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An Australian startup backed by mining company Rio Tinto is raising funds to develop a lithium-extraction technology that could open up new reserves of the key battery ingredient and reduce the world’s dependence on China to refine the raw material.
ElectraLith, spun off from Melbourne’s Monash University, said it has successfully produced battery-grade lithium hydroxide from a variety of raw lithium grades. Having attracted investment from Rio Tinto and the UK’s IP Group, it now plans to raise $15 million to build its first plant to further develop and commercialise the technology.
The startup is one of a handful of companies developing “direct lithium mining” technology, which could transform the industry by substantially reducing lithium mining costs and opening up previously unprofitable deposits.
In a research note last year, Goldman Sachs argued that the successful deployment of DLE could double lithium production, comparing its impact to that of shale on the oil sector.
ElectraLith also differentiates itself from its rivals by saying it can refine lithium through a process it calls DLE-R. This is achieved by using electrodialysis to filter lithium-containing brine through a membrane to create lithium chloride. A second membrane further purifies it to create lithium hydroxide, a refined product used in electric vehicle batteries.
Charlie McGill, chief executive of ElectraLith, said the ability to refine lithium into hydroxide could have significant benefits for countries such as the United States and Australia, which have adopted critical minerals policies aimed at reducing their dependence on China.
“Onshoring the refining process could have a significant impact for the United States,” he said. “We can get the brines directly to Tesla and the U.S. government without any involvement from China.”
According to Benchmark Mineral Intelligence, China currently dominates lithium refining with a 65% global market share.
Mike Molinari, managing director of IP Group in Australia, said reducing costs, increasing production and managing geopolitics have become key drivers for the critical mining sector. He said technology that can help address those issues is well positioned to succeed, especially in the lithium market, where demand is expected to outstrip supply.
“The vast majority of capacity is in China and that has become problematic,” he said. “That could reduce your dependence on governments you’re not aligned with for critical resources.”
ElectraLith’s tests have shown it can refine lithium without water or chemicals, which sets it apart from traditional evaporation methods that use huge amounts of water and other DLE processes. McGill said the proof of concept showed it can produce hydroxide from very low-grade brine from Utah.
There is still skepticism about the potential of DLE, a technology that has been in development since the 1970s but has only been used commercially in a handful of projects globally, and McGill admitted the company still has a long way to go to deliver on its promises.
But the backing of mining giant Rio Tinto has been hugely significant, he said, and major oil and gas companies and government departments have expressed interest in the new round of funding.
Travis Baroni, chief advisor to Rio Tinto’s battery minerals unit and a member of ElectraLith’s board, said the technology showed “real potential to significantly reduce the economic and environmental costs of lithium production.”
