Focus: Automakers funding new tech aimed at making greener lithium for EVs

KSK Energy Ventures

07/10/2021 21:57

By Ernest Scheyder
    CALIPATRIA, Calif., Oct 7 (Reuters) - Automakers, investors
and even oilfield giant Schlumberger NV  SLB.N  are beginning to
embrace environmentally friendly technologies to produce lithium
that could help meet 25% or more of global demand for the
electric vehicle battery metal by the end of the decade.
    Stellantis  STLA.N , Bill Gates' Breakthrough Energy
Ventures and others have invested millions of dollars or signed
supply agreements with so-called direct lithium extraction (DLE)
start-ups in recent months in an attempt to propel the
technology to commercial production, expected within the next
year or two.
    DLE technologies use less land and groundwater than hard
rock mining and brine evaporation ponds - the traditional ways
to process the white metal. Industry analysts see it as a new
way to help ensure lithium supply for the EV industry - if the
technology can work on a large scale.
    "More green lithium is the promise of this new technology,"
said Kasper Sage of BMW i Ventures, BMW's  BMWG.DE  venture
capital fund, which this week invested https://www.reuters.com/business/autos-transportation/bmw-invests-lithium-technology-startup-lilac-solutions-2021-10-06
 in DLE tech start-up firm Lilac Solutions Inc.
    DLE technologies are comparable to common household water
softeners, which remove metals from drinking water.
    The process can take as little as a few hours to filter the
metal inside an average-sized warehouse. By contrast,
traditional evaporation ponds can be hundreds of acres in size,
permanently drain nearby aquifers and take several years to
produce lithium. 
    However, most DLE technologies are more expensive to operate
than evaporation ponds, which use sunlight, and some require
large volumes of freshwater and electricity. 
    Albemarle Corp  ALB.N  and other traditional lithium
producers say they have studied DLE technologies but feel they
will not go mainstream until later this decade, given worries
about high energy and water use.
    "Access to clean water is one of the key hindrances to DLE,"
said John Peichel of Suez PA's  SEVI.PA  water technology
division, which sells equipment to the lithium industry. 
    Schlumberger, known for its hydraulic fracturing work, is
building a DLE project in Nevada and says its "ultimate goal" is
to produce lithium without any freshwater. It is a goal the U.S.
Department of Energy is supporting with a $4 million contest for
the best geothermal lithium technological developments.
       
    WALL STREET
    The potential hurdles have not hindered Wall Street's
interest in so-called green lithium. 
    Standard Lithium Ltd.'s  SLI.N  shares have risen six-fold
since they started trading in New York in July, even though the
company's DLE technology is still being piloted in Arkansas.
    Australia's Vulcan Energy Resources Ltd  VUL.AX  shares are
up 40% since August on its plans to supply automakers https://www.reuters.com/business/autos-transportation/renault-locks-lithium-supply-vulcan-energy-five-year-deal-2021-08-02
 Stellantis and Renault SA  RENA.PA  from its German DLE
project.
    Chris Berry, an independent industry analyst with House
Mountain Partners, says that based on existing announcements,
DLE could produce a quarter of global lithium supply by the end
of the decade, though he noted not all technologies should be
treated as equal. Other industry consultants put that figure
even higher.
    Global demand for lithium last year was about 320,000
tonnes, and is expected to hit 1 million tonnes by 2025 and 3
million tonnes by the end of the decade. 
    "Investors need to weigh the benefits of DLE technology
against a host of challenges in tailoring the technology to each
lithium deposit," Berry said.
    One area drawing attention from DLE developers is
California's Salton Sea, roughly 160 miles (258 km) southeast of
Los Angeles. Superhot brines teeming with lithium swirl under
the area, which sits atop the San Andreas Fault.
    Warren Buffett's Berkshire Hathaway Inc  BRKa.N  and
EnergySource LLC are studying ways to add DLE technology to
existing power plants there so they can process lithium while
producing electricity. 
    Nearby, privately held Controlled Thermal Resources Ltd is
developing a geothermal lithium brine project to supply General
Motors https://www.reuters.com/business/autos-transportation/gm-shakes-up-lithium-industry-with-california-geothermal-project-2021-07-02,
 which said CTR could supply "a sizeable amount of our lithium
needs" by 2024.
    That project, as well as a similar one in Argentina https://www.reuters.com/business/sustainable-business/australias-lake-resources-teams-up-with-clean-tech-firm-lilac-develop-argentina-2021-09-21,
 are backed by technology from Lilac Solutions and seen by some
analysts as one of DLE's first commercial tests.
    The DLE attention comes as prices for lithium are near
all-time highs, according to data from Benchmark Mineral
Intelligence, fueling the race for new technologies.
    "Lithium supply is the main bottleneck to electrification
and DLE can help boost that supply," said Teague Egan, chief
executive of Energy Exploration Technologies Inc, a privately
held company working with Argentina lithium producer Orocobre
Ltd  ORE.AX .

    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
BMW invests in lithium technology startup Lilac Solutions   
 urn:newsml:reuters.com:*:nL1N2R121V
Lake Resources teams up with clean tech firm Lilac to develop
Argentina lithium project     urn:newsml:reuters.com:*:nL4N2QN3J5
GM shakes up lithium industry with California geothermal project
    urn:newsml:reuters.com:*:nL2N2OD3AW
Stellantis in lithium supply deals with California, German firms
-sources      urn:newsml:reuters.com:*:nL2N2OL1HC
Compass Minerals jumps on finding 2.4 mln metric tons of lithium
resource      urn:newsml:reuters.com:*:nL4N2OQ313
U.S. to work with allies to secure electric vehicle metals   
 urn:newsml:reuters.com:*:nL2N2NQ15Z
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 (Reporting by Ernest Scheyder; Editing by Dan Grebler)
 ((ernest.scheyder@thomsonreuters.com; Twitter: @ErnestScheyder;
+1-713-210-8512; Reuters Messaging:
ernest.scheyder.thomsonreuters.com@reuters.net))