on 
the acid mine drainage side of it and we found that it has a 
couple of real strong advantages. One, it's, in a sense, it's a 
natural heap leach operation. If you think of a lot of modern 
metal mines are acid heap leaches, a lot of the metal mines 
operate as an acid leach through rock that contains precious 
minerals. Well, in this case, acid mine drainage is exactly 
that, it generates spontaneously all this acid so you get this 
free acid and it leaches, selectively leaches, these metals 
that we want out of this rock mass, the shales that surround 
the coal in the coal-related products. So any tailings, 
underground mines, surface mines, as long as they're acid, they 
generate acid mine drainage.
    When we first got this opportunity, I called up some of my 
friends in the coal industry and asked if we could come out and 
sample some of their acid mine drainage and their treatment 
sludges. They said sure, you can have all you want, because to 
them it's one of their biggest costs in treating acid mine 
drainage is getting rid of this stuff afterwards. So we went 
out and looked at it, and we were finding concentrations that 
were as high as some of the best deposits in the world.
    And the other nice thing about it, not only is the 
concentration high, but the accessibility is high from a 
chemical point of view. You can just--this stuff starts out in 
solution and if you think of most of the mineral processing 
trains, you start by mining a cubic meter of rock, grind the 
daylights out of it, down to talcum powder, separate the good 
stuff from the bad stuff and then start leaching it with really 
strong acids and bases and it's a very complicated process 
until you get to the point where you actually have your desired 
minerals in solution, then you can start separating it on to 
all sorts of wonderful chemistry. Well, what we found out is 
that not only was the stuff already in solution but the 
treatment process itself just added hydroxide to the process, 
adding base knocks them out of solution. We can put it back in 
solution just by raising the acidity level. And so that goes 
off to solvent extraction and we've been able to get 
concentrates up into the 80 percent, 60 percent range of pure 
rare earth element out of some of our coal-derived, acid mine 
drainage products. So this is world class product now. This is 
also work supported through NETL.
    The other nice thing about acid mine drainage as a source 
of rare earth elements is that the pH of acid mine drainage, 
believe me, I know, never gets much below about two and a half. 
In order to get thorium and uranium to go into solution, you 
have to be down below one, and most of the hard rock processing 
trains for that extraction of rare earths also puts the uranium 
and thorium into solution which is why most rare earth mines 
tend to produce a fair amount of uranium and thorium in their 
tailings. We don't have any of that. We looked at uranium and 
thorium in all of our samples, and it just isn't there.
    I'd like to thank you for your leadership on the REEACT 
bill and previous authorizations. It's done great work, and I 
think we have a long ways to go here.
    [The prepared statement of Dr. Ziemkiewicz follows:]
    
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    The Chairman. Thank you, very interesting. It is always 
interesting to hear about some of the technologies out there.
    We focused in our legislation, I think very keenly, through 
USGS, through Department of Energy, on the issue of accessing 
these critical minerals, recognizing that we have a 
vulnerability. But I think it is equally important to talk 
about the ways that we can, through different technologies--
whether it is recycling or looking for those alternatives, 
recognize that we may have more than even we think we do.
    I want to go back to you, Secretary Balash, with regards to 
the mapping initiative. I have always felt that we are not 
doing ourselves any favors when we don't know what it is that 
we have within our inventory of our public lands and certainly 
within our resources.
    You mentioned the mapping. I understand that the President, 
well, we know that he has requested funding to topographically, 
geographically and geophysically map the country. This is the 
Earth MRI. We included some funding last appropriation cycle to 
support this. Where are we within USGS' effort to implement the 
program? What is the status of this?
    Mr. Balash. Thank you, Senator, and thank you, Madam Chair.
    The Earth MRI program, as you noted, is contained. There's 
a budget request in the FY20 request from the Department. The 
Service has been working through and with multiple state 
surveys as well to identify those opportunities for 
partnerships and, then again, with third parties.
    The Chairman. Let me ask you, have most states conducted 
their own inventories or their own mapping so that we can 
compile this into one resource or are we still shy of real 
information?
    Mr. Balash. I think that the situation varies from state to 
state in the maturity of their information and also the amount 
of physical area that they have to assess.
    Our home state, for example, there is a great deal of work 
left to do to complete the mapping there. But in some places, 
you have a better understanding and are able to put that 
information together more rapidly than in others. But the 
figures are a spectrum.
    The Chairman. So we are still a ways behind in really 
understanding what our true inventory is as a nation when it 
comes to our critical minerals and our rare earths?
    Mr. Balash. That's absolutely correct, particularly when 
you consider the advances in remote sensing that are available 
today as compared to even 30 years ago. So in terms of having a 
modern and comprehensive assessment, I think as a nation we 
have quite a ways to go.
    The Chairman. With regard to the Mineral Security Act that 
we have introduced, you have all had an opportunity to review 
it, and you have all said some relatively kind things about it. 
Does it do enough?
    One of the things that I am very aware of is that 
oftentimes by the time we get around to passing legislation, it 
is already a little bit stale. Are we forward thinking enough 
with the legislation that we have laid down here?
    I will throw that out to all of you.
    Dr. Warner.
    Dr. Warner. Yes, I would like to recommend, I think that 
some of the lithium-ion battery materials are definitely an 
area of concern.
    As we look at things like cobalt and lithium, the supply of 
those is in very high demand. And with the growth of lithium-
ion chemistry, I think continuing to add to those materials, 
the lithium, nickel, manganese and cobalts, expanding to make 
sure that those are included and covered--those could be very 
strategic resources. And they're going to be key to the current 
generation of technologies as well as the next generation of 
technologies for energy storage moving forward. As we think of 
beyond lithium, some of these other materials are going to get 
us into some of the lanthanums and some of the other 
lanthanides that are going to move forward.
    The Chairman. Okay. Anything else?
    Dr. Ziemkiewicz and then Mr. Evans.
    Mr. Evans. Yes, thanks, Senator Murkowski.
    Dr. Ziemkiewicz. One of the things that we've noticed is 
that as soon as we mention to a landowner that the acid mine 
drainage sludge on their property may have value, it goes from 
being how fast can DEP get it off my site to this is my stuff 
and no one is going to touch it.
    [Laughter.]
    So the whole issue of ownership and control is really 
important to nail down in some sort of federal guidance, 
because right now it's a free for all and it will be handled on 
a--it would be like coalbed methane, if you're familiar with 
that controversy. It will drag on forever. Resolution on that 
count, I think, would be very useful to include in a bill.
    The Chairman. Very good. Thank you.
    Mr. Evans.
    Mr. Evans. I think the permitting is going to help out a 
lot. I think the tracking and the KPIs that you'd mentioned in 
the details of the bill are going to be important.
    We've seen when you get to the federal level at the BLM, 
resourcing is a challenge to get to permitting through on 
timelines. They're going to be competitive to develop projects.
    I think the workforce development is excellent. If you look 
at our university in technical college programs, it's not 
focused around a lot of these technologies and I think it's 
really important, even with some of the technology you've 
talked about in rare earth.
    The one thing I did mention around credit facilities and 
loan guarantees is something it would be a next step that I 
think would be important to consider as our competitors 
offshore, governments help push development through their 
agencies and even with helping their own companies and it's not 
something that we have done in this country in a long time, but 
we need a strategy around that because we're a decade or two 
behind foreign governments in that strategy.
    The Chairman. Okay, I appreciate that.
    Let me turn to Senator Manchin.
    Senator Manchin. Very quickly, because I know we are all 
going to have to run and go, votes and everything.
    But how we got ourselves into this position to where we are 
depending on more and more of this product coming offshore--I 
mean, we do nothing here. This couldn't have just happened by 
chance. I mean, you had to know and your companies had to know 
that, basically, the development, whether it is in 
manufacturing of cell phones, medical equipment, batteries, 
whatever we use every day, was going to grow. Twenty, 30 years 
ago, we knew that.
    And as that was growing in demand and demand was growing, 
it had to be that we were chasing it, the capitalist society 
were chasing the price. And China was able to go out and gather 
up all the resources they could to own this base resource for 
it to come into their country, to have total control.
    The only way we are going to change this right now, because 
I don't think we will ever be price competitive with China, 
knowing that they got this much of a jump. The only way the 
American people will continue and for us the support with the 
legislation we have is the security of our nation. It is truly 
the security of the nation.
    You all can benefit from that if we have a product but you 
are not going to buy our product if it is cheaper somewhere 
else. It is not the way the game is played.
    So I am trying to figure out how we thread this.
    Dr. Paul, you might want to talk about this but we are now 
being able to turn a liability into an asset and you know it 
can be done.
    What is the price point? You have had to look at the price 
points of what China is charging for these. Where do you think 
the break even is and can you ever get to where we can be 
competitive or do we have to go down the role of truly being, 
having this stockpile of this rare earth minerals for the 
security and defense of our nation?
    Mr. Ziemkiewicz. It's a very good point. I think that some 
price support, if not market support, is needed in the early 
stages because the first thing the Chinese will do, and they've 
done it before, is drop the price on the world market.
    Senator Manchin. Sure, we know that.
    Mr. Ziemkiewicz. Because of its monopoly and that will 
drive anyone out of business. Mountain Pass, which is our only 
active mine right now in the United States, sends all of its 
oxide product to China for refining.
    Senator Manchin. Is that because of environmental laws in 
America where we make it very difficult for us to do that 
process?
    Dr. Ziemkiewicz. I just, I think, and I'm not an economist, 
but I think it's just because they have the supply chain. They 
can fit it right now. There's really no market.
    Senator Manchin. Tell me the price point. Tell me the price 
point when you think that Dr. Warner there is going to buy the 
product, the raw ingredients from America and not overseas, 
because it is cheaper.
    Dr. Ziemkiewicz. Well, we have a concept called a contained 
value for a mineral and ours, because we have a very high ratio 
of heavy rare earths and critical minerals, including cobalt, 
by the way, which is what, 75 percent of our total rare earth 
supply in acid mine drainage sludge. If we move all that 
together, the cost, the contained value is about, on average, 
$237 per kilogram. So that becomes a market factor. Now how 
that plays out in terms of full-scale production is something 
we need to do in the next research steps with NETL.
    Senator Manchin. And what time period are we talking about?
    Dr. Ziemkiewicz. We're working on a proposal right now 
actually.
    Senator Manchin. Because I think our bill here, the REEACT 
bill, gives you, is it $23 million a year?
    Dr. Ziemkiewicz. Yeah.
    Senator Manchin. For a period of time here until we can get 
this thing up and running.
    The only thing I have found, unless there is a private 
sector partnering up with the public sector which is going to 
be the universities or NETL, the timeframe seems to grow longer 
and longer and we are trying to shorten this because we need it 
desperately, as quickly as we can, to put ourselves in a 
position.
    Dr. Ziemkiewicz. Well, one of the nice things about acid 
mine drainage is that it doesn't require any permitting. So 
it's not like putting in a green field mine in the wilderness 
somewhere. You've got infrastructure. You've got a workforce. 
You've got, already, SMCRA permits and clean water right 
permits.
    Senator Manchin. Sure.
    And you said we could produce about 800--how many?--
800,000?
    Dr. Ziemkiewicz. Eight hundred tons of rare earths per year 
just in the sites that we've looked at in central Appalachia.
    Senator Manchin. What type of consumption do we use, do we 
have?
    Dr. Ziemkiewicz. The Department of Defense uses about 800 
tons per year. The total economy is about 16,000 tons.
    Senator Manchin. Sixteen thousand. So it would be a drop in 
the bucket to the total economy, but it would be a help.
    Anybody have any comments on that real quick before we run 
out of time?
    Dr. Warner. I would add that from the battery manufacture 
standpoint, and I've had the privilege of working with several 
companies, we found some interesting things as U.S. cell 
manufacturers is that simply getting access to some of these, 
even offshore, materials is difficult when you're not producing 
in the same volumes as a LG or a Samsung, getting the materials 
manufacturers to be able to dedicate quantity to you or 
material to you becomes very challenging. So they're pricing it 
higher. So you challenge and you struggle to get those 
competitive pricing.
    In the final product, you know, we see batteries coming 
down to $125 or $150 per kilowatt-hour in the relatively near 
future. And with new technologies coming in the next and beyond 
lithium applications, we see potentially hitting below $100 a 
kilowatt-hour. But that's probably ten years out.
    Today, I think, we're targeting in this $125 to $150 at the 
complete pack level. So that's where from battery manufacturers 
we need to be able to afford that and then find those solutions 
which get us some materials that can allow us to reach those 
numbers.
    Senator Manchin. Thank you, Madam Chair.
    The Chairman. Thank you, Senator Manchin.
    Senator McSally and then after her, Senator Cortez Masto 
will go. I am going to pop out and vote, and we will just keep 
moving here.
    Senator McSally.
    Senator McSally. Thanks, Chairman Murkowski, Ranking Member 
Manchin. I appreciate you holding this hearing.
    I was proud to join you as an original co-sponsor in the 
American Mineral Security Act of 2019. Critical minerals are 
not only essential for manufacturing modern technology all of 
our lives depend on, but mineral production is critical in 
Arizona's economy. The mining industry in Arizona generates 
$4.29 billion of economic impact, supports 44,000 jobs across 
the state and delivers $482 million in state and local taxes, 
in addition to much more in federal taxes.
    While not listed as a critical mineral, copper is indeed 
essential. In Arizona, we have a lot of copper, one of the five 
Cs. We produce 65 percent of the nation's copper output, more 
than any other state.
    Mr. Balash and Mr. Solan, we know copper is an essential 
component to electricity production and renewable energy 
technology. What is the demand for copper going to look like as 
the forecast for solar energy, electric vehicles and charging 
infrastructure continues to grow?
    And it is important to note, many of the critical minerals 
needed for advanced battery technology, like nickel and cobalt, 
are byproducts of copper production. So I am interested to hear 
your perspectives, Mr. Balash, on copper byproducts and the 
Department of the Interior, what they are doing for byproduct 
research and development.
    Mr. Balash. Thank you, Senator.
    The compilation of our critical minerals list last year 
received a fair bit of scrutiny on the question of where to put 
copper on that list for precisely the reasons you've 
identified. Its growing demand that we see coming down the pike 
as well as depleted reserves that are being produced as we 
speak is adding up to something that we can see out in the 
future as being a bit of a challenge. And that's reflected in 
some of the commodity pricing that we've seen over the last 
year.
    I would say that the byproducts associated with copper 
production, many of those are already on that, the list, and 
something that bears monitoring. The ability to identify what 
those byproducts are going to be in these larger assessments 
that we've done are difficult to identify in some of the older 
research and assessments that have been done for resources 
around the country. I think a modern assessment will help 
identify some of those additional products that are present in 
the ore body.
    Senator McSally. Great.
    Dr. Solan, do you want to add anything?
    Dr. Solan. Sure.
    We would definitely agree that copper is essential to our 
society. We depend on it for electrical infrastructure and one 
of the things that we're looking at, at the Department of 
Energy, is the relationship between the supply and demand and 
how quickly we may or may not electrify our society.
    You did mention, too, in regard to clean energy 
technologies and electric vehicles, electric vehicles also 
depend on copper. I mean, we tend to talk just about battery 
chemistries themselves, but that's important. And we also 
forget too that copper is essential to internal combustion 
engine vehicles as well. So this is something that we think is 
important and is likely to grow in the future.
    Senator McSally. Great.
    I want to follow up a little bit about this.
    I am truly an all-of-the-above energy strategy kind of 
person. Some of the loudest advocates for renewable energy 
production, however, are some of the biggest opponents of 
mining. Those are contradictory in my view. It may work 
politically for them but not scientifically. Any serious 
conversation about lowering our emissions needs to include 
robust support for America's mineral production.
    Dr. Solan, can you comment again on whether our ambitious 
renewable energy goals can happen without increased production 
of critical minerals?
    Dr. Solan. I would say that critical minerals are 
definitely important in achieving the goals that we have and 
also pushing the technologies forward and providing producers 
and manufacturers with the widest range of technologies 
available.
    I mentioned before that our three pillars also look at, not 
only diversifying our supply and production, but also taking a 
look at alternatives and substitutes. And we've put in quite a 
bit of work on that, but there's only so far that you can go in 
terms of certain technologies, mechanical versus say, direct 
drive, if the minerals aren't there. So this is something that 
we think is really important moving forward.
    Senator McSally. Great, thank you. I will yield back so we 
can vote.
    Senator Manchin [presiding]. Senator Cortez Masto.
    Senator Cortez Masto. Thank you. Thank you, everyone, for 
being here. Mr. Evans, good to see you again.
    Mr. Evans. Thank you, Senator.
    Senator Cortez Masto. I have a few questions for you.
    I know many of the critical minerals for the battery supply 
chain are included in the list of strategic minerals. How long, 
typically, does it take to develop a resource and get it to 
market?
    Mr. Evans. For a mine, a lithium mine?
    Senator Cortez Masto. Correct.
    Mr. Evans. Cobalt, seven to ten years.
    Senator Cortez Masto. Seven to ten years. And are enough 
critical resource projects at the right stage of active 
development domestically, or even internationally, to meet the 
projected needs for the future and what do we need to do to 
meet those expectations?
    Mr. Evans. No, not even close.
    Senator Cortez Masto. No, yes.
    Mr. Evans. There's not enough in development. Certainly, if 
you look at where demand, whether it's for electrification, 
going out seven or eight years from now, we need to be doing a 
lot more.
    I think the legislation that's been introduced here is 
very, very helpful and I think the other difficult thing that, 
and we've talked about it and Senator Manchin as well mentioned 
it, was that it's attracting capital to get these projects 
developing.
    The United States has cobalt and lithium and manganese and 
copper. We need to push for the development and get private 
funds involved. And it might require some government support to 
help catalyze that, get it started, but that's been one of the 
biggest barriers. I think the permitting reform here is great 
but it's getting people off the sideline and getting public 
funds to move.
    Senator Cortez Masto. Do you think passing this legislation 
and also promoting or investing in a federal loan guarantee 
program would help bring in investors and the private sector?
    Mr. Evans. I would. I do, very much so.
    Senator Cortez Masto. Okay.
    Mr. Evans. Yes.
    Senator Cortez Masto. Let me ask you this. What areas in 
the battery supply chain are we missing besides the development 
of critical raw materials?
    Mr. Evans. It's the donut to me which is the cathodic 
materials for the electrodes. A lot of that technology is done 
all in Asia now, Dr. Warner talked about that, and a lot of 
research and development is done there. So if we had the 
minerals here, the next step is to actually make the electrodes 
here as well.
    Graphite can come from Alaska. The other minerals from the 
U.S., but that R&D we can focus here. The separator which came 
from the U.S., now is made primarily in Asia is another key 
component and then the electrolyte. With those three we can 
then manufacture cells, and we'd have the complete supply 
chain.
    Nevada is a great example. We've got Tesla. We're 
assembling batteries but all those other pieces we need as well 
besides the minerals which is just beginning.
    Senator Cortez Masto. Then one final thing that you talked 
about was workforce development as a challenge. What are you 
doing to address that right now and what can we do at a federal 
level to support that?
    Mr. Evans. We have training with Great Basin College that 
we initiated. I think the elements of this bill and the funding 
around college and university development around curriculums is 
critical. There's some great programs in metallurgy at 
University of Nevada at Reno which I think we can expand, 
especially around mineral beneficiation.
    Those things are really, really important and I think we 
need to continue to focus on them because even with these 
projects we don't have the workforce.
    Senator Cortez Masto. I appreciate that.
    Let me open that up to the panel. What else can we do at a 
federal level or, in general, to address the workforce issue 
because we can pass this legislation and identify critical 
minerals that we need, but at the end of the day if we don't 
have the workforce, that is going to be the biggest challenge 
for us.
    Mr. Balash. I know from our own experience, Senator, at the 
Department of the Interior, we're seeing a graying of our staff 
in terms of the expertise or mining in general.
    Senator Cortez Masto. Right.
    Mr. Balash. And that is something that we see nationwide. 
It's not specific to any particular part of the Bureau.
    And so, I think there's definitely a need to come back up 
the ramp. We've seen, sort of this, sort of the downside of the 
curve. We need to come back up in terms of our opportunities 
for education. The number of School of Mines that are present 
in the West has fallen almost in half in the last 30 years. 
That's something that, I think, is a problem as well. If 
students who are enrolled in the university systems don't get 
exposed to those opportunities as part of their regular 
curriculum, as youngsters wander their way through college 
years and finding their path, that opportunity needs to be 
presented to them.
    Senator Cortez Masto. Okay, thank you.
    Does anybody else have any thoughts?
    Dr. Warner. Hi, good morning.
    I would add that from a battery standpoint we find that 
there's actually no battery engineering programs. I think 
there's two universities that actually have battery engineering 
programs.
    There's mechanical engineering, chemical engineering, 
thermal engineering, but there's very few universities today 
that actually do focus on a program to develop battery 
engineers which is one of the most unique engineering fields 
because it does compromise and compose of all of the 
engineering facets from thermodynamics to electronics and 
software to the chemistry of it.
    Many universities have bits and pieces in programs of them 
but very few actually have programs set out to develop, you 
know, actual battery engineering. That's one of the areas we 
struggle with.
    Senator Cortez Masto. Thank you.
    Sure.
    Dr. Ziemkiewicz. Well, I asked, anticipating this question, 
I asked one of my mineral processing colleagues where the jobs 
are for their graduates. And they said a lot of them are in 
mining, a lot of them are in downstream manufacturing, for 
example. But the least amount of jobs was in mineral processing 
right now.
    And certainly, our experience, my experience personally, 
watching the graduates and the size of the different 
departments come and go over the years, if there's a job 
opportunity out there, then students will flood into those 
fields.
    Senator Cortez Masto. Right. Thank you.
    Thank you. I appreciate the conversation today.
    Thank you, Madam Chair.
    The Chairman [presiding]. Thank you, Senator.
    Senator King.
    Senator King. Thank you, Madam Chair.
    I think several of you touched on this in your earlier 
testimony. What potential is there for mining recyclables, in 
other words, recycling? Do the rare earths in a battery 
disappear in the chemical process or are they there if we could 
develop a very strong recycling process around this problem? 
You are in the battery business, tell me.
    Dr. Warner. Thank you, Senator.
    This is actually an area that NAATBatt has been actively 
working on for several years now, and it's an interesting 
dilemma.
    If you look at the vehicle life cycle, the average vehicle 
in the United States has about an 11.5-year life cycle. So the 
first electric vehicles were actually launched in late 2009 or 
early 2010 which would be----
    Senator King. I have a 2012.
    Dr. Warner. Perfect.
    [Laughter.]
    So the Chevy Volt, the Nissan Leaf and Tesla model or the 
Tesla Roadster all were launched then. So they should be 
nearing their end of life now.
    Within NAATBatt we've been working on trying to put 
together some industry information to figure out how do we 
handle these, when these vehicles start coming back.
    Senator King. But my basic question, the chemicals are 
still there.
    Dr. Warner. The chemicals are still there.
    So today the processing either involves a hydro-
metallurgical process or a pyro-metallurgical process. There's 
actually new work going on by several organizations, even here 
in the U.S., to do what they're calling cathode, de-cathode or 
roll-to-roll recycling by which they're able to take the active 
cathode materials to reprocessing and get them done quickly.
    Senator King. So there is some significant potential here?
    Dr. Warner. Absolutely, absolutely.
    Senator King. Let me ask a different question.
    I am sorry to rush you.
    Dr. Warner. No, no.
    Senator King. You don't know it, but we have numbers that 
go down from five minutes sitting here.
    [Laughter.]
    As I understand the testimony, the principal environmental 
problem may be partially mining but it seems to be processing 
and the waste from processing. Is there hope of additional or 
new technologies for processing that will minimize the 
environmental side effects so that we can move forward with 
that here rather than places that have more lax environmental 
standards?
    Anybody want to touch that?
    Mr. Evans. Yeah, I'll take that. Thank you, Senator.
    At least in our process, I think, there are ways to do this 
and it can be done very, very safely, we could look at 
traditional sources leased in lithium, but I also know in 
cobalt and others. I think projects can do good and do well 
even under the current environmental laws that we have or 
what's being promulgated in the future, it's possible to, I 
think, live in both worlds.
    In our own case here, we're going after an unconventional 
deposit and that's been a hallmark of what we're doing here is 
not only to create, look at the waste pile itself and look at 
it differently and see if we can come up with, maybe even, a 
secondary use for it, but also to dry stack it so that we can 
store it and put it away in a safer method than might have been 
traditionally done in the past, all of this while the project 
is still economical. We have a backdrop in this industry of 
demand is going up.
    Senator King. Right.
    Mr. Evans. So pricing for a lot of things has gone up as 
well too. That supports----
    Senator King. Which opens up additional technologies.
    Mr. Evans. Exactly.
    Senator King. Let me follow up a bit on that.
    I used to say in Maine that I wanted the strongest 
environmental standards in the country and the most timely and 
predictable process.
    Is that what we are talking about here? Are we--we are not 
talking about lowering environmental standards, but we are 
talking about improving the process so that it is more timely 
and less expensive, is that correct?
    Mr. Evans. Yes, Senator. So, timely and predictable.
    That's the difference in that you go next across the border 
to Canada or Australia, they still have strict environmental 
standards as well, but they accomplish what Senator Murkowski 
had said takes seven to ten years to get approvals here in the 
United States. There's a lot of mineral resources in those 
countries, it's usually about two years because there's a very 
strict process. Agencies work together and they have to get 
back and close the process out where things can drag----
    Senator King. Well, one of the things we did in Maine that 
was helpful, that might be useful, is one-stop shopping. In 
other words, you don't have to go serially to five agencies.
    Mr. Evans. Right.
    Senator King. You have one lead agency and everybody else 
works through that process, and we found that to be very 
effective.
    I may have missed this because I was out for a few minutes. 
A lot of talk about China. There is also a lot of talk in the 
news today about China, are the tariffs and this trade 
unpleasantness going to affect this part of our strategic 
supply of these minerals that are--many of which come from 
China? Are they included in any of the tariffs or anything 
anybody know?
    Dr. Solan. Senator, as I understand it, in terms of the 
tariffs that we were applying that rare earth elements were not 
included with that in the initial list. That was also in 
addition to that, it was on pharmaceuticals, but rare earth 
elements we were not putting tariffs on, was my understanding.
    Senator King. But China, as part of their retaliation, 
could diminish, restrict the supply if they chose to take that 
financial hit, is that, that is correct? I mean, that is the 
strategic danger, right, whether it is in the context of a 
trade war or just national competition?
    You are nodding. That won't show in the record. Somebody 
has to say, yes. The better term is ``yes, Senator, you are 
right.''
    Dr. Warner. Yes, Senator, you're right.
    Senator King. Thank you.
    Dr. Ziemkiewicz. I do have an example of that.
    The Japanese had a territorial dispute on some islands 
between Japan and China. I think it was a few years ago, 2010 
maybe. The Chinese simply restricted the ability for the 
Japanese to get their rare earth supply and the Japanese caved 
within something like three or four months.
    Senator King. Because of the Japanese manufacturer of these 
high-tech devices that needed that supply?
    Dr. Ziemkiewicz. That's correct, Senator.
    Senator King. That is an object lesson to us, it seems to 
me.
    Dr. Ziemkiewicz. Oh, yes.
    Senator King. Thank you. Thank you, Madam Chair.
    The Chairman. Well, and Senator King, that is exactly why 
we are here. That is exactly why we are here.
    You think about that level of vulnerability when you have 
one nation that really holds the keys to so much of this, and 
we have heard that many of the resources are actually located 
there. But even if they are not located there, if they are from 
other countries, even if they are from the United States, where 
are we sending this to be refined, to be processed. It is all 
going back to China.
    We have, what we believe to be, a very interesting prospect 
for critical minerals and rare earths in Alaska, and we would 
like to try to figure out how we can move forward with it. But 
part of the problem is do we want to be accessing that in 
Alaska only to send that to China, only to be vulnerable to 
them for the return when it comes back in a reprocessed state?
    This is exactly why we need to be having this conversation, 
is the vulnerability that we have as a nation now and what we 
can do about it. So----
    Senator King. Madam Chair?
    The Chairman. Sir?
    Senator King. I just was handed a news piece. Lithium-ion 
batteries are among the list of about $300 billion worth of 
Chinese goods upon which the Trump Administration plans to levy 
tariffs, of concern.
    The Chairman. It should be of concern to all of us, yes. 
This is real time for us right now.
    I want to ask, Dr. Warner, you raised the issue when we 
were talking about the supply chain here, and you call it an 
Asia-centric supply chain.
    It seems to me that, perhaps, we don't have to own the 
whole supply chain there, but we need to have some piece of it. 
We need to be intervening in some way. Is there some focus on a 
particular part of the supply chain for batteries that you 
think would be more important than others, I guess?
    Dr. Warner. Yeah, absolutely, thank you, Senator. That's a 
wonderful question.
    I think that the processing of the materials, as we look 
globally, there's materials in many places other than China as 
well, as well as we've got here. So I think the processing of 
them is actually an area of key importance.
    If I can give you one short example. There's some work 
going on right now with some, several, companies working on a 
process called atomic layer deposition. And this is a process 
by which they're actually able to layer single atoms onto 
molecules that we use in lithium-ion batteries which promotes 
longer life, better energy density and better performance.
    And the only reason they're able to do that is because 
they're partnering with the processing people, understanding 
how the materials are coming out, how they're making it. So if 
we can delve deeper into that manufacturing and processing of 
those minerals here, that will certainly help ensure those 
future technologies coming forward.
    And then, I'm a proponent always of the cell manufacturing. 
I think as we look at our armed services and the lithium-ion 
cells used in much of the military, the space programs, most of 
those cells are coming from foreign sources right now. So that 
does put us at some strategic disadvantage. So being able to 
build cells here and packs here to support those applications 
is vital, I think, to our security.
    The Chairman. Let me go back to you, Secretary Balash, when 
I mentioned just an inventory in understanding. We also know 
that many of the minerals that we are consuming are not mined 
independently, that they are produced in conjunction with other 
minerals. We have a large copper mine in Utah that also 
produces molybdenum and radium as byproducts.
    I am assuming that it is relatively common that we have 
this coproduction in these mineral deposits that if you are 
going for say, for instance, copper, there are other elements 
that we know to be colocated with these minerals, right?
    Mr. Balash. Yes, Madam Chair, that is absolutely correct.
    The Chairman. Is it economic or even realistic to produce 
some critical minerals on their own?
    Mr. Balash. In some cases, it's not economically feasible. 
The process of what is typically hard rock mining involves 
moving efficiently, a large body of ore, crushing it, milling 
it and refining it.
    Ultimately, those economics rest on the base or primary 
material or product that comes out. All of their own, the 
additional supplies of whether it's platinum metals groups or, 
you know, some of the other moly products, byproducts, those 
economics wouldn't stand on their own without the underlying 
recovery of whether it's copper, gold or silver.
    The Chairman. So let me ask, Mr. Evans, are there other 
minerals that could be produced from your lithium product?
    Mr. Evans. There are other chemical compounds, yes, 
Senator.
    The Chairman. Are you working to access them?
    Mr. Evans. Yes, as part of the chemical process that we do 
the byproducts, if you will, we're looking for, there are 
already markets for those. Actually, there's two byproducts and 
even our tailings, as I mentioned to Senator King, we're 
looking, actually, at uses for that as well because it's not 
toxic at all and it looks like there might be some construction 
uses for that.
    The Chairman. Good.
    Senator Daines, you have not yet asked questions, have you?
    Senator Daines. I have not.
    The Chairman. Let me turn to you.
    Senator Daines. Chair Murkowski, thank you, and I want to 
thank you for holding this hearing, truly. And thank you for 
working on bipartisan solutions to address the United States' 
growing dependence on foreign-sourced minerals and metals.
    Let's talk about Montana for a moment. Montana alone is 
home to about a dozen minerals that are on the USGS' net import 
reliance list. This includes copper, which the U.S. is 32 
percent import reliant, as well as silver, which the U.S. is 65 
percent import reliant. Both of these can be responsibly mined 
in Montana at the Rock Creek and the Montanore mines. However, 
and this is a big however, these mines have spent decades 
jumping through bureaucratic and litigation hoops, and we still 
don't have a date in sight. This lengthy and burdensome process 
hurts high-paying jobs that these mines can supply, jobs the 
community fully supports. Tax revenue supports local 
governments in that part of our State in Northwest Montana and 
by delaying it, it perpetuates the U.S.' dependence on foreign 
countries.
    Mr. Balash, what is the Administration doing to speed up 
reviews so that mines like Montanore and Rock Creek are not 
stuck in an endless, endless cycle of permit authorization?
    Mr. Balash. Thank you, Senator Daines.
    The Department of Interior has undertaken a variety of 
changes to our business processes wherein we review the NEPA 
documents, the foundational documents, for permitting mining 
activity on most public lands. And through those changes to our 
business processes in DC, we've seen dramatic reductions in the 
amount of time that it takes for a NEPA notice, whether it's at 
the beginning or at the final stage, to move its way through 
our building here in DC. And that has empowered our state 
offices to undertake the work on a basis where they understand 
and are accountable for the product that comes out.
    So, as we've addressed the issues here in the way 
headquarters operates, we're now turning our attention to the 
state level activities. And what we have found is that Nevada, 
in particular, has, the Nevada BLM, has identified some best 
practices for engaging in the permitting of mines and 
conducting the NEPA associated with hard rock mine activity, in 
particular.
    So we're now in the process of, in essence, exporting those 
best practices from Nevada to other states that have had 
difficulties in front of the courts or elsewhere in getting 
across the finish line.
    Senator Daines. Mr. Balash, I appreciate the administrative 
view on that.
    I want to shift gears, as we think about legislative action 
besides Chair Murkowski's bipartisan bill, what more can be 
done in Congress to promote responsible development of critical 
minerals in the U.S. so we are less dependent on foreign and 
sometimes even hostile governments?
    Mr. Balash. So I think the way to describe this is there's 
a multi-step process here.
    First, we need to understand what it is we have, and I 
think the legislation does a good job of calling on the GS and 
others to understand what our resource potential is within our 
borders.
    The second step is to make it incumbent upon the resource 
agencies, BLM, but also our partners at the Forest Service and 
the Fish and Wildlife Service, to ensure that our land plans 
make those resources available, that they don't foreclose or 
withdraw them from the playing field.
    And then finally, the issue that you've hit on is on the 
permitting side, and while in this Administration the one 
federal decision doctrine has been identified by the President 
and we are seeing some successes in certain places, we 
encounter on a fairly routine basis incongruities and 
differences between one agency and another. And so, our 
timelines don't always sync up well. I think that's an area 
where we could be helped along to be able to function more 
efficiently overall in the processing of permits for hard rock 
mines, in particular.
    Senator Daines. Thank you for the thoughtful answer.
    I want to ask a second question regarding the green new 
deal.
    We have the potential to responsibly produce valuable 
minerals while also protecting our environment. We see that in 
Montana where we have the Stillwater mine there, literally, in 
the backdrop of the Absaroka-Beartooth Wilderness.
    What I think some people don't understand is that wind 
farms and solar panels do not grow naturally in the wild. You 
have to mine and refine raw materials to make them. If the U.S. 
wants to be a leader in renewable energy, they also have to be 
a leader in responsible mining. You can't have it one or the 
other. We need to have it both ways. There is no green new deal 
without mining. Wind, solar and storage systems use significant 
amounts of mined materials and some forecasts project, listen 
to this, a 12-fold increase in mining to meet the demands. If 
we want to increase renewable energy, we must also increase 
development of our natural resources, particularly our mining 
capabilities.
    Mr. Balash and Dr. Solan, shouldn't we be spurring 
responsible development of critical minerals for energy 
systems, instead of making it nearly impossible to mine in the 
United States?
    Dr. Solan, why don't you start?
    Dr. Solan. So as I mentioned before, at the Department of 
Energy our first pillar in terms of our R&D portfolio is trying 
to diversify our supply and encourage U.S. production as part 
of that.
    One of the ways that we do that is trying to improve 
critical minerals recovery from ores. And we'd like to look at 
the whole supply chain in terms of our R&D because it will be 
really tough, as the Chairman noted, to reprocess or do 
separations if we don't have a product to do that with.
    It's the same on down the line. If we could improve things 
throughout the supply chain and add value throughout, it makes 
more economic sense to do all of that in the U.S. So that's 
something that also, too, when we talk to our allies around the 
world and we have talks with them, is we would like to bring 
production to the U.S. and bring it under the American 
regulatory umbrella because that would definitely improve 
environmental outcomes. It would also add to American jobs and 
U.S. economic growth.
    You know, that said, the President's December 2017 
Executive Order 13817, we've been a part of that. Secretary 
Balash has noted the list of critical minerals, and the 
Department of Commerce is putting out a report soon whereas at 
least leading the report, that will help define a national 
strategy for critical minerals. And a big part of that which 
we're all working together on has to do with permitting and 
streamlining and recommendations for U.S. production.
    Senator Daines. I am out of time, Chair Murkowski, so I 
will yield back to you. Thank you.
    The Chairman. Thank you, Senator. Good questions.
    Let me ask about the impact that this lengthy permitting 
process has on just an investor's willingness to be 
participating here. Mr. Evans, we have acknowledged that it is 
just longer here, oftentimes twice as long, maybe more. What is 
that doing to the investment environment and the willingness to 
even get in the game here in this country?
    Mr. Evans. Thank you, Senator.
    I think it suppressed interest in domestic projects here. I 
think one of the questions earlier is how did this happen 
before and the history here is that its investors have gone 
overseas. They've gone other places and ignored the assets that 
we have here.
    And it's going to be a challenge even now to get people off 
the sidelines, private investors, because that's what we really 
want here is private funding to fund these projects. A reliable 
permitting process where people understand it's going to be a 
finite amount of time and then construction can start and cash 
flow could start and they can basically make a profit after 
that is going to help immensely, I think, to drive more public 
money and capital into these projects.
    The Chairman. Let me ask you, Secretary Balash, when we 
think about different ways that we can provide the right 
incentives, sometimes it is, well, much of the time it does 
focus on the permitting side of it.
    There has been a lot of discussion around this place about 
an infrastructure package and what that might look like. We all 
know that includes things like highways and courts and 
transmission systems and bridges, but I also think that we need 
to be doing all that with minerals that are produced 
domestically. I think that just makes a lot of sense.
    What is the Administration doing to keep an eye on the 
entire supply chain when we are talking about infrastructure 
and an infrastructure package? And then, is there consideration 
that within a broader infrastructure bill we are looking to the 
permitting side that might include our critical minerals?
    Mr. Balash. Thank you, Madam Chair.
    The list of materials that will be important to support the 
development and reinvestment in infrastructure in this country 
goes far beyond what we've identified in the critical minerals 
package. However, many of the improvements that both the 
legislation calls for and that the Administration has 
undertaken to bring timeliness, efficiency and certainty to the 
permitting process, at least as it relates to NEPA, are things 
that we think can be quite helpful overall in ensuring that the 
suppliers of strategic and industrial minerals, to 
differentiate from critical ones, are available in time to meet 
the needs for the construction activities that would be 
undertaken as a consequence.
    So whether it's as simple as gravel fill or getting iron 
ore for steel beams that go on bridges and trestles, all of 
those things need to be available to meet the market signals 
that would come about in the lead time running up to actual 
construction.
    The Chairman. Thank you for that.
    I am going to go ahead and vote.
    Senator Lee, if you want to go ahead and proceed and then I 
will be back.
    Senator Lee. Thank you, Madam Chair. Thanks to all of you 
for being here today.
    I want to start with Mr. Balash.
    You know, we have had a lot of discussion today about 
streamlining the permitting process and about workforce 
development, and those are all important things. It seems to me 
that none of those will make a difference, none of those will 
matter if we don't have minerals to extract, if we have taken 
them all off the table. I think that is something we have to 
take into account.
    New mining operations are either restricted or banned 
altogether on more than half of all federally-owned lands. That 
is a stunning figure, especially when you consider the fact 
that federally-owned lands make up about 30 percent of all the 
land mass in the United States. And a lot of the minerals that 
we have in this country are actually on federal public lands.
    So, a lot of us, a lot of members of the Senate, while 
claiming in one breath to be very concerned about the domestic 
supply of critical minerals are, at the same time or in the 
very next breath, trying to make it more difficult to do this, 
routinely introducing bills to withdraw thousands, sometimes 
hundreds of thousands of acres, from any and all new mineral 
exploration.
    In fact, this very afternoon the Public Lands Subcommittee 
will be holding a hearing on some bills that would do precisely 
that on a series of bills that when cobbled together would take 
out nearly a million acres of federal public land from mining 
exploration and development.
    Is there any way to guarantee that just because there are 
no active claims on given parcels of land that future 
exploration or future technology would not discover or make 
accessible and economical the mineral development on that land? 
In other words, I guess my question is, when we look at bills 
like that, that would force mineral withdrawals on our system 
of federal public lands, can we always know what is there or 
what reasonably could be there given future developments in 
technology?
    Mr. Balash. Thank you, Senator Lee.
    Your comment reminds me of something that stuck with me for 
many, many years. It was a conversation with an old ``rock 
licker'' geologist who told me, ``markets change, technology 
changes, but rocks don't change.'' And understanding what we 
have in our mineral estate is critical, not only for 
understanding what the opportunity is today, but what it might 
be 100 years from now.
    And so, I think one of the really important aspects of the 
legislation in front of us is, is the assessments that the GS 
is called on to perform and to do so periodically because over 
time our understanding, our ability, to source and detect those 
minerals at deeper and finer resolution levels will improve 
over time as well. So that is a long-term understanding we all 
need to have.
    Senator Lee. In light of that, I appreciate your analysis 
on that.
    Any time we are having a discussion about critical minerals 
and about our ability to access them, whether or not we have an 
adequate domestic supply, is it even possible to have a 
rational conversation about that without also having an honest 
conversation with ourselves about mineral withdrawals on public 
lands?
    Mr. Balash. So one of the things that, I think, in this 
Administration we've tried to take a hard look at is whether or 
not administrative actions that withdraw the mineral estate 
make sense in that light. And there's a couple that we have, in 
fact, reversed from the prior Administrations. And one of those 
had to do with a very large withdrawal in the mountain region, 
having to do with the targeted efforts to protect sage grouse 
habitat. And as we took a look at what was approaching a ten-
million-acre withdrawal, mining activity, surface activity 
would have affected, maybe, you know, a fraction of a percent 
of that surface. And so, we didn't think that really made 
sense, withdrew that or canceled that withdrawal, lifted that 
withdrawal and also one in the California desert. So, and we've 
resisted granting other administrative withdrawals.
    Now, when Congress in its wisdom chooses to take things off 
of the federal mineral estate, that's your business.
    Senator Lee. I was relieved that you did not use air quotes 
there, but you would have been well within your right to do so.
    Mr. Chairman, I have one more question, do you care if I 
ask that?
    Senator Manchin [presiding]. Sure, go ahead.
    Senator Lee. Okay, thank you.
    Within our system of laws, we have state laws and federal 
laws that both have to be complied with. In many instances you 
have environmental laws, you have federal NEPA law and state 
NEPAs or NEPA-like legislative frameworks in the various 
states. This adds a layer of complexity and understandably, 
states are themselves sovereign entities, they have their own 
right to exist, their own right to make laws.
    Are there ways that you can think of that we could reduce 
some of the overlap between the federal and state requirements 
that could allow applicants to comply with both of them? We 
could streamline the processes so they dovetail one with 
another.
    Mr. Balash. Senator Lee, as a former state executive, I 
appreciate your recognition of states' sovereigns and would 
note that there are some opportunities, I think, with CEQ, if 
they were to maybe address through their regulations our 
ability at other federal agencies to take into account the work 
that's been done by other governments, specifically state 
governments. That would reduce some of the duplication that we 
have to undertake in the course of doing our own NEPA reviews 
or permitting actions.
    Senator Lee. Great. Thank you very much.
    Thank you, Mr. Chairman.
    Senator Manchin. Thank you.
    I will follow up, and then we will see who comes back from 
voting. The second vote is going on right now.
    Let me ask the question on the tariffs, basically what 
tariffs are going to do since it seems that China has very much 
of a monopoly on rare earth elements which we are using every 
day and it is going to be, I am sure on the batteries, Dr. 
Warner.
    Do you see the impacts so far? Has it affected you all and 
do you anticipate an effect?
    Dr. Warner. I think that's an excellent question, Senator. 
Thank you.
    As of today, we haven't seen the impacts, but I'm looking 
to buy cells. So with our new company, as we buy cells 
globally, that will make them more expensive which will make 
our end products more expensive. The raw materials are still 
likely being processed in Asia for those Asian cell 
manufacturers, so we'll receive them as a completed unit, as a 
lithium----
    Senator Manchin. But I am saying that tariffs have been 
placed high.
    Dr. Warner. And the tariffs are going to be, as the tariffs 
are added, they will make those cells more expensive for us to 
acquire and that's going to make it more expensive for our 
customers down the line. So yes, it's going to add challenges.
    Senator Manchin. Dr. Ziemkiewicz, in West Virginia we know 
we have an awful lot of change pre-SMCRA that you are probably 
looking at and dealing with. Are you basing on if we produced 
in all the streams that we have, that we know that we have acid 
mine drainage, which gives you, pretty much, a food chain, a 
link to join things expediently? That is where you are getting 
the 800 tons when you are anticipating that, or where did your 
estimation of 800 tons production come from?
    Dr. Ziemkiewicz. Eight hundred tons, Senator, are the 
number of discharges that we actually sampled. So these were 
largely regulated discharges as opposed to the unregulated 
discharges.
    We reckon there are something like five gallons of 
unregulated AML discharge for every gallon of regulated 
discharge in the Northern Central App.
    Senator Manchin. So it could be four, five, six thousand 
tons?
    Dr. Ziemkiewicz. Potentially, yes.
    Senator Manchin. And that is just in West Virginia, that 
was including all the acid mine drainage we have in----
    Dr. Ziemkiewicz. That would include Western Pennsylvania 
and also Eastern Ohio.
    Senator Manchin. Okay.
    So it could pretty much have a tremendous effect on the 
supply chain?
    Dr. Ziemkiewicz. Oh, absolutely.
    And another thing, I think it's important to note that 
this, if you think about an ore body, ore bodies have the 
easily accessible ores, usually on top of the ore body, easy to 
mine. The sulfides have gone away and you've got pretty pure 
metal. And then you've got the more difficult to extract, 
deeper stuff where you have to go underground.
    Senator Manchin. Sure.
    Dr. Ziemkiewicz. And start exploring.
    Senator Manchin. We are talking, I think that Senator Lee 
was mentioning about permits, how difficult permits can be, Mr. 
Balash, acquiring them. Sometimes it wears people out, they 
just don't fool with it.
    We have already got a ready-made supply of product and that 
is why I can't believe we have not used it or why we are not 
looking. But DOE, we are hoping with this piece of legislation, 
we have bipartisan support. It makes a lot of sense.
    Dr. Ziemkiewicz. Right, it's the high-grade end of an ore 
body. That's how I see the acid mine drainage picture. And 
that's not even counting the hard rock acid mine drainage which 
is gigantic by comparison.
    Senator Manchin. What do we do to the water quality after 
we process it to take the rare earth minerals out? Are we able 
to return it in much better condition?
    Dr. Ziemkiewicz. Oh, absolutely.
    In fact----
    Senator Manchin. Can we bring the stream back to life?
    Dr. Ziemkiewicz. Oh, yeah. Yeah, in fact what you'd have is 
a classic acid mine drainage plant.
    We're putting together a proposal right now for DOE that 
would integrate a West Virginia DEP acid mine drainage plant 
under their bond forfeiture program with a rare earth 
extraction facility integrated in one facility up near Mount 
Storm, by the way.
    Senator Manchin. Will the DOE take the product to buy, you 
know, for what we are producing? Will they be able to use that 
or can they process that or do we have to be able to refine it?
    Dr. Ziemkiewicz. We would have to create that supply chain, 
yeah.
    Senator Manchin. So there are no refineries in the country 
right now?
    Dr. Ziemkiewicz. Not right now, but again, that's something 
that could happen fairly quickly.
    Senator Manchin. Yes.
    Anybody else have anything, because I know if the second 
vote is going on and no one returns, we might be wrapping up.
    Mr. Evans, do you have anything that you want to add to 
this whole process of where we are? You have seen it from the 
private sector. Where you are today, do you see getting pinched 
from the standpoint of supply?
    Mr. Evans. Well, obviously, prices are and costs are going 
to go up with the tariffs now and have a knock-on effect as 
they will.
    Permitting, we've talked about, is critical to have 
certainty around that, if you're a private investor or tracking 
private investment. You know, things are measured in what your 
IRR is, your return, and those processes can go on seven or ten 
years and, basically, projects are abandoned or they go broke. 
So that's going to continue to be a challenge. Permitting, I 
think, is the first start.
    We talked about education, and I think that will help some 
of the things that Dr. Z. talked about here as well, by putting 
some of these things, it's going to spur more innovation around 
the country and be able for us to build new supply chains.
    Senator Manchin. Dr. Solan, if you could talk to us about, 
a little bit, what position you are in for the Department of 
Energy, where you all are going, how serious you take this and 
how committed are you?
    Dr. Solan. We take it very seriously, sir.
    I just wanted to echo the point that we see technology in 
innovation as the key behind this, and we thank you both for 
your leadership in the bills you've put forward. We definitely 
look forward to working with you throughout the process.
    One of the things that I wanted to mention too is 
leadership and innovation and technology is one of the things 
that we need to remember whether it's with critical minerals 
or, for example, hydrocarbon production in the past is that the 
unconventional eventually becomes conventional. And the only 
way that you do that is through R&D.
    So, for example, Dr. Ziemkiewicz talking about NETL's 
programs and the Office of Fossil Energy's programs that need 
to begin somewhere. They need to show results. And when that 
happens with partnerships with the private sector and academia 
and other stakeholders, we can help move things forward.
    Senator Manchin. Just to follow up on that. Everyone has an 
opinion on the tariffs and I look at a tariff, we have lost a 
lot of our desirability, if you will, to do some of the things 
we should always be doing for the building blocks for this 
great country. The steel and aluminum, if you don't have steel 
or aluminum production in your country, it is hard to maintain 
the superpower status. If these tariffs are driving back some 
of the things that should have never left, it is a good thing.
    If we are able to get back to where we can extract and 
produce and also refine to where we don't have to be dependent, 
wholly dependent, on subsidiaries outside and other countries, 
especially foreign entities who are not too favorable and do 
not really worry about our economy as much, it could be a good 
thing.
    This is one that I look at that could be if it gets us back 
into that. And I think the Department of Energy, you are going 
to be the one driving it so I don't know how much that 
Secretary Perry has, I'm sure, talking, conversing, with the 
White House on how important the rare earth minerals are that 
we are not producing, we are not refining, we are not doing 
anything. And that might spur that on to accelerate what we can 
into production commercially much quicker than just continuing 
to analyze.
    Do you know if there has been conversation there on a level 
from the Secretary to the White House?
    Dr. Solan. Not specifically regarding that. I can't say 
what the discussions have been.
    Senator Manchin. I am happy to follow up with him, but if 
you have a chance, you follow up yourself and this is something 
I think is very important for our country.
    Dr. Solan. Yeah, I could do that.
    Senator Manchin. Okay, thank you, Madam Chairman.
    The Chairman [presiding]. Thank you, Senator.
    I really appreciate the discussion that we have had this 
morning and just the information that you have shared with the 
Committee.
    One last question, and it is probably to you, Dr. Warner, 
and maybe you, Dr. Solan.
    As we think about the new technologies that are out there, 
the prospects for recycling, there is a lot of excitement and 
anticipation in terms of what that can yield. I have heard some 
suggest that we don't need to do more to access our own 
minerals here in this country. We don't need to make steps in 
that direction. We can recycle our way forward. I am wondering 
if we are being visionary enough in understanding what the 
demand going forward may be so that we are taking into account 
the broader increases in electrification, in the associated 
infrastructure, that in the future, is going to be relying on 
these.
    Can any of you give me your comments? Are we to the point 
where we can just rely on technology to allow us to meet this 
demand or do we need to continue to be the producer of these 
raw materials at the same time that we are working on the 
technology, because I think there are some who believe that 
there is a very easy way out of this and I would like to hear 
your thoughts on that.
    Dr. Warner.
    Dr. Warner. Thank you, Senator.
    I think that is an excellent question where we sit now in 
the industry. And I don't think that there's a one-size-fits-
all solution. I think that the recycling is absolutely going to 
be necessary with just the pure number of lithium-ion batteries 
coming into the end of life. But I think, and I think it could 
add to a significant portion of the minerals used, but I think 
it's going to have to be a policy that includes both the 
processing and the mining of natural materials and the refining 
of the used ones.
    There's new technologies happening today, such as the roll-
to-roll recycling, where they're able to pull cathode materials 
off, reprocess those and be able to use those. But those are 
still in their infancy stages. Today, most of the recycling 
processes will allow you to get some of the copper, some of the 
cobalt and some of the rare minerals out of there through a 
very expensive process that uses a lot of energy going into it.
    But I think going into the future, as we see more and more 
of these batteries coming out, as we look at our cell phones, 
every cell phone that we've got in the room here and probably 
sitting in Washington, DC, use the lithium cobalt oxide 
battery. All of those cobalt, what do we do with them when 
we're done? How many people have one or two sitting at home in 
a drawer somewhere? I know I do. If we have policies which 
would allow us to bring those back in and do some urban 
recycling, that could be another source of some of these raw 
materials.
    So I think that using some of the recycling technologies, 
continue to develop those recycling technologies will help 
supplement the need for some of the natural ones, but it will 
certainly help improve our--reduce our dependence on some of 
those foreign sources.
    The Chairman. Anybody else care to weigh in?
    Are the minerals that we have on the list, these are the 
ones that we have identified for today, but again, forecasting 
into the future, are we going to need to be adding more to that 
list, that we just have not even envisioned yet?
    Assistant Secretary Balash.
    Mr. Balash. Well, Madam Chair, I think that's why having a 
periodic reassessment of the list, every couple of years, is 
really important.
    The Chairman. Yes.
    Mr. Balash. Because over time the market demands will 
change, the technology will improve and draw on different 
pieces and parts of that list.
    So, you know, with that dynamism in mind, you can't just 
set the list one time and that's going to be it for 20 years. 
It just, it won't stand up.
    The Chairman. Alright.
    Dr. Solan.
    Dr. Solan. I agree with that, and one of the things we need 
to take a look at is constant evaluation. You bring up a very 
good point which is we really need to take a look at trying to 
forecast and figure out what's risky and what's not.
    The Chairman. Are we doing that?
    Dr. Solan. That's one of the things that we do at the 
Department of Energy. But some of the sensitivities that we 
have, particularly in some of the technologies you've 
mentioned, moving forward is how quickly is society going to 
electrify and are we going to, are automotive makers going to, 
follow through on their commitments on electric vehicles? How 
quickly might the consumer be brought to bear in terms of 
choosing electric vehicles and how quickly will battery 
technologies be used as storage for the grid? So these are all 
things that are important.
    You know, that said, we constantly take a look at these 
issues at Department of Energy according to a specific mineral 
or materials, importance to energy and also its supply risk. 
And in the past, going back in time, we actually thought that 
rare earth phosphors were going to be really important and had 
high supply risk, because at that time we thought compact 
fluorescent bulbs would be technology moving forward and 
technology of the future. And low and behold, it was not the 
rare earth phosphors. Now we're talking about gallium because 
industry has innovated, and now we have LED light bulbs that 
are actually penetrating in the market enough to move world 
markets.
    I'd just like to close and talk about that which is we have 
to take a look at this in terms of a global demand equation. 
All the different countries and companies around the world are 
competing for the same things, and much of the world's growth 
in demand is not going to be in the United States, it's in the 
rest of the world or it's in Asia. So in order for us to remain 
competitive, we have to take a look at our own supply chain and 
our own production.
    The Chairman. Very good.
    Dr. Ziemkiewicz.
    Dr. Ziemkiewicz. One of the things that we tend to overlook 
in this whole discussion is that markets themselves tend to be 
fairly elastic. And when I say that, the Washington Monument 
originally had an aluminum cap on it just to show the world how 
rich we were because aluminum prior to the Hall process was 
more valuable than silver. Now once the Hall process came 
along, then all of that useless bauxite in the tropics became a 
valuable ore.
    Well, I think the same thing may happen with some of the 
rare earths and critical minerals. For example, the cheapest 
rare earths right now go for about $8 per kilogram, $8,000 a 
ton. Well that blocks out a lot of markets. If we had the 
supply, if we had the low-cost processing, then all of a 
sudden, the price goes down, but the market increases in size. 
So we have to keep that in mind over making these assessments.
    The Chairman. Very interesting.
    We have had good input here today from Department of the 
Interior as well as Department of Energy, but I am reminded 
that it is the Department of Commerce that has led the 
development of a strategy to reduce this country's reliance on 
foreign minerals. We have been waiting to see that report for 
months.
    I am sorry that we have not seen that be released yet. We 
certainly are looking forward to that. But again, it is just a 
reminder that this is, kind of, a ``whole of government'' 
approach here when we are talking about our minerals and 
mineral security and what that means. It is not only what 
Interior does with accessing them from our lands, what Energy 
is doing to work on the technologies, but how that fits then 
from a broader view of Commerce, not to mention the perspective 
from Defense, obviously, very, very key to the discussion as 
well.
    I hope that Interior and Energy, just as you have outlined 
today, your Departments are working aggressively on this. 
Hopefully there is coordination with the Department of Commerce 
as we are talking about the broader strategy.
    You are nodding your head to affirm that that level of 
coordination is going on?
    Mr. Balash. Yes, ma'am.
    Dr. Solan. Yes, it is.
    The Chairman. You do not say that with levels of exuberant 
enthusiasm which kind of concerns me.
    [Laughter.]
    Can you give me any insight in terms of when we might 
expect this from Commerce on a release? I know it is not your 
Department, but what do you know?
    [No response.]
    The Chairman. Okay, there's a lot of cooperation going on 
between the three.
    [Laughter.]
    I won't hold you to that, but maybe I will follow up with 
the folks over at Commerce and see if we can rattle some cages 
over there.
    I thank you for the leadership that we are seeing, not only 
within our Departments but on the private sector side and in 
academia. This is an issue that will continue to be on my front 
burner in terms of priorities.
    I really feel like we did something extraordinarily 
significant when we were able to release the United States' 
potential when it came to reducing our vulnerability on oil by 
lifting the oil export ban. It was a policy that was holding us 
back. And it has really, truly helped make a difference when it 
comes to levels of vulnerability.
    But I fear that we are going in the same direction that we 
were previously with oil when it comes to minerals and our 
mineral security. That is not a place where I want to be. I 
don't think it is a place where any of us want to be. And it is 
going to take accessing these resources domestically, it is 
going to take the skilled workforce at all levels and it is 
going to take the ingenuity to build out these technologies.
    Dr. Ziemkiewicz, it has been fascinating hearing your 
report here today just in terms of what cool and neat things 
that we are finding in places that one would never have 
anticipated, nor expected. And just again, a reminder of the 
greatness that we have in so many of our learning institutions, 
our national labs and the bright people that we have that are 
focused on these difficult issues.
    Thank you for joining us, and thank you for your testimony. 
We will look forward to advancing both the bill I have been 
leading as well as Senator Manchin's, and would appreciate your 
continued input as we move forward with these.
    With that, the Committee stands adjourned.
    [Whereupon, at 11:56 a.m. the hearing was adjourned.]

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