Europe’s Lithium Supply Chain Resilience and Investment Opportunities in Portugal

The global transition to clean energy hinges on securing resilient supply chains for critical minerals like lithium. As Europe seeks to reduce its dependence on Chinese-dominated refining and battery production, Portugal has emerged as a pivotal player. With the largest lithium reserves in Europe and a government accelerating extraction plans, Portugal is positioning itself as a cornerstone of the continent’s green industrial strategy. This analysis explores how Portugal’s strategic industrial policies and geopolitical foresight are creating compelling investment opportunities.

Strategic Reserves and Extraction Capacity

Portugal’s lithium reserves, estimated at 60,000 tonnes, are the largest in Europe [1]. Historically, the country’s output has been limited to lower-grade lithium for ceramics, but recent developments signal a shift toward battery-grade production. In 2025, the government plans to launch a long-delayed international tender for lithium prospecting licenses, targeting six regions in the north and center of the country [2]. Key projects like the Barroso Lithium Project (Savannah Resources) and Montalegre (Lusorecursos) are poised to supply lithium for up to 500,000 electric vehicles annually by 2027 [3]. These projects, designated as strategically important under the EU’s Critical Raw Materials Act (CRMA), will benefit from streamlined permitting and EU funding [4].

Government Policy and EU Alignment

Portugal’s center-right government, which took office in April 2024, has prioritized lithium development to align with the EU’s goal of reducing critical material imports. The CRMA mandates that member states secure 10% of their lithium needs domestically by 2030, a target Portugal is well-positioned to meet [5]. To accelerate progress, the government has streamlined mining regulations and introduced subsidy schemes for lithium-related technologies, such as agrivoltaics and solar pumping kits, which indirectly support energy infrastructure for mining operations [6]. These policies reflect a dual focus on economic growth and energy security.

Environmental and Geopolitical Considerations

Environmental concerns have historically stalled lithium projects in Portugal, but the government has emphasized rigorous assessments to mitigate ecological risks. For instance, the Barroso and Montalegre projects have received initial environmental approvals, with exploration slated for 2027 [7]. Additionally, Portugal is exploring innovative extraction methods, such as recovering lithium from geothermal energy sources, to minimize land disruption [8]. These efforts address both domestic environmental advocacy and EU sustainability standards.

Geopolitically, Portugal’s lithium expansion reduces Europe’s reliance on China, which currently dominates 70% of global lithium refining [9]. By producing battery-grade lithium locally, Portugal could cut EU imports by half by the 2030s [10]. This diversification is critical as tensions over resource access and trade wars escalate.

Investment Opportunities

For investors, Portugal’s lithium sector offers a unique confluence of strategic policy, EU funding, and market demand. The Barroso and Montalegre projects, with their CRMA-designated status, are prime candidates for capital inflows. Additionally, the 2025 tender will open new exploration opportunities, particularly for firms with expertise in sustainable mining.

Conclusion

Portugal’s lithium strategy exemplifies how strategic industrial policy can mitigate geopolitical risks while fostering economic resilience. By aligning with the EU’s CRMA and addressing environmental concerns, the country is not only securing its role in the green transition but also creating a robust investment ecosystem. For stakeholders seeking to capitalize on Europe’s decarbonization agenda, Portugal’s lithium sector represents a high-impact opportunity with long-term geopolitical and economic significance.

Source:
[1] Portugal plans to hold delayed lithium tender in 2025 [https://www.mining.com/web/portugal-plans-to-hold-delayed-lithium-tender-in-2025/]
[2] Portugal to issue tender for lithium prospecting licences in 2025 [https://www.mining-technology.com/news/portugal-lithium-prospecting-licenses-2025/]
[3] Portugal's Strategic Role in Europe's Lithium Mining Race [https://discoveryalert.com.au/news/lithium-mining-portugal-2025-strategic-resource-europe/]
[4] New lithium mines could cut EU imports by half [https://www.lunduniversity.lu.se/article/new-lithium-mines-could-cut-eu-imports-half]
[5] GSR 2025 | Global Overview [https://www.ren21.net/gsr-2025/global_overview/]
[6] Spotlight on Mining in Portugal [https://2025.minixeurope.com/spotlight-on-mining-in-portugal/]