Can Alberta’s petrobrines help meet the ‘huge demand’ for lithium?

Calgary-based E3 Lithium (TSXV: ETL; US-OTC: EEMMF) recently announced the successful manufacture of a small batch of sorbent, a critical chemical component of its plan to produce battery-grade lithium products at its Clearwater project from brines in the historic Leduc Formation in Alberta.

The company, which has developed direct lithium extraction technology as capable of generating more than 90% recovery from brines while increasing lithium concentration and reducing impurities by more than 99%, is aiming to be the first to produce lithium in the province.

Other lithium explorers are also working on proprietary extraction technologies. Chris Doornbos, president and CEO of E3 said the company’s extraction technology is an ion exchange process that uses a proprietary sorbent. Sorbents are substances that collect molecules from another substances. E3’s chemical processes are similar to water softeners, he said. 

“Ion exchange itself is not complicated,” said Doornbos, a geologist. “It’s used all over the world for all sorts of applications. We are trying to get a metal out of a liquid. So that’s what it is. The medium we developed has been demonstrated to have high selectivity for lithium, which means we can generate a highly pure lithium concentrate.” 

In July, E3 completed drilling its first well into the Leduc Formation to verify lithium concentrations, flow rates and other reservoir characteristics of its Clearwater project, located east of Olds, Alta. The well is 2,670 metres deep — 36.9 metres of core were retrieved. The Leduc, a major source of oil and gas in Alberta, is of late Devonian age. The Leduc No. 1 well, completed in 1947 by Imperial Oil, produced over 300,000 barrels of oil, launching Alberta’s post-Second World War oil boom.  

“The progress we’ve made on our evaluation program is the result of significant effort from our geosciences team and the importance Alberta has placed on exploring and producing critical minerals,” Doornbos said. “Drilling a second well will help increase geologic confidence in the Clearwater project area and allow E3 to continue to advance its project towards prefeasibility, supporting the energy transition in Alberta.” 

In June, E3 announced a collaboration with Imperial to advance a lithium brine pilot project in the Leduc. The company hopes for commercial production in 2026. The agreement included a $6.4-million investment into E3, with Imperial offering technical and development support in areas such as water and reservoir management and access to freehold lands in the area managed by Imperial.  

E3 has outlined resources in its permit area in south-central Alberta totalling 24.3 million inferred tonnes of lithium carbonate equivalent (LCE). 

The Bashaw project (which combines the former Clearwater and Exshaw West projects), hosts the majority of the resource, with 59 sq. km of brine formation averaging 74.5 mg/l of lithium for 23.4 million tonnes of LCE. A 2020 preliminary economic assessment of Clearwater alone (with a resource of 2.2 million tonnes of LCE at a grade of 74.6 mg/l) estimated it could produce about 20,000 tonnes of lithium hydroxide per year over 20 years. The initial capital cost was pegged at US$602 million, and at an 8% discount rate, the project’s after-tax net present value was estimated at US$820 million, with a 27% internal rate of return. 

Looking west over E3 Lithium’s lithium project area in south-central Alberta. Credit: E3 Lithium

‘Huge demand’ 

Despite breakthroughs and optimism, Canada’s nascent brine sector faces an uphill battle. It could take years for the company, and others in the lithium sector to achieve commercial production that rivals oil and gas in output, say insiders. 

“I don’t know when lithium will be produced commercially in Alberta,” said Salman Safari, a chemical engineer and an expert on lithium extraction technology. “I hope that very soon we will see a pilot plant here.” 

He added: “I think the main barrier could be the economics of the process, especially for petrobrines that are very challenging to deal with because you need to treat them and clean them up. And the cost of producing and cleaning brines can be high and can outweigh the value of the lithium that you’re going to extract, compared to shallow — cleaner — lithium brines in South America.” 

Geologist Dan Alessi, a petrobrine expert, says a profitable lithium facility in Alberta is still five years away. And while he says it will take decades for Canada’s lithium sector to reach the magnitude of oil and gas, the workforce is already there. 

“If you’re talking about redeploying oil and gas workers, there’s a lot of transferable skills,” he said. 

Alessi and Safari launched lithium company Recion Technologies in 2019. Recion is developing its own extraction technology with the aim of building a pilot project that could be commercialized in partnership with Australia’s Morella Corporation. 

“There’s huge demand for lithium,” Alessi said. “There are predictions we’ll need three to four times the lithium we use now by the end of the decade. There’s a huge supply gap that must be filled by alternative resources.” 

With 11 years of research and development under its belt, Calgary-based Conductive Energy is determined to help meet the demand for battery grade lithium products using its own top-secret formula and process. The company says its proprietary materials can recover at least 95% of brine lithium at 99.5% purity. 

Conductive is working with Berkshire Hathaway Energy Renewables at their geothermal facility in Southern California’s Salton Sea. The demonstration project would see a co-production of lithium from brine alongside renewable geothermal energy, a process that could enhance site economics. 

The Salton Sea is shallow, contaminated, landlocked, and extremely saline. A California Energy Commission report says it could produce more than 600,000 tonnes of lithium carbonate per year. 

“We are probably one of the most advanced direct lithium extraction companies in the world,” said Conductive CEO Haafiz Hasham, adding the company also has multiple projects in Alberta. “When you look at things on the world stage, the Salton Sea project starts to shine.” 

The advantages of being the potential technology provider at the Southern California site are many, Hasham said. Because it’s an existing geothermal facility, brines are already being delivered to surface, so there’s no need for expensive drilling programs. Also, the resource is proven and relatively large. 

“On a brownfield basis, if successfully scaled, it’s capable of producing about 90,000 (short) tons of lithium carbonate equivalent a year,” he said, adding the company doesn’t own the resource. “And what makes this one of the most exciting projects is we’re one of the only direct lithium extraction companies in the world to have partnered with a brownfield resource. All our other competitors are generally working with greenfield resources.”