Now, as EVs become part of the mainstream - and with talk of massive energy storage solutions and advancing consumer electronics, there seems to be no end to demand for lithium in site - the brine is the new battlefield.
New Tech Could Be A Game Changer For The Lithium Sector
Ian Jenkins | OilPrice.com
A new company-with a breakthrough technology-has the potential to reshape lithium production in the same way fracking reshaped oil production. Included in today's commentary: Pretium Resources (NYSE: PVG), Magna International (NYSE: MGA), Endeavor Silver (NYSE: EXK), Teck Resources (NYSE: TECK) , Cameco Corporation (NYSE: CCJ).
In fact, as reported by USA Today, International Battery Metals' (IBAT: RHHNF) incoming Chief Executive Officer (CEO), John Burba, was offered $325 million by Elon Musk for Burba's previous company and its second-generation technology. A major New York investment banking firm, however, valued that company and the second-generation technology at $2.5 billion, seven times what was being offered. A deal was never completed.
Since then, Burba and a hand-selected team of experts have agreed to move over to IBAT, bringing with them their newly invented third-generation technology specifically directed at oil field brines.
This could be a significant opportunity for early investors.
The global battery market is set to hit $120 billion in less than two years, and there's a massive investor opportunity here in lithium-but this isn't a mining play, it's a tech play all the way.
As lithium continues to enjoy the status of one of the hottest metals on the market, and as producers race to the finish line to bring new supply online, IBAT stands out-front and center-because it will soon be sitting on a proprietary advanced technology that could push lithium extraction into the production stage rapidly. It has signed an agreement with NAL and SAL to acquire the proprietary advanced (third-generation) intellectual property and technology for oil field lithium extraction processes.
Where traditional solar evaporation technology takes up to 24 months to extract lithium from the brine, the technology to be acquired by IBAT can do it in 24 hours, according to Burba. That would put IBAT at the forefront of new lithium supplies coming online to meet the demand for energy transition for everything from mainstreamed electric vehicles (EVs) to massive energy storage solutions and a consumer electronics market that is growing by leaps and bounds.
The lithium game isn't about exploration, it's about innovation-and this proprietary third-generation technology was co-invented by the same game-changing inventor-Burba- that came up with a similar tech for FMC Corp., one of the world's four top lithium producers.
#1 Time is Money
The technology IBAT is acquiring-and may consider partnering with third-party lithium producers-could be a significant key to unlocking $84 billion in lithium brine resources by producing lithium faster and more cheaply.
The ambitious targets for electric vehicle (EV) deployment and energy-storage applications require massive lithium mining capacity to be built faster than current technologies allow.
That's the chief reason why companies are aggressively pursuing new resources such as jadarite and hectorite clay, and more importantly, oil field brines. Lithium brine deposits are estimated to contain 66 percent of the world's 14 million metric tonnes (MT) of Lithium. That's $84 billion worth of lithium at current prices.
Unfortunately, the recovery of lithium from brine deposits is a painfully slow process. Traditional solar evaporation technology is an extremely time-intensive process, with production cycles that can take up to 24 months.
Instead of going the traditional route of trying to isolate lithium by removing all of those complex ions, the IBAT technology removes the lithium directly.
According to Burba, the process takes the lithium out of the brine on a continuous basis. As the brine passes through the system, the lithium is collected while impurities flow right through and go straight back into the ground. The end-product is a diluted stream of lithium chloride and water that comes out as the brine goes by. That solution, which has a smaller volume and far fewer impurities than the original brine, is far easier to process.
The new technology Burba and his team will be implementing for IBAT creates a lithium extraction process that reduces an 18-24 month process to just one day., according to Burba
This paradigm-shifting technology could be highly disruptive, offering the fastest-to-production lithium brine extraction solution available anywhere. Faster means more efficient and more cost effective.
#2 Inventor/CEO + Technical and Commercial Dream Team
Inventor John Burba-a veteran in lithium extraction-is the incoming IBAT (IBAT: RHHNF) Chairman and CEO, and he's one of the most important pioneers in lithium extraction technologies. He is considered a genius in this space.
IBAT's to-be-acquired technology is based on a tech that Burba co-invented and sold in the 1990s when he was a leading technology figure at giant FMC.
Before Burba came along, everyone thought that lithium could be produced from only a limited number of brines.
That's where Burba's genius came into play. FMC has been using Burba's "old" first-generation methods for nearly 20 years, and FMC is responsible for making the purest primary lithium carbonate in the world. It's even earned its own lithium label: "FMC-grade" lithium carbonate.
This inventor/CEO has already revolutionized lithium processing once. Now he's bringing other lithium industry veterans with him, and they are determined to do it again, this time leading a company that promises to pack a professional punch.
#3 IBAT Hits the Brine, Running
Entering the lithium business just this year, IBAT (IBAT: RHHNF) has hit the ground running and has reason to be confident in the commercial viability of its advanced technology. Who wouldn't be with the genius in this space who helped design FMC's super-efficient lithium extraction process and his hand-picked designers and professionals?
Oil field brines are a potentially staggering resource. Lithium has been found extensively in North American oil field brines, and Burba and his team have evaluated hundreds of these fields. Lithium is best produced from the right brine, so, this way, once IBAT finds the best brine out there, they will be ready to strike. Again, this could like a potential shale revolution - but for lithium.
IBAT anticipates that by 2020 it will become a supplier of various battery metals. And by then, well, demand should be out of this world.
#4 Supply and Demand
The global lithium-ion (Li-ion) market is expected to exceed $46 billion by 2022, growing at nearly 11 percent CAGR. What the world needs right now is a plentiful supply of high-grade lithium to power the unfolding EV revolution.
There's more upside risk here because of the incredible battery demand, according to Bloomberg New Energy Finance's Andrew Grant.
A Tesla 70kWh Model S battery pack contains 63 kg of lithium, equivalent to the amount of lithium in 10,000 cellphones. Tesla will use up the entire world's current supply of battery-grade lithium when it hits a production clip of 500,000 Model 3s in its giant Nevada gigafactory sometime in 2018. When Tesla opens up its four more planned gigafactories, there just will not be enough lithium to go around.
The Bottom Line? This is Burba's Brine
Technology has significantly improved in the past thirty years. Burba and his team have vastly improved their technology too - and Burba's first-generation technology already completely powers lithium production for FMC. The second-generation technology was also valued at at least $325 million.
With the same inventor and his hand-selected brain trust of lithium experts behind the third-generation of this technology soon to be all working together at the helm of IBAT, confidence runs high.
Before the explosive entrance of the lithium-ion battery, getting lithium from other sources like oil field brine wasn't so urgent. Now, as EVs become part of the mainstream - and with talk of massive energy storage solutions and advancing consumer electronics, there seems to be no end to demand for lithium in site - the brine is the new battlefield. IBAT (IBAT: RHHNF) should be soon poised to deliver the most decisive weapon.
Other companies to watch:
Pretium Resources (NYSE: PVG) This impressive Canadian company is engaged in the acquisition, exploration and development of precious metal resource properties in the Americas. Additionally, construction and engineering activities at its top location continue to advance, and commercial production is targeted for this year.
Magna International (NYSE: MGA) is based in Aurora, Ontario. The global automotive supplier is gutsy and innovative--and definitely tuned to the obvious future--clean transportation. A great catalyst is its development of a combo electric/hydrogen vehicle--a fuel cell range-extended EV (FCREEV).
Endeavor Silver (NYSE: EXK) operates three silver-gold mines in Mexico, but it also has three attractive development projects. Production has dropped and all-in sustaining costs have risen, leading to a negative cash flow. But the company has significantly reduced its debt, so its future is anything but bleak.
Teck Resources (NYSE: TECK) Zinc hasn't been Teck's best friend of late, but that looks set to change in the medium term, as supply continue to dwindle and as we hear news that the world's top producer of the metal-Glencore-isn't planning to bring shuttered mines back online. Supply will remain tight.
Cameco Corporation (NYSE: CCJ) Cameco is one of the largest global producers and sellers of uranium and nuclear fuel. Its operating uranium properties include the McArthur River/Key Lake, Cigar Lake, and Rabbit Lake properties located in Saskatchewan, Canada; the Inkai property situated in Kazakhstan
The content & opinions in this article are the author’s and do not necessarily represent the views of AltEnergyMag
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