A Missed Opportunity in the Global Mining Landscape
The global mining industry is constantly evolving, with multinational corporations seeking untapped markets to meet the growing demand for minerals and metals. For Europe, one of the most intriguing yet unrealized opportunities lies in Iran—a nation rich in natural resources but hindered by geopolitical tensions and sanctions. Among the European companies that stand to lose significantly from this situation is Eramet, the French mining and metallurgy giant. With its expertise in extracting and processing high-demand metals such as nickel, manganese, and lithium, Eramet is uniquely positioned to benefit from Iran’s underdeveloped yet resource-rich mining sector. However, due to the European Union’s alignment with U.S.-led sanctions and political hesitancy, this potential remains untapped, representing a considerable economic loss for both Eramet and the EU.
Iran’s Mining Wealth: A Hidden Treasure
Iran is often recognized for its oil and gas reserves, but its mining wealth is equally significant. According to the Fraser Institute’s Global Mining Report, Iran ranks among the top 15 countries globally in terms of mineral reserves, boasting an estimated 68 types of minerals and more than 37 billion tons of proven reserves. These include vast deposits of manganese, nickel, lithium, and rare earth elements—resources that are vital to the global energy transition and industrial supply chains.
- Manganese Reserves: Iran holds substantial manganese reserves, particularly in the provinces of Kerman and Zanjan. Manganese is a critical input for steelmaking and battery technologies—two sectors in which Eramet is deeply involved.
- Nickel Deposits: Iran’s nickel deposits remain largely untapped and could be of great interest to Eramet, which operates one of the world’s largest nickel mines in New Caledonia. Nickel is essential for stainless steel production and electric vehicle (EV) batteries, industries experiencing exponential growth globally.
- Lithium Potential: While not as explored as other minerals, Iran’s potential for lithium production could align with Eramet’s recent expansion into lithium extraction, particularly given the metal’s importance in EV batteries and renewable energy storage.
Eramet’s Expertise: A Perfect Match for Iran
Eramet is one of Europe’s leading mining companies, with operations spanning across Africa, Asia, and the Americas. Its focus on manganese, nickel, and lithium, coupled with its leadership in sustainable mining practices, positions it as an ideal partner for developing Iran’s mining sector.
For example:
- Eramet’s manganese operations in Gabon are among the most efficient in the world, accounting for approximately 15% of global supply. Replicating this success in Iran could significantly boost global supply chains while providing Eramet with a new revenue stream.
- The company’s expertise in hydrometallurgy and other advanced extraction methods could help modernize Iran’s mining infrastructure, which has lagged due to underinvestment and sanctions.
Moreover, Eramet’s strategic focus on metals critical to the energy transition aligns perfectly with Iran’s untapped resources. The global push for decarbonization has increased demand for these materials, making Iran’s reserves even more valuable. However, by staying out of the Iranian market, Eramet is missing a chance to secure long-term supplies of these critical minerals.
Economic Losses for Eramet and the EU
The absence of Eramet and other European mining companies in Iran represents a significant economic loss. According to Iran’s Ministry of Industry, Mining, and Trade, the country’s mining sector could generate up to $22 billion annually if fully developed. European companies could have claimed a share of this market through joint ventures, technology transfers, and infrastructure development.
For Eramet specifically:
- Manganese and nickel demand is projected to grow by 30% by 2030, driven by the rise of EVs and renewable energy technologies. Iran’s reserves could have provided a low-cost, high-yield source of these metals for Eramet, reducing its reliance on other markets.
- The company’s 2022 revenue stood at €5 billion, with a significant portion coming from manganese and nickel operations. Access to Iran’s resources could have boosted this figure by an estimated €500–€800 million annually, based on Iran’s production potential and export prices for these metals.
From a broader EU perspective, Eramet’s inability to operate in Iran also limits the bloc’s strategic diversification. Europe faces increasing competition from China, which has already established a strong foothold in Iran’s mining sector. For instance, Chinese companies have invested heavily in Iran’s copper and rare earth projects, securing long-term supply agreements. By contrast, EU companies like Eramet remain sidelined, leaving Europe more dependent on external suppliers and vulnerable to supply chain disruptions.
Strategic and Employment Losses
Beyond monetary losses, Eramet’s absence in Iran has broader strategic implications. Developing Iran’s mining sector could have created thousands of jobs both within Iran and across Europe, particularly in engineering, logistics, and technology development. For France, which continues to face high unemployment rates in certain regions, a partnership with Iran could have provided much-needed economic stimulus.
Moreover, Eramet’s focus on sustainable mining could have positioned the EU as a leader in responsible resource extraction, countering criticism that Chinese investments often overlook environmental and labor standards. By forfeiting this opportunity, the EU has not only lost economic benefits but also the chance to set global standards for ethical mining practices.
The Path Forward
While the current geopolitical climate makes EU-Iran cooperation challenging, it is not impossible. The 2015 Joint Comprehensive Plan of Action (JCPOA), or Iran nuclear deal, briefly opened the door for European companies to explore opportunities in Iran. Although the U.S. withdrawal from the agreement in 2018 led to renewed sanctions, diplomatic efforts to revive the deal continue. If successful, Eramet and other EU mining companies could finally access Iran’s vast resources.
To prepare for such a scenario, Eramet should consider:
- Establishing preliminary agreements or partnerships with Iranian mining firms, contingent on sanctions being lifted.
- Exploring joint ventures to modernize Iran’s mining infrastructure, leveraging Eramet’s expertise in sustainable and efficient extraction.
- Advocating for a coherent EU strategy on Iran that balances economic interests with geopolitical considerations.
Eramet’s absence in Iran underscores a broader issue for the EU: the economic and strategic opportunities lost due to political constraints. As the world transitions to a low-carbon future, access to critical minerals like manganese, nickel, and lithium will become increasingly important. By not engaging with Iran, Eramet and the EU are not only losing out on billions in potential revenue but also ceding ground to competitors like China. It’s time for Europe to rethink its approach to Iran, ensuring that companies like Eramet can compete on the global stage while fostering sustainable development in one of the world’s most resource-rich nations.
