How energy, refining and chemicals will play a key role in securing the future of US critical minerals
As the world transitions to alternative energy sources, the demand for critical minerals continues to grow. According to the IEA, lithium demand rose by nearly 30% in 2024 and demand for nickel, cobalt, graphite and rare earths increased by 6‑8%.
In the US, we are overly dependent on other countries to extract and process critical minerals needed for many everyday items, like smartphones, magnets, electric grids and batteries. The issue is not that the US does not have reserves of many of the minerals and metals in question—it is rather that we choose not to produce them.
The US wasn’t always behind on critical minerals. However, over time, we have ceded our global position and let our infrastructure age. Today, China dominates processing for many critical minerals, and if the US is going to effectively pivot the supply chain, we are going to need a game-changer, similar to transformations we have seen before in oil and gas.
We find ourselves in a position where to maintain our leading position in defense, energy and technology, we must reconsider where our technologies and products come from, how they are made and what they are made of in the first place.
To tackle the challenge, it is helpful to first understand the historical context of how we got here and how we can ensure that we have the critical minerals necessary to provide for society’s needs.
Understanding critical minerals and why they matter
The term “critical minerals” often sparks confusion, especially given that the US alone maintains three different lists. The most referenced is the Department of the Interior’s list, which highlights 50 minerals vital to national security and economic prosperity. Notably, only 13 minerals appear across all three US lists—graphite and lithium among them.
Critical minerals are foundational to modern technologies—defense systems, energy storage, electric vehicles and even smartphones. Graphite, for instance, is the largest component in most batteries, while lithium is essential for their functionality. And rare earth elements give color to screens and power magnets in electronics.
Value chains for critical minerals depend on extraction and processing. For extraction, you can’t control where the resource-rich rocks and formations are located, but you can control the extraction methods and controls used to improve project economics, environmental impact and a variety of other factors.
Why the US remains dependent on foreign critical mineral supply chains
Having access to these minerals is not the same as having control over them though. Alarmingly, nearly 100% of the critical minerals the US relies on are processed abroad. For 12 of the minerals on the Department of the Interior’s list, the US is entirely import-dependent, and for another 29, it is at least 50% reliant on foreign sources.
Strengthening the US supply chain of critical minerals involves more than just extracting more minerals. Associated minerals processing will be required to avoid recreating processing dependencies on unfriendly nations. Increasing dependence on imports, over time, the US has closed minerals processing plants. For example, though the US used to have closer to 20 aluminum smelters back in the 1990s, there are less than a handful left.
Many critical minerals come out in the processing of other metals. For example, take the critical minerals that China put export controls on in December 2024—gallium comes out of refining aluminum, germanium is from the smelting of zinc and antimony drops out of lead and copper. Though the US is not low on domestic copper reserves, less than a handful of US copper smelters remain.
Why affordable energy is essential for critical mineral processing
Energy is a key part of the materials equation as well. Part of the reason that the US has struggled to maintain smelters over the years relates to environmental laws and the cost of energy. The few smelters remaining in North America benefit from cheap energy from hydropower. In the mid-1900s, about 40% of aluminum smelters were in the Northwest, powered by hydroelectric dams.
Conservation efforts to increase salmon populations and increasing energy prices in the region have been cited as reasons for regional smelter closures. To increase our smelter capacity, affordable and reliable energy will be required, which could increase demand for nuclear, geothermal and other sources of energy.
Currently, the US operates only one rare earth mine, underscoring the urgent need for domestic development. However, extraction is only part of the equation. Processing is where the real bottleneck lies. Even if minerals are mined domestically or in allied nations, the lack of local processing capacity means continued dependence on foreign—often adversarial—sources.
The U.S. energy sector has faced similar challenges before. The shale revolution transformed the country from an energy importer to a global leader. A similar transformation is needed for critical minerals. Technologies like solution mining and direct lithium extraction offer promising avenues, especially in regions like the Smackover Formation in Arkansas and Texas, which are rich in lithium-bearing brines.
How refining and chemical expertise can accelerate critical minerals development
The refining and chemical industries already possess many of the skills needed to support this transition. US refineries excel in bottom-of-the-barrel processing. By repurposing fuel-grade coke, we can produce needle coke for synthetic graphite. About 80% of US refineries have a coking unit, and about 60% of the cokers in the US are Wood’s, previously known as Foster Wheeler’s, technology.
Elements like nickel and vanadium, which are traditionally seen as impurities, could also become valuable products. And techniques used in oil and gas, such as sulfur recovery and brine management, can be applied to lithium extraction.
Major oil and gas players are already investing in lithium projects. Partnerships between traditional energy companies and mineral specialists are becoming more common, combining expertise to accelerate development.
Solving our supply and processing problems is critical to material and energy security. By leveraging existing expertise, fostering innovation and building resilient supply chains, we can ensure a secure and sustainable future.