The Industry Ministry is interested in further exploration of lithium in Phangnga's Takua Thung district to serve the growing electric vehicle industry after an initial survey found some areas are likely to have this element, which can be used to make lithium-ion batteries for EVs.
The exploration at Ruangkiet area found pegmatite, a rock from which lepidolite is derived.
Lepidolite is known as a lithium-bearing mineral.
Officials believe Ruangkiet can be developed into a mine to extract lithium with a grade of 0.45% lithium oxide, said Aditad Vasinonta, acting deputy director-general of the Department of Primary Industries and Mines.
The department granted special licences to explore lithium in three areas in Takua Thung district. Two of them are Ruangkiet and Bang E-Thum. The two Australian companies active in Thailand are Pan Asia Metals and Matsa Resources.
Officials are conducting a detailed survey at Bang E-Thum to find traces of lithium, said Mr Aditad.
Ruangkiet is expected to have sufficient lithium to produce 50-kilowatt-hour lithium-ion batteries for 1 million EVs, he said.
"The government expects to use lithium to support the EV industry and make Thailand a more attractive investment destination for manufacturers," said Mr Aditad.
Southern Thailand was once a key tin mining area in the late 19th and 20th centuries before the region along the Andaman Sea was turned into a tourist destination.
Industry Minister Pimphattra Wichaikul said the government is also developing technology to reuse and recycle batteries in order to make "second-life EV batteries".
These batteries can serve small electric cars and electricity usage in homes and factories.
The ministry wants to increase EV production, aiming to produce 359,000 EVs with investment of 39.6 billion baht this year.
The state EV incentive package, dubbed EV3.5, is expected to play an important role in fuelling the growth of the EV industry.
EV3.5 covers subsidies, reduced import duties for fully assembled cars and an excise tax cut. Companies participating in this scheme spanning 2024-27 are required to start producing EVs domestically from 2026.