Global lithium reserves are estimated at 14 million metric tons (MT), and lithium is mined from three types of deposits: brines, pegmatites and sedimentary rocks.
Continental brines and pegmatites (or hard-rock ore) are the main sources for commercial lithium production. According to a 2011 University of Michigan study published in the Journal of Industrial Ecology, “[t]he feasibility of recovering lithium economically from any deposit depends on the size of the deposit, its lithium content (referred to as ‘grade’ for ores and ‘concentration’ for brines), the content of other elements, and the processes that are used to remove the lithium-bearing material from the deposit and extract lithium from it.”
Lithium brine deposits have gained more and more interest as of late on the back of a veritable lithium rush in Nevada, largely driven by Tesla’s (NASDAQ:TSLA) lithium-ion battery gigafactory, which recently began production in the state. Nevada is also home to Albemarle’s (NYSE:ALB) Silver Peak lithium mine, the only producing lithium brine operation in the US.
Read on for a brief look at lithium brine deposits, or click here to read our overview of lithium pegmatite and sedimentary deposits.
An overview of lithium brine deposits
Generally, lithium extraction from brine sources has proven more economical than production from hard-rock ore. While hard-rock lithium production once dominated the market, the majority of lithium carbonate is now produced from continental brines in Latin America, primarily due to the lower cost of production. That said, Australia was still the world’s largest lithium producer in 2016 in terms of mined production, and most of that came from the Greenbushes hard-rock lithium operation.
There are three types of lithium brine deposits: continental, geothermal and oil-field. The most common are continental saline desert basins (also known as salt lakes, salt flats or salars). They are located in areas with geothermal activity and are made up of sand, minerals with brine and saline water with high concentrations of dissolved salts. A playa is a type of brine deposit whose surface is composed mostly of silts and clays; they have less salt than a salar.
Lithium brine deposits represent about 66 percent of global lithium resources and are found mainly in the salt flats of Chile, Argentina, China and Tibet.
1. Lithium brine deposits: Continental
This is the most common form of lithium-containing brines. The majority of global lithium production comes from continental lithium brine deposits in what is known as the Lithium Triangle — a region of the Andes mountains that includes parts of Argentina, Chile and Bolivia.
The best example is the 3,000-square-kilometer Salar de Atacama in Chile, which contains an average lithium concentration of about 0.14 percent — the highest known — and estimated lithium resources of 6.3 million MT.
Two of the world’s leading lithium producers, Sociedad Quimica y Minera (NYSE:SQM) and Albemarle, operate on the Salar de Atacama. FMC (NYSE:FMC) produces lithium carbonate from another world-class lithium brine deposit, Argentina’s Salar del Hombre Muerto. Orocobre (ASX:ORE) is currently ramping up production at its operations on the neighboring Salar de Olaroz.
Galaxy Resources (ASX:GXY) recently released its first lithium shipment from the Mount Cattlin hard-rock lithium mine in Australia, and it also holds the Sal de Vida project in Northwestern Argentina.
Bolivia is home to the world’s largest deposit of lithium, the Salar de Uyuni, which reportedly contains up to 50 to 70 percent of known world reserves. However, the odds of this continental brine seeing commercial production are low for several reasons.
Those include: the fact that Bolivia is keen on keeping its natural resources under state control; the deposit’s higher magnesium–to-lithium ratios, which are three times as high as those at Atacama and make it more difficult and costly to refine salt into lithium carbonate; and the fact that the evaporation rate at Uyuni is only 40 percent of that at Atacama, which means refining would be more time consuming.
2. Lithium brine deposits: Geothermal
Geothermal lithium brine deposits make up roughly 3 percent of known global lithium resources and are comprised of a hot, concentrated saline solution that has circulated through crustal rocks in areas of extremely high heat flow and become enriched with elements such as lithium, boron and potassium. Small quantities of lithium are contained in brines at Wairakei, New Zealand, Reykanes Field in Iceland and El Tatio in Chile.
The Salton Sea in Southern California is the best-known example of a geothermal lithium brine deposit. Simbol Materials, a private California-based company, had plans to produce high-purity lithium carbonate from discharge brine borrowed from geothermal plants operating on the Salton Sea. It would have used a unique reverse osmosis process to eliminate the need for solar evaporation, making operations more timely and cost effective.
For over a year and a half, Simbol validated the process at its demonstration plant in California, and said in mid-January that it had plans to begin construction of a large-scale plant. However, things came to an abrupt halt when The Desert Sun reported that Simbol had fired 38 workers from its demonstration plant at the start of February 2015. Controlled Thermal Resources recently acquired Simbol’s technology and is working on picking up where Simbol left off.
3. Lithium brine deposits: Oil field
Lithium brine deposits can also be found in some deep oil reservoirs, accounting for 3 percent of known global lithium resources. The Smackover Formation on the US Gulf Coast is believed to hold an estimated 1 million MT of lithium resources at an average concentration of about 0.015 percent. North Dakota, Wyoming, Oklahoma, Arkansas and East Texas are home to oil-field brines with concentrations as high as 700 milligrams per liter, according to geologist Keith Evans.
This is an updated version of an article originally published by the Investing News Network in 2016.
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Securities Disclosure: I, Sivansh Padhy, hold no direct investment interest in any company or commodity mentioned in this article.