It can be helpful for investors to understand the different deposit types at play when companies are mining lithium. There are three types of deposits that lithium is mined from: brines, pegmatites and sedimentary rocks. Different deposit types will come with different project requirements, extraction methods and processing times.
Brine deposits for example, make up 66 percent of the world’s lithium resource but may require longer processing periods since they require liquid to evaporate to access concentrated lithium.
While brines hold most of the world’s lithium, pegmatites and sedimentary lithium deposits are also important to know about. Case in point: Australia was the world’s largest lithium producer in 2016 in terms of mined production, and most of the lithium it produced came from the Greenbushes hard-rock lithium mine.
With that in mind, here’s a look at pegmatite lithium deposits and sedimentary lithium deposits.
Pegmatite deposits or “hard-rock” deposits
Pegmatite is coarse-grained intrusive igneous rock formed from crystallized magma below the Earth’s crust. It can contain extractable amounts of a number of elements, including lithium, tin, tantalum and niobium. This form of deposit accounts for 26 percent of known global lithium resources. Hard-rock ore containing lithium is extracted through open-pit or underground mines using conventional mining techniques. The ore is then processed and concentrated using a variety of methods prior to direct use or further processing into lithium compounds.
The process for extracting lithium from pegmatite or hard-rock ore is expensive, meaning that such deposits are arguably at a disadvantage compared to brine deposits; however, lithium concentration in pegmatites is considerably higher than in brines, so deposits with extremely high lithium values may still be economically viable. The production of other resources, such as tin and tantalum, can help offset processing costs.
Furthermore, hard-rock deposits are not subject to the sometimes 18-month long processing times currently seen by some brine deposits as a result of evaporation processing methods.
Lithium in pegmatites is most commonly found in the mineral spodumene, but also may be present in petalite, lepidolite, amblygonite and eucryptite.
Alaska, Northern Ontario, Quebec, Ireland, Finland and Congo are known to host pegmatite deposits. The largest producing spodumene pegmatite operation — located in Greenbushes, Australia, mentioned above — has an estimated resource of 560,000 tonnes of lithium in ore, with an average concentration of about 1.6 percent lithium. The project is owned by Talison Lithium, which is controlled 50 percent by China’s Tianqi Lithium and 50 percent by Albemarle (NYSE:ALB).
Galaxy Resources’ (ASX:GXY) James Bay project in Quebec, Canada is a lithium pegmatite (spodumene) deposit. The project is in the feasibility stage and has a NI 43-101 resource estimate showing indicated resources of 11.75 million MT grading 1.3 percent lithium oxide and inferred resources of 10.47 million MT grading 1.2 percent lithium oxide.
Galaxy also operates the Mt Cattlin spodumene mine in Australia, an open-pit mine that rests on a flat-lying pegmatite ore body. The mine is currently at full production levels producing 56,465 dry metric tonnes of spodumene in the half-year. Production ramp-ups have followed a recent optimization phase was fully funded via a $36-million spodumene concentrate offtake agreement with two Chinese buyers.
Lithium-containing sedimentary rocks
Sedimentary rock deposits account for eight percent of known global lithium resources and are found in clay deposits and lacustrine evaporites.
In clay deposits, lithium is found in the mineral smectite. The most common type of smectite is hectorite, which is rich in both magnesium and lithium. It gets its name from a deposit containing 0.7 percent lithium found in Hector, California.
Many companies have began research and development phases for their clay deposits, but no companies currently produce lithium from them.
The most commonly-known form of lithium-containing lacustrine deposit is found in the Jadar Valley in Serbia for which the lithium- and boron-bearing element jadarite is named.
The Jadar deposit, owned by mining giant Rio Tinto (NYSE:RIO,LSE:RIO,ASX:RIO), reportedly contains an inferred resource of 125.3 million MT of jadarite-bearing rock containing 1.8 percent oxide. Rio Tinto recently signed a memorandum of understanding (MOU) with the government of Serbia to fast track the development of the deposit. The project is currently in the prefeasibility stage and will begin construction in 2020 following a final investment decision from Rio Tinto.
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This article was originally published as part of a longer piece on the Investing News Network in 2012.
Securities Disclosure: I, Sivansh Padhy, hold no direct investment interest in any company or commodity mentioned in this article.