The Salton Sea could produce the world’s greenest lithium

About 40 miles north of the California-Mexico border lies the landlocked, narrow lake known as the Salton Sea. Once the epicenter of a thriving resort community, water contamination and decades of drought have contributed to the collapse of the lake’s once vibrant ecosystem and spawned ghost towns.

But in the midst of this environmental catastrophe, the California Energy Commission estimates that there is enough lithium here to meet all projected future demand from the United States, and 40% of global demand. This is big news for the burgeoning electric vehicle industry, as lithium is the common denominator in all types of electric vehicle batteries.

Traditionally, lithium mining involves either surface mining or evaporation ponds, which work by pumping lithium-containing brine to the surface and waiting for the water to dry up. Both of these methods have huge land footprints, are often very water greedyand can create many pollution and waste.

But at Salton Sea, three companies are developing chemical processes to extract lithium in a much cleaner way, taking advantage of Salton Sea’s rich geothermal resources. Near the lake, there are already 11 geothermal power plants in operation, ten of which belong to Berkshire Hathaway’s renewable energy division, BHE Renewables.

“We already pump 50,000 gallons of brine per minute across all of our ten geothermal facilities to the surface,” said Alicia Knapp, President and CEO of BHE Renewables, “and we use the steam from that brine to generate clean energy. And so we’re really halfway there in that we have the lithium here in our hands. »

Two other companies, EnergySource and Controlled Thermal Resources, or CTR, are also developing joint geothermal and lithium facilities at the Salton Sea, and General Motors has already committed to sourcing lithium of the CTR.

This new industry could be a major economic boon to the region, where the predominantly Mexican-American community faces high rates of unemployment and poverty, and suffers the health effects of toxic dust seeping from the bed of the dry lake in the Salton Sea.

“We’re cautiously excited about Lithium Valley,” said Maria Nava-Froelich, acting mayor of Calipatria, the town of about 6,000 people where the geothermal power plants are located. “We see it as a game changer here for Imperial County.”

Nava-Froelich hopes the industry will bring much-needed jobs and development to the region, helping to revitalize communities that have seen an exodus of young people seeking opportunities elsewhere. And conservationists hope the influx of attention and money will speed up California’s efforts to restore the environment in and around the Salton Sea.

If there was a time to bet on national mining projects, it might be now. In late March, President Biden invoked the Defense Production Act to boost production of electric vehicle battery minerals like lithium, nickel, cobalt, graphite and manganese.

But extracting lithium from geothermal brines has never been done on a large scale, so it remains to be seen what benefits the electric vehicle industry, the local community and the environment will actually see.

This is not the first time that interest has been shown in the recovery of lithium in the Salton Sea. Successful start-up Simbol Materials previously developed a demonstration plant, but the company ceased operations in 2015 after a failed acquisition attempt by Tesla, and never developed a commercial-scale facility.

Since then, demand for lithium has exploded and, after falling sharply in 2018, prices are rising again, encouraging projects that might not have been profitable before. If the current trio of companies can prove their technology works, they will make big money from the hundreds of thousands of tons of lithium in the region.

“The fully developed Salton Sea field could serve far more than 600,000 tons per yearwhen world production is less than 400 [thousand] now, said CTR CEO Rod Colwell.

Unlike Berkshire Hathaway and EnergySource, CTR does not have geothermal power plants in the area, so it is building a joint geothermal and lithium recovery facility at the same time. Currently, the company is building a demonstration plant and plans to open its first full-scale facility by early 2024, supplying GM with 20,000 tons of lithium.

Colwell estimates that the first CTR plant will cost just under $1 billion, a higher price per ton of lithium than many traditional lithium recovery projects. But the three companies expect that price to drop as the technology develops.

CTR uses ion exchange technology to recover lithium, which it developed in partnership with Bay Area Lilac Solutions. In this method, geothermal brine flows through tanks filled with ceramic balls, which absorb lithium from the brine. When the beads are saturated, the lithium is removed with hydrochloric acid and lithium chloride remains. It is an intermediate product that CTR plans to refine on site, yielding lithium carbonate or lithium hydroxide, a powder ready to be processed and transformed into chemical precursors, then transformed into battery cells.

Berkshire Hathaway also uses ion-exchange technology, although the company hasn’t revealed as many details as CTR about how it works.

EnergySource has developed a technology known as Integrated lithium adsorption desorptionor ILiAD, and it’s jumping straight into building a full-scale facility, which is expected to be operational by 2024.

“What we see in terms of production costs is that geothermal brine should be around the first quartile in terms of market competitiveness,” said Derek Benson, CEO of EnergySource.

Notably, the three companies plan to refine lithium locally, a process that normally takes place overseas. But companies aren’t equipped to handle additional steps, such as chemical processing and battery cell manufacturing, which still take place mostly in Asia.

“The rest of the supply chain, hopefully in the coming years, will also be developed in the United States,” Knapp said, “so we can go directly from lithium and other minerals in the ground to batteries that we use to run our infrastructure.

EV battery manufacturer Italvolt recently announced its intention to launch a new company, Statevolt, with plans to build a $4 billion Gigafactory in the Imperial Valley that would produce enough lithium-ion batteries for 650,000 electric vehicles a year. Statevolt signed a letter of intent to source lithium and geothermal energy from CTR, but did not respond to CNBC’s request to know if it would perform chemical processing on site.

The new industry could have a major impact on the Imperial Valley community, where many low-income residents work in agriculture, and the the unemployment rate is 12%more than three times the national average.

California formed the Lithium Valley Commission so that government, industry, and community stakeholders could come together and analyze the potential opportunities that lithium recovery could bring.

Luis Olmedo is a member of the commission, representing disadvantaged and low-income communities in the Salton Sea geothermal resource area.

“It’s going to be really important that the community is involved and engaged, because if the community isn’t there, the vision is going to be mapped out for them,” Olmedo said. “We know these are prime target areas where communities will be leveraged. We know that.”

Berkshire Hathaway and CTR also have representatives on the Lithium Valley Commission and point to the positive impacts they believe the booming industry will bring, property tax revenue that could benefit local schools and fund additional government services. , job creation.

“This community needs us,” Knapp said. “And it’s a fantastic place for us to invest and benefit not just ourselves as a company, but all of us in the market, because lithium is so essential to our daily lives. And these people right here in this community by providing jobs, education, opportunity, all the economic development that comes with such a significant investment.

Knapp says they are working with a number of area educational institutions, from high schools to community colleges to four-year institutions, to ensure that students interested in securing employment in the industries of geothermal and lithium are properly formed.

“You know, we’re about 90% trades, right? So we’re not looking for a group of doctors here,” Colwell said.

Olmedo and Nava-Froelich say they’re encouraged by the conversations that are taking place, but they’ve been let down by big talk before.

“We’re a bit cautious because we don’t want to raise our hopes,” Nava-Froelich said, “All these talks, is this really happening or are they just talking about it and they can retire and go somewhere else? It’s almost too good to be true.”

Conservationists also see this as a moment to catalyze momentum around habitat restoration in the Salton Sea. While California has been working on the issue for years, advocates are pushing the state to accelerate projects which involve the creation of low salinity ponds on the dry lake bed where fish and bird species can thrive. And with the state budget surplus, things are finally moving.

“They need a longer term vision and a pipeline for additional projects in the future. So there’s still a lot to do, but we’re starting to see things happen,” said Michael Cohen, senior research associate at the Pacific Institute, a research institute focused on water conservation. “So we’re seeing more progress than we’ve ever seen, really.”

As mining projects face community concerns and backlash in other parts of the country, it appears that the recovery of lithium from the Salton Sea could to be the rare minerals project that unites the most players. That is, if it works.

Watch the video to learn more about lithium mining in the Salton Sea and to see plants operated and built by BHE Renewables, EnergySource and Controlled Thermal Resources.