BERLIN, March 6 (Reuters) - Germany could have enough

lithium reserves to cover its domestic needs for several

decades, a study showed on Thursday, as Berlin seeks to boost

its electric vehicle production and cut dependency on critical

raw material imports.

The German Raw Materials Agency estimates the country's

lithium demand at up to 0.17 million metric tons per year by

2030. Germany's automotive industry relies on imports from

Australia, Argentina, Chile and China to cover its battery

production needs.

Researchers and companies have been exploring ways to

extract lithium as a byproduct of geothermal energy production

in Germany's Upper Rhine Valley to boost domestic supply and

renewable heating and power solutions.

A study by the Federal Institute for Geosciences and Natural

Resources and Fraunhofer IEG institute found that Germany had up

to 26.51 million metric tons of lithium reserves, dissolved in

deep underground waters, particularly in the North German Basin

and the central Thuringian Basin.

"This assessment of potential is new. When you add

everything up, it turns out there could indeed be surprisingly

high lithium resources lying dormant underground," Katharina

Alms, the research leader at Fraunhofer IEG, told Reuters.

In 2021, geologists estimated that the Upper Rhine Valley in

the Black Forest area of southwestern Germany held enough

lithium for more than 400 million EVs.

Lithium exploration has gained momentum in Germany despite

concerns over difficulties of extracting it.

ExxonMobil ( XOM ) subsidiary Esso Deutschland received four

exploration licences in Lower Saxony in December. German oil

firm Neptune Energy said in August it received exploration

permits for the eastern state of Saxony-Anhalt.

However, Alms said extracting lithium in Germany faces

several challenges as not all locations contain high

concentrations, making exploration unpredictable.

Many identified lithium resources are also trapped in

low-permeability rocks, making extraction technically difficult

and surface extraction techniques sometimes require specialized

methods that can be complex and time-consuming to implement on a

large scale, she added.

Germany imported 23.7 billion euros worth of batteries in

2023, with lithium batteries accounting for 86%, according to

trade group ZVEI.