Energy Analytics Energy Transition

Securing domestic supply of lithium

byGraham Bain

In last week’s issue of Energy Transition Today, we discussed the significant drop in solar capture prices in California over the past five years. This decline presents a valuable opportunity for solar projects to utilize co-located battery storage, charging them with affordable solar power during daylight hours and discharging the stored energy in the evening to capitalize on higher peak pricing. From co-located battery storage to electric vehicles, we see rising demand for battery production and battery metals like lithium, and by 2035 we anticipate lithium demand to increase by 350,000 tonnes from 2019 levels.

Currently, 95% of the global lithium supply is mined in just four countries: Australia, Chile, China and Argentina. The U.S. only contributes 1%, illustrating the need to secure local production as demand increases. Recent government policy changes offer hope, with the Defense Production Act allocating up to $1 billion per year to boost domestic mineral development and the Inflation Reduction Act introducing a 10% critical minerals tax credit on mining and refining.

However, bringing new mines online can take decades and evaporative salars have geographical limitations due to their need for extremely dry environments. This is where direct lithium extraction (DLE) comes into play. Currently being tested for commercial viability, DLE has the potential to extract lithium from large volumes of low-concentration lithium brines. If successful, DLE could unlock almost limitless domestic lithium production, either from dedicated brine resources or from the approximately 3 billion barrels of oilfield wastewater produced monthly in North America.

FIGURE 1 | Yearly Lithium Production and Revenue Potential

Source | Enverus Foundations, Alberta Geological Survey.

Figure 1 shows the potential for lithium extraction and revenue from wastewater for five operators in the Delaware Basin. With a total of 29,000 tonnes/year, generating $600 million in additional revenue at a $20,000/tonne spot price, the implications are clear. If DLE proves successful, it could not only meet domestic lithium demands but also generate significant revenue in the process.

Highlights from Energy Transition Research

A Simple Guide to Energy Transition Metals

This report presents a supply and demand outlook for metals that will be crucial in supporting the decarbonization of the energy system.

A Simple Guide to Synthetic Fuels

What will it take for synthetic fuels to play a significant role in the replacement of hydrocarbons in the transportation sector?

The Inflation Reduction Act – Impact on CCUS

This report explores the impacts of the Inflation Reduction Act on the development of CCUS projects in the United States.

Energy is changing. Connect weekly with the ideas that are leading the way.

Button - Subscribe to Energy Transition Today

About Enverus Intelligence®| Research
Enverus Intelligence Research, Inc. is a subsidiary of Enverus and publishes energy-sector research that focuses on the oil and natural gas industries and broader energy topics including publicly traded and privately held oil, gas, midstream and other energy industry companies, basin studies (including characteristics, activity, infrastructure, etc.), commodity pricing forecasts, global macroeconomics and geopolitical matters. Enverus Intelligence Research, Inc. is registered with the U.S. Securities and Exchange Commission as a foreign investment adviser. Click here to learn more.

Graham Bain

Graham Bain

Graham joined Enverus Intelligence Research (EIR) in 2020 with the acquisition of RS Energy Group. As lead of the subsurface group on the Energy Transition Intelligence team, Graham creates intelligent connections between the subsurface, emerging energy and carbon innovation technologies through a deep understanding of geosciences and the energy transition. Prior to EIR, Graham worked as an analyst for the Alberta Energy Regulator with a focus on the Athabasca oil sands, and as a geologist in training for a Calgary-based exploration company.

Subscribe to the Enverus Blog

A weekly update on the latest “no-fluff” insight and analysis of the energy industry.

Related Content

Intelligence Publications
ByErin Faulkner

Operators in Oklahoma’s SCOOP and STACK plays have been improving their economics with “super pads,” which contain wells completed with more than 3,100 lb/ft of proppant, according to Enverus Intelligence® | Research (EIR). The resulting uptick in productivity can shave...

Energy Analytics Energy Transition
ByKevin Runciman

In recent years, the oil and gas industry has witnessed a remarkable shift in focus towards environmental performance, driven by the growing importance of environmental, social and governance (ESG) considerations. Among the various environmental concerns, reducing flaring has emerged as...

Energy Analytics Energy Transition
ByAndrew Gillick

In case you missed it, Enverus virtually hosted EVOLVE, our flagship conference, May 16-17. The event included two full days of presentations, panels and keynotes, distilling the most relevant data and thoughts on the industry today.  Below Andrew Gillick, managing director...

Energy Analytics Other
ByShane Reddell

In the current landscape of heightened environmental and social consciousness, upstream oil and gas companies face significant challenges in achieving favorable refinancing for their existing credit facilities. These challenges are compounded by the recent volatility in the debt markets and...

Energy Analytics Intelligence Publications
ByMaurice Smith

Wildfires that have already scorched more than double the average annual fire destruction across Alberta forced the shut-in of more than 300,000 boe/d while threatening future shuttering of output from the so-far largely unaffected oil sands region. Record temperatures saw...

Energy Analytics Energy Transition
ByHeather Leahey

CO2 containment risk has become one of the most popular topics among our clients evaluating CCUS projects. Operators need to understand and evaluate subsurface features that could trigger CO2 migration and containment losses as well as introduce additional safety, reputational...

Energy Analytics Energy Transition
ByRyan Luther

Anyone who thinks spending time at a public charging station is a blocker to buying an electric vehicle (EV) might want to consider the numbers behind EV and internal combustion engine (ICE) vehicle refueling times. The answer is that it...

Enverus Blog - 6 tax preparation tips for mineral and royalty managers
Energy Analytics
BySilas Martin

Recent years have been a roller coaster for mineral buyers, from record low commodity prices to highs for oil and natural gas in the last year. Going forward, challenges and opportunities will be plentiful. We expect oil prices between $80...

Power and Renewables
ByKenneth Curtis

It’s that time of year when generator and transmission outages are at their peak in PJM. The first half of April has not disappointed volatility-wise as the WHUB/NIHUB spread has set new 30-day highs largely driven by congestion. Figure 1:...

Let’s get started!

We’ll follow up right away to show you a quick product tour.

Let’s get started!

We’ll follow up right away to show you a quick product tour.

Sign up for our Blog

Access Product Tour

Speak to an Expert