LISBON - Portugal's long-awaited lithium licensing auction could be launched within two months after an environmental assessment gave the green light to mining the metal in six areas, the government said on Wednesday.

The auction, initially planned for 2018, has been repeatedly postponed due to concerns over the environmental and social impact of lithium mining.

It is part of a plan to make Portugal Europe's top supplier of the metal for electric car batteries, helping meet an expected surge in global demand for lithium.

Portugal is already Europe's biggest lithium producer but its miners sell almost exclusively to the ceramics industry and are only now gearing up to produce higher-grade metal for batteries.

The environment ministry said the environmental assessment conducted by the energy and geology agency analysed eight lithium-rich areas in central and northern Portugal, concluding "there were conditions to move forward in six of them".

"Within the next 60 days, the auction procedure to award lithium prospecting and research will advance," it said in a statement. "After the auction and prospection, to be carried out within a maximum period of five years, lithium exploration may begin."

It added that, in the six areas to be auctioned, mining would be not be allowed in areas of high urban and population density.

Licences to search for the metal in other areas have already been granted. The environment regulator has given preliminary approval to an environmental study by London-based Savannah Resources to mine in the Barroso region, a world heritage site for agriculture.

Lithium projects in Portugal face strong opposition from environmentalists and local communities, who are demanding stronger regulation and more transparency.

They have expressed concern about irreversible environmental damage such as soil pollution and destruction of the natural habitat of various endangered species.