It's not a warm welcome for the glamorously dressed guests arriving for the Caceres Spanish Cinema Festival. "No to the mine! Yes to life!" a few hundred protesters chant, lining either side of the street leading to the Grand Theatre. "Caceres isn't for sale!" they shout. "The shame!"

How did a local film festival get mixed up in a mining dispute? It's all to do with an event sponsor, Extremadura New Energies, the company gunning to produce 467,000 tons of battery-grade lithium hydroxide over 26 years by mining the earth just a few kilometers away from the theatre. The company hopes such gestures, funded by a foundation, will convince the community of its honourable intentions. Anti-mine activists from the Save Caceres Mountain Platform see it as a cheap ploy.

Caceres is a sleepy city of 100,000 inhabitants popular with tourists for its UNESCO-recognized Old Town. It's situated in Spain's poorest region — rural and often overlooked Extremadura on the Portuguese border. Around six years ago, it also joined the growing list of European communities caught up in a geopolitically charged global resource race.

Race for 'white gold' hits Europe

Lithium is a metal used in the high-performing batteries, key for carbon emissions-busting technologies like solar panels and electric vehicles, plus smartphones and laptops. Australia, Chile and China are the world's biggest producers with a 90% market share, according to World Economic Forum figures. Its extraction, particularly in South American salt flats, has been associated with environmental degradation, water scarcity and — in Bolivia — heavy political backlash.

On Thursday, the EU Commission presented regulation designed to wean off import dependency for so-called critical materials needed for future-proof technology. The EU's executive arm set a 2030 target for the EU to extract at least 10% of strategic critical raw materials such as lithium and cobalt the bloc consumes within its own borders where possible. By the end of the decade, the EU should meet 15% of its own recycling needs and also 40% of its processing needs materials as well. Furthermore, the bloc should diversify its suppliers, particularly to ease dependency on China.

No surprise in Caceres

Montana Chaves, spokesperson for protest organizers — the Save the Caceres Mountain Platform — says the new EU plan "worries us a lot."

The group has myriad concerns: the strain on local water supply — no river runs through Caceres — air pollution from increased road traffic, contamination of water and soil through chemicals used in mining and refining, dust, noise, and even the potential it could destabilize the ground Caceres stands on through the use of explosives.

For Chaves, the Sierra de la Mosca hill, which stands between the city and the proposed mining site, has a strong personal meaning. Like many women in the area, she is named after it, or rather the patron saint of Caceres, the Virgin of the Mountain.

"Since I was a little girl, I have had a strong connection with this land," she told DW, which is why she and other locals have spent years fighting the mine.

It seems though that not everyone feels the same.

"It's fantastic," said 76-year-old Jose-Antonio, who declined to give his surname when talking to DW. "Caceres is a city of retirees and pensioners, nothing else." 

He himself is a retired agricultural engineer and believes the city needs jobs. Out strolling with Jose-Antonio on the winding shopping street was Hugo Galeano,  a 23-year-old tourism student. He sees things similarly. "There's no industry here. Tourism alone isn't enough, the town needs an economic motor," he said.

In the EU, lithium demand is driven in large part by the automotive industry. The sector accounts for 7% of the bloc's economic output and has big plans to electrify. The EU is planning to phase out the sale of combustion-engine cars by 2035 as part of a wider climate goal to reduce CO2 emissions to "net zero" by 2050.

Given the political and business impetus for such projects, you might think anti-mine campaigners in Caceres wouldn't stand a chance. But the group already scored a victory in 2017 by mobilizing the city's population against original plans for an open-cast mine. With local government also opposed, Extremadura New Energies had to go back to the drawing board. It came up with a plan for an underground mine with additional plants and facilities nearby.

Lithium mine, round two

Mayor Luis Salaya of the centre-left Socialist Party opposed the original plan, but is more open to the new proposal, which was officially submitted late last year and is still under review by local authorities.

Extremadura New Energies chief executive officer Ramon Jimenez believes the community is now coming round.

"When I explained that it is underground, that we're not going to use sulfuric acid or natural gas, that we are going to heat the process using green hydrogen generated with our own solar energy, that we are going to use water from the sewage treatment plant — people see that the impact has been reduced to the minimum possible and see the possible benefits," he told DW.

The project should create several hundred long-term jobs, as well as lining state coffers with tax payments, said Jimenez, who thinks the project is an example of a good mine with high standards. He argues lithium has to be mined somewhere, so it is better to do it in the EU, where there are stricter environment laws. Moreover, the refined lithium would be sold to car companies in Spain and the EU, rather than getting shipped in from China. "They're nimbies! Not in my backyard!," he said of his opponents.

Miners 'normally get their way'

Gavin Mudd, a professor of environmental engineering from RMIT University in Australia, thinks there's a lot of uncertainty surrounding the long-term impact of lithium mining. He told DW on the phone that hard-rock mining — the kind proposed in Caceres — is different to the solar evaporation process that creates the vividly colored pools seen on South American salt flats.

The things Extremadura New Energies promises are technically possible, but so are many of the downside risks mentioned by activists, theoretically. Ultimately it depends on the design and running of the mine in question, said Mudd.

in Spain, the mining industry has a bad reputation with good reason, he noted, pointing to the legacy of pollution from previous mining in the southwest of the country. "Miners, of course, are not used to being told what they're allowed to do and what they're not allowed to do. They normally get their way," Mudd said, adding that communities should be able to say "no" to a mine, but in reality, successful resistance is rare.

One example is Jadar, a region of Serbia that was set to become home to Europe's biggest lithium mine. But last year, Anglo-Australian mining giant Rio Tinto had its license revoked amid public protests. Plans for the Mina do Barroso mine in northern Portugal have also been heavily contested.

Whether or not Caceres does ultimately see a mine built, demand for lithium is unlikely to go away any time soon. The EU Commission has estimated that the 27-nation bloc would need up to 18 times more lithium by 2030 and 60 times more by 2050 to meet its climate goals, which rely heavily on e-mobility. 

CEO Ramon Jimenez, at least, is confident Extremadura New Energies will succeed in Caceres and hopes mining will start as early as 2024. In fact, the company already has its eyes on other potential sites — ones that are "sustainable and economically viable."

"Some are in Spain, some in Europe, some in Australia," he said, without disclosing, of course, where he's expecting to mine more of the "white gold." 

Edited by: Uwe Hessler