Western USA Lithium Production and Development

May 07, 2024


Image by  simonkr at iStock

For decades, lithium producers have extracted this white-gold mineral by pumping the water to the surface, creating brines, and letting it evaporate until the lithium becomes concentrated enough to filter. This form of lithium extraction has been the only method used in the US, a country that relies almost entirely on lithium imports, with a small fraction of supply sourced domestically from a brine operation in Nevada (the Silver Peak mine).

According to the USGS, the US has predominantly imports lithium from Argentina and Chile, accounting for 51% and 40%, respectively. Moreover, the US depends on lithium-ion batteries from China. In an article published by the World Economic Forum, the data from the UN Comtrade Database shows that in 2022, the US imported US$13.9 billion of lithium-ion batteries, and China accounted for US$9.30 billion of this. However, as global economic superpowers vie for supremacy in securing their critical mineral supply chain, the US has taken strategic measures to revert these figures. Initiatives such as the Inflation Reduction Act, the Infrastructure Investment and Jobs Act and the Bipartisan Infrastructure Law have been enacted to propel lithium-focused projects forward to achieve electrification goals and reduce dependence on foreign sources. In this context, all eyes are turned to Nevada, the Mecca of lithium production and exploration in the Western US.

Silver Peak, operated by Albemarle, has continuously operated since 1965, producing technical-grade lithium carbonate. Located in Nevada's Esmeralda County, the mine has consistently yielded an annual average of 3,500 to 4,000 t/y of lithium carbonate. In resonance with Washington's objectives to enhance and fortify the domestic supply chain, Albemarle has been actively pursuing an expansion strategy to boost its production to approximately 7,500 t/y by 2025. "We have completed several projects to help us reach that goal, one of those being the expansion of our brine production well field where, over the past two years, we have drilled another 22 production wells and now have the pumping capacity to produce 20,000 acre-feet of brine, equivalent to roughly 7,000 t of lithium carbonate equivalents (LCEs). Due to the time it takes for the brine to come through the system and reach the plant, this increased lithium production will not be realized until roughly 2025." commented Scott Thibodeaux, Silver Peaks' operations manager.

Silver Peaks concentrates the lithium for 18 to 24 months through evaporation. While effective, this natural method renders lithium extraction a time-consuming process that hinders the urgency of obtaining lithium faster. The DOE is thus strategically investing in new lithium extraction technologies from other deposits, like geothermal brine sources or claystone. Besides brines and spodumene (hard rock mineral ore, prominent in Australia), lithium can be found in lithium-bearing clays, abundant in Nevada, like in the McDermitt Caldera. A recent study published in Science Advances by a group of US geologists suggests that an ancient supervolcano on the Nevada-Orgeon border may contain claystone containing between 20 to 40 million t of lithium. To put this into perspective, the Salar de Uyuni salt flat on the Bolivian side of the "lithium triangle" is estimated to host around 21 million t of lithium.

Within the southern end of the Mcdermitt Caldera, Lithium Americas operates the Thacker Pass project, which currently holds a measured and indicated estimate of approximately 19 million t of lithium carbonate equivalent, and its plan to release another resource update by the end of 2023. "The updated resource estimates expected for this year will likely be in the mid to upper 20 million t range in terms of LCE. This would position Thacker Pass as one of the largest reported LCE resources in the world," stated John Evans, president and CEO of the company.

Despite encountering challenges from environmental groups, the construction of Thacker Pass began in early 2023. The project is anticipated to require an estimated capital expenditure of US$2.3 billion, with mechanical completion projected for late 2026 and a ramp-up scheduled for 2027. According to the project's website, it aims to achieve an annual production capacity of up to 40,000 t/y of lithium carbonate.

Even though it falls under the category of a mining project, the extraction of lithium from clay deposits is more accurately described as a chemical process. When discussing the mineralogy of Thacker Pass, Evans highlighted the benefits of sedimentary lithium clay deposits from an environmental point of view, with the potential for global application as lithium demand grows: "These deposits are cost-effective, requiring lower initial investment and avoiding energy-intensive steps like calcining, crushing/flotation and solvent extraction, thus reducing the carbon footprint," he stated.

Evans revealed that Lithium Americas is in advanced discussion with the US government to secure a loan from the Department of Energy under the Advanced Technology Vehicles Manufacturing Loan Program (ATVM Loan Program).

A company that has already successfully secured the ATVM fund is Ioneer, the owner of the Rhyolite Ridge lithium-boron project located in Esmeralda County. Currently in the final stages of permitting, Ioneer anticipates receiving the Record of Decision by the first half of 2024, with construction scheduled to commence around the same period, and the project is set to reach its first lithium production in the second half of 2026.

Many questions arise when considering the intricacies of permitting and government funds, particularly within the US' commitment to securing its lithium supply. Bernard Rowe, the managing director of Ioneer, emphasized the importance of addressing the misconceptions surrounding the DOE and the ATVM funding program: "Contrary to belief, it does not specifically fund mining activities; it focuses on chemical processing plants. The funding is earmarked for the chemical processing plant at Rhyolite Ridge, a critical distinction given that most of our project's capital investment is allocated to this phase."

In April 2023, Ioneer increased the mineral resources by 168% for the South Basin, which now ups to 3.4 million t of lithium carbonate equivalent. Rowe explained that the deposit's mineralogy of Rhyolite Ridge resembles a "pancake," with the uppermost layer containing lithium and clay, followed by the layer with lithium and boron, and the deepest layer with lithium only, all falling under the same permitting area expected by 2024.

Ioneer's current processing plant is tailored for high lithium and high boron, which are incompatible with clay-rich material. Thus, it expanded its partnership with EcoPro, a Korean-global leader in battery grade high purity lithium hydroxide conversion. This Research and Development Memorandum of Understanding will be dedicated to developing clay resources with novel chemical technologies: "By partnering with EcoPro Innovation (EcoPro), a Korean company specializing in cathode manufacturing and chemical processing technologies that is also an offtake partner for lithium carbonate produced from our lithium and boron layer, we are developing a production process for our specific, high-carbonate lithium and clay material," explained Rowe.

Also capitalizing on the abundance of claystone in central Nevada is the American Battery Technology Company (ABTC). Its unique approach with two vertically integrated business units sets this company apart. On the one hand, ABTC focuses on recycling lithium-ion batteries; on the other, it is engaged in the Tonopah Flats lithium project. This integrated strategy allows leveraging synergies between the two business units. "Our personnel bring the same skills to both business units. We utilize many of the same laboratory facilities and unit operations across both units. Additionally, we produce products to the same specifications in both business units, allowing us to sell similar products to the same customers. The synergies between our business units are indeed significant," declared Ryan Melsert, president and CEO.

ABTC has developed a technology named "selective lithium leaching" that recovers lithium from solid material, leaving non-lithium components stable, eliminating the need for Direct Lithium Extraction that, according to Melsert, often faces challenges when scaling up. This could be a game-changer since, compared to conventional processes, ABTC's technology reduces environmental impact, the need for extensive infrastructure, and the use of chemical agents.

Direct Lithium Extraction (DLE)

In Southeast Utah and Western Colorado, the Paradox Basin has traditionally been renowned for its conventional oil and gas production. With exploration efforts dating back to the 1950s and a historical focus on oil and gas, Utah now hosts one of the most technologically advanced lithium projects in the Western US — the Paradox Lithium project. Named after the basin, this project is operated by the Australian-based company Anson Resources. The discovery of the Paradox Lithium project occurred during oil drilling in the 1960s at a depth of approximately 6,500 feet (around 1.98 km) with a pressure of 4,500 psi. Bruce Richardson, the CEO of Anson Resources, highlighted that this pressure level is significantly higher than typical standards, providing a distinct advantage for the project. "This natural pressure enables the brine to reach the surface without requiring pumps," he said.

In addition to acquiring the Green River Lithium project, located approximately 80 km from Paradox and thereby strengthening its footprint in Utah, Anson Resources has undertaken, in 2022, a Definitive Feasibility Study in collaboration with Worley and SunResin. The DFS, with an estimated cost of around US$500 million, primarily centered on a chemical plant process, aligning with the approaches taken by operators like Ioneer and Lithium Americas. "Anson initially designed the plant for 10,000 t/y, based on a JORC resource of around 1 million t at 140 ppm. However, during the DFS, both tonnage and grade increased to about 13,000 t/y with an average grade of 180 ppm," shared Richardson.

But what is DLE? In contrast to conventional lithium production methods, Direct Lithium Extraction (DLE) employs filters, membranes, or resin materials to extract the so-called white-gold from brine water. It seems that this technology could be such a game-changer: Goldman Sachs suggests that DLE could do for lithium mining what the shale technologies did for oil. Anson Resources intends to apply DLE following thorough testing and finally opting for a resin-based approach. With this method, lithium in the brine is drawn to the resin, which is subsequently washed to extract the lithium suspended in water. Later it purifies the extracted lithium and eliminates trace elements such as calcium, iron, and magnesium. "Our DLE method is environmentally friendly as it avoids chemical use and contains the process. After lithium extraction, the waste brine is reinjected into the porous rock at about 2,000 feet underground. Unlike evaporation ponds, which take longer to produce a concentrate suitable for purification, DLE allows us to go from brine to the final product in just 24 hours," stated Richardson.

The 24-hour timeframe represents a significant reduction compared to the 18 to 24 months required for lithium extraction in the Silver Peak brines. Anson Resources has adopted this advanced technology through a partnership with Sunresin, a Chinese Direct Lithium Extraction (DLE) provider with a successful track record spanning over five years. The next stage for Anson Resources involves the front-end engineering design, slated for completion in Q1 2024. This phase aims to refine cost estimates further and advance the project.

ACME Lithium is another company exploring the possible use of DLE due to its superior recovery rates. While still in the exploration stage, the company owns the Clayton Valley project, a lithium brine project located in the southwestern region of Nevada, adjacent to Albemarle's Silver Peak operation. Stephen Hanson, president and CEO of ACME, emphasized: "Traditionally, lithium has been extracted from brine by using large evaporation ponds. This process can be time-consuming, and the recovery rates can vary and be as low as 50% in some cases. Conversely, DLE is a promising technology where lithium is extracted within a few days with improved recovery rates."

ACME is in discussions with several DLE companies and believes this emerging technology will revolutionize the industry for several reasons, including improved economics, and most importantly, addressing some ESG issues.

According to Goldman & Sachs, besides doubling lithium recoveries up to 70-90%, DLE reduces land usage, with the decline of pond requirements by more than 20 times, as well as improvements in water usage.


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