How China pulled off a critical mineral production tech revolution in just 10 months
When a European start-up developed a breakthrough technology capable of transforming low-grade bauxite – once considered waste – into high-quality feedstock for aluminium production, they announced it at an industry conference in Miami, United States.
Six years on, an industrial complex based on the technology is up and running in China, just 10 months after construction began.
In Liulin, a coal-mining county in Shanxi province, the foreign technology conceived in France and Switzerland was rapidly engineered, permitted, constructed and commissioned inside a functioning industrial complex – the result of unprecedented coordination between a provincial government eager for transformation and a local energy industry determined to take the global lead.
The project, a partnership between French-Swiss firm IB2 and Shanxi Senze Energy Technology Group, marks the world’s first large-scale deployment of this revolutionary silica-removal technology.
It allows China to tap into its vast domestic reserves of low-grade bauxite, reducing reliance on imports from Guinea and Australia.
But beyond aluminium independence, greater value lies in what else the ore can produce: gallium, vanadium, lithium, niobium – and potentially rare earths – all materials at the heart of the clean energy revolution and modern warfare.
“China has 60 per cent of the world’s aluminium production. You cannot work in that industry without working with China,” Romain Girbal, chief executive and co-founder of IB2, said in an interview at the facility in Shanxi.
“Working with Chinese companies – they are so quick and so efficient. You could never go that quick anywhere else in the world – only in China. It is unique,” he said.
“It does not make sense for China to be so dependent on Guinea and Australia. We can bring back to China their mineral sovereignty,” he said after the inauguration ceremony last month of the technology’s first at-scale facility in the world.
Since the high silica content in low-grade bauxite would render the traditional extraction process inefficient, IB2’s solution to remove silica while preserving alumina is probably appealing to miners facing deteriorating ore quality.
“We are not saying that we will eliminate all the imports, but we can rebalance that,” Girbal said. “Maybe go back to 50/50 or something that is more acceptable for a country that wants to rely on its own resources in a world where deglobalisation is happening quite fast.”
China relies on imports for nearly 90 per cent of its supplies of the ore, according to a research note published by Dongxing Securities last year.
The US is also heavily dependent on foreign ore sources, importing “nearly all bauxite required for alumina manufacturing”, the US Environmental Protection Agency (EPA) states.
In a 2023 analysis of the bauxite supply chain, the agency rated its vulnerability as moderate to high, noting that America was “entirely reliant on imports”.
“The US has multiple sources of imports, which may provide some resilience to supply disruptions,” the EPA said, with the primary sources of imports being Jamaica and Brazil.
While the US holds small deposits of bauxite in the states of Arkansas, Alabama and Georgia, very little domestic mining of the ore takes place, according to the Aluminium Association, which represents the aluminium industry in the country.
This is why IB2 is also in talks with potential American partners to allow them to use more local bauxite, especially from the southern state of Arkansas, rather than relying on imports including from Jamaica.
The company is also looking to expand its operation to countries including Brazil, Saudi Arabia, Azerbaijan, Kazakhstan and India.
Yet for its first global rollout, the European firm selected China – drawn by its dominant market and the strong appeal of metal self-sufficiency for the country.
Girbal said the project had received “massive support” from the Shanxi government, which helped to push forward the process for a foreign company to build a local plant in compliance with relevant regulations.
The provincial government “understands what we do and [that] it is a game changer for their region, at least”, he said. “Building a unit in China is very regulated – environmental and dangerous materials [are subject to] heavier regulation.
“Of course we followed everything but we had the support from the Shanxi province to help us move forward. Sometimes, being a foreign company, things can be slow with communication issues. When there were sometimes slowdowns, they were here to help and to push.”
On the national level, Girbal said, “I believe what we bring to the table could change some of China’s policies on mining in China because they would realise that a lot of the local mines … can become very economical.”
The Chinese government “would realise that they do not have to keep building so many coastal refineries any more, now that inland refineries can become profitable”.
This might encourage the government to “incentivise more Chinese companies to mine local low-grade bauxite that is economical, that helps reduce dependency and increase mineral sovereignty,” Girbal added.
He said IB2 was testing bauxite from different regions, including neighbouring Henan and the coastal provinces, which had shown great potential to be processed using their technology.
“Our plan is to keep deploying as fast as possible in China with the right partners.”
While aiming to acquire seven clients in China over the next five years, IB2 will also increase the annual capacity at Liulin to process 3 million tonnes of low-grade bauxite in two years, according to Girbal.
Girbal described IB2’s partnership with coal and alumina producer Senze as its “real flagship” in China, because it was the first company to agree to the technological integration.
Liu Narong, executive deputy general manager of Senze Group, said that the company owned more than 10 bauxite mines but their high-quality ore reserves had been exhausted.
“The industry typically requires ore with alumina content of more than 50 per cent. Ores below these levels are considered substandard,” she said in an interview, adding that machines handling such materials could be damaged.
“The quality of bauxite has been steadily declining, which is a significant pain point.
“IB2 addresses this by upgrading low-grade bauxite, which can then be fed into the existing plants. It creates value from waste and allows for maximum resource utilisation.
“With the facility in operation, we have started processing the low-grade ore that had already been mined to utilise resources that were previously abandoned,” Liu added.
“Such technology is not yet available in China. When it could be adopted from overseas, we boldly embrace it. Nothing ventured, nothing gained.”
Liu said while imported aluminium ore was likely to remain the main supply source for the next two to three years, the policy factor of the reliance on foreign supply should not be ignored.
“With Guinea and Australia, fluctuations due to international political factors could affect imports and push up the prices of the ore,” she said. “The energy industry is mainly about competing on cost. Whoever has the lowest cost will survive and thrive.”
According to Beijing’s two-year plan for the aluminium industry released in March, “the resilience and security of the industrial chain and supply chain will be significantly improved” by 2027.
It also says China will “strive to increase domestic bauxite resources by 3 to 5 per cent and the output of recycled aluminium by more than 15 million tonnes”.
Chinese companies … they are so quick and so efficient. You could never go that quick anywhere else in the world, only in China.
Located in Liulin county of Luliang city, a coal town in the central province of Shanxi, Senze initially focused on coal production and processing and later expanded to bauxite mining and alumina production as part of its business transformation.
For IB2, “it was impossible” to find such efficient partners anywhere else in the world, according to Girbal, but the Chinese firm displayed efficiency that surpassed their expectations.
“[Setting up the facility] was quick because working with Chinese companies … they are so quick and so efficient. You could never go that quick anywhere else in the world, only in China. It’s unique. It’s unique … It’s impossible.”
When asked about their experience working with the European company, Liu pointed out the significant cultural differences.
“They are particular about following procedures and leaving a paper trail through emails. Chinese people may feel that this is not very efficient, but their practice is, in fact, more in line with management conventions,” she said.
“For projects that we lead, after the funding is secured, our time frame for completion is usually three to five months, never extending into the next year. Our boss kept asking about the latest progress of the facility and when production would begin.”
The company produces 1.3 million tonnes of alumina a year, valued at 3 billion yuan (US$423.7 million), and operates a gallium production line with an annual output of 40 tonnes.
“We want to change this by helping them produce concentrates that need to be refined at the end with the right partner,” he said.
“Critical metals and rare earth elements are present in pretty much all the bauxite in the world. Until recently, they were mostly wasted.
“IB2 has huge potential in critical metal recovery, and potentially in rare earth which is recovered in a different way. We are looking at an electromagnetic type of technology because rare earth elements do not dissolve the same way in soda.”
Xavier Perrier, project director and technical expert at IB2, said: “By removing silica, we take the percentage of aluminium from 48 to 70 per cent. This means that removing the silica gives them a quality of bauxite that never existed – not only low [in] silica but also very high [in] alumina.”
After bauxite is roasted at high temperatures, the ore is ground and mixed with hot caustic soda. Silica is thus dissolved and removed from the ore. The liquor would then be desilicated with lime, forming calcium silicate, or tobermorite, a by-product that could be used in cement, he explained.
The hot caustic soda stays in the loop, where it gets enriched with critical metal. When they reach a critical concentration, these metals can be isolated and extracted, Perrier added.
These critical metals include gallium for semiconductors; niobium, an alloying element in steel products; vanadium, used to strengthen steel; and lithium, best known for its use in batteries, according to the IB2 website.
The company is also conducting research to develop ways to recover rare earths including cerium, neodymium, lanthanum, europium and yttrium from bauxite.
China has 3 per cent of the world’s total bauxite reserves, according to a paper published in the peer-reviewed journal Minerals Engineering in May, where Chinese researchers presented their innovative method to enhance alumina extraction from low-grade bauxite.
“The rapid expansion of China’s aluminium industry has led to a surge in alumina production demand, accelerating the depletion of high-quality bauxite resources,” researchers from the Chinese Academy of Sciences and metal companies in the central Henan province wrote.
“Additionally, there exists a substantial amount of underutilised low-grade diasporic bauxite in China, further constraining the development of the Chinese aluminium industry.”