Demand for Charlotte mining company’s lithium surges from data center growth

A dormant lithium mine outside of Charlotte has taken a significant step toward reopening. And the company that owns it, Albemarle Corp., the world’s largest lithium miner, reported a first quarter boost fueled by demand for lithium in energy storage for data centers handling AI.

Albemarle CEO Kent Masters expressed optimism about the company’s long-term trajectory, highlighting a diversified portfolio that remains resilient against geopolitical uncertainties. The Charlotte-based specialty chemical manufacturer’s strategy is focused on “operational excellence, cost and productivity discipline, and cash generation, to enable long-term volume and earnings growth,” Masters said.

“As the global operating environment remains uncertain, we are focused on the things within our control,” Masters said.

Kings Mountain mine: Securing the domestic supply chain

In a key development for the Charlotte region, Albemarle recently completed the federal permitting process necessary to reopen its Kings Mountain mine in Cleveland County, about 30 miles west of Charlotte. The site, dormant since the late 1980s, is one of the few places in the world where lithium mining is possible.

The U.S. Department of Energy National Energy Technology Laboratory issued a Final Environmental Assessment for the Kings Mountain project on March 30, finding “no significant impacts.”

“Federal approval is a noteworthy milestone in the project’s permitting process as we continue to engage with local and state entities to obtain their respective approvals,” said Scott Hutchins, senior director of business readiness for Albemarle in a recent company newsletter.

Albemarle has applied for 20 state and federal permits, and received 16 approvals. Permits are required to protect the local environment, including water, air, noise and land.

The reopening of the mine is a crucial part of the nation’s effort to secure its domestic supply of lithium. Once operational, the project is expected to produce about 420,000 tons of lithium-bearing spodumene concentrate per year.

Large green areas in white pegmatite rock called spodumene are extracted to make lithium. Lithium is used in batteries to power electric vehicles, bikes and personal electronic devices.

In February, Albemarle completed another milestone at the nearly 1,200-acre mine, completing dewatering of the open pit, a two-year process that treated and discharged 1.57 billion gallons of accumulated rainwater. The mine is designed to be water-efficient, collecting and using stormwater to support most of its operational needs.

In 2015, Albemarle acquired Rockwood Holdings’ Kings Mountain site. The company has not said how much the massive project will cost, but such projects can cost hundreds of millions of dollars. Albemarle is conducting comprehensive economic and environmental pre-development evaluations before making a final investment decision, Masters said.

“Bigger investment and bigger projects like Kings Mountain” would come after 2027, he said.

Albemarle’s quarterly results driven by energy storage and AI

The company’s first-quarter net sales through March 31 totaled $1.4 billion, a 33% increase compared to the same time last year. This growth was driven by higher volumes and pricing in the energy storage sector, which jumped 196%.

Albemarle is seeing a boost from energy storage systems made by AI companies to strengthen grid reliability for data centers. Data center power storage requirements are significantly higher than those used by electric vehicles.

“More than half of the company’s net sales now stem from the new energy sector, specifically electric vehicles and energy storage,” Masters said.

Financially, Albemarle also took aggressive steps to strengthen its balance sheet, paying down $1.3 billion of debt. Additionally, the company closed sales of its Eurecat joint venture and a controlling stake in spinoff Ketjen Corp., generating a combined $648 million in net cash proceeds.

Albemarle’s outlook remains steady despite global uncertainties

Looking ahead, Masters confirmed that Albemarle is on track to meet its five-year growth targets for energy storage. While global lithium consumption has surged 37% so far this year, reaching the upper range of the company’s 2026 forecast, Albemarle is maintaining a steady outlook due to global instability.

The global landscape remains varied, Albemarle executives said.

While U.S. EV sales were lower following reduced incentives, developing markets in Brazil, India and Australia saw a collective 74% year-over-year growth. European markets also continue to show robust growth, supported by strong policy initiatives in Germany, France and the UK.

Masters emphasized that the next phase of growth would be “capital-efficient, requiring little to no additional capex” as the company relies on its existing low-cost resources and joint ventures, such as the Wodgina and Greenbushes mines in Australia.

“We’ve managed through a challenging period and actively positioned the community as we look ahead,” Masters told analysts.

As of Dec. 31, Albemarle had about 7,800 employees companywide, including about 2,000 in the Charlotte region.

Catherine Muccigrosso

The Charlotte Observer

Catherine Muccigrosso covers retail, banking and other business news for The Charlotte Observer. An award-winning journalist, she has worked for multiple newspapers in the Carolinas, Missouri and New York.