Hurricane Helene's devastation has shut down a one-of-a-kind mine for AI chips

• Hurricane Helene tore through North Carolina over the weekend, causing widespread devastation.
• The storm has temporarily closed a one-of-a-kind mine in the town of Spruce Pine, and it could have global ramifications.
• The area is the primary source of high-purity quartz, a key material for making semiconductors.

A mine in a small town in North Carolina that is essential to producing the world's semiconductors has been temporarily closed after Hurricane Helene battered the area.

Spruce Pine is home to two mines that are a key source of high-purity quartz. This crucial material is used to make the chips that power everything from smartphones to data centers, with experts warning that any long-term damage risks disrupting global supply chains.

Sibelco, the owner of one of the mines, confirmed in an email to Business Insider that it halted operations as of September 26 due to the "significant impact" of Hurricane Helene.

"The hurricane has caused widespread flooding, power outages, communication disruptions, and damage to critical infrastructure in the area," said a Sibelco spokesperson.

The company said it had confirmed the safety of most of its employees but was still trying to contact those left unreachable by power and communications outages. Sibelco said it's working with its local team and North Carolina authorities to restart operations as soon as possible.

Hurricane Helene tore through North Carolina over the weekend and has left more than 130 people dead in the US since it made landfall last week.

Spruce Pine was hit with over 2 feet of rain between Tuesday and Saturday, The Associated Press said.

A Facebook post from the county government described the flooding as "catastrophic" and said a "good bit" of the county's infrastructure had been destroyed or damaged by floodwater. North Carolina's live traffic map shows that the storm affected roads near the mines.

The official website for Mitchell County, which includes Spruce Pine, said Monday that a road that's a five-minute drive from the mines was partially closed because of a "partial washout."

"We ask that you please limit unnecessary travel to conserve fuel and other resources," the Spruce Pine Police Department, which did not immediately respond to a request for comment, wrote in a Facebook update on Sunday.

Supply-chain 'pinch point'

The town's quartz mining sites are run by two companies, Sibelco and Quartz Corp.

The two firms play a huge role in the global supply chain that ultimately ends in smartphones and powering cutting-edge AI systems.

The ultrapure quartz mined at Spruce Pine is essential for making silicon wafers, a key component in semiconductors manufactured by the likes of the Taiwanese tech firm TSMC.

On Monday, a spokesperson for Quartz Corp. declined to comment on the hurricane's impact and said it was too early to assess any effect on quartz production. The spokesperson added that the company's priority was people.

Ed Conway, a Sky News journalist and author who has written a book about precious-material supply chains, described the two mines as an "incredibly" important "pinch point" in the global supply chain.

He told Business Insider that making silicon wafers requires melting down nearly pure silicon in a crucible made from high-purity quartz — of which the only large-scale source is the North Carolina mines.

"It's the only place that we've discovered a very large resource of this particularly high-purity quartz," he said.

"If we don't have access to those mine for a long period of time, then the global supply of these silicon wafers is under threat," Conway added.

Yinan Wang, a geologist, said, "The quartz in Spruce Pine formed deep in the Earth without a lot of water carrying in other impurities."

Seaver Wang, a codirector of the climate and energy team at the Breakthrough Institute, told BI in an email that most chipmakers "likely maintain some stockpiles to ride out a short disruption."

But the extent of damage will determine the ultimate impact on semiconductor supply, Wang said, adding that while the mines are on high ground, it could take weeks to restore roads and power.

"If the mines resume operations within a few weeks, the impact may be minimal," he said. "If more serious damage occurred at the mines, then both the chip and solar industries could see supply chain shortages and price spikes."

That's because the Spruce Pine mines are singular in their scale, he said.

"Other existing or new mines would take many months or years to ramp up, respectively," he said.