World’s Largest Lithium Reserve Found Beneath Salton Sea

World’s Largest Lithium Reserve Found Beneath Salton Sea

The U.S. Department of Energy has announced its second significant lithium discovery this year, positioning the country for long-term self-sufficiency in the crucial battery metal. The latest find is a vast lithium deposit beneath California’s Salton Sea, estimated to contain around 18 million tons of lithium.

The Department of Energy (DoE) projects that, with anticipated technological advancements, the total lithium resources in the Salton Sea region could yield over 3,400 kilotons of lithium, valued at up to $540 billion. This quantity would be sufficient to power more than 375 million electric vehicle (EV) batteries, surpassing the current number of vehicles on U.S. roads.

Jeff Marootian, Principal Deputy Assistant Secretary for Energy Efficiency and Renewable Energy, emphasized the significance of lithium in decarbonizing the economy and achieving President Biden’s target of 50% electric vehicle adoption by 2030.

The DoE underscored the report’s confirmation of a unique opportunity to establish a domestic lithium industry, fostering clean energy generation and bolstering national energy security. The department emphasized the use of American innovation to lead the clean energy future and create jobs.

Acknowledging current limitations in the U.S. lithium supply chain, the DoE highlighted the country’s reliance on imports, mainly from Chile and Argentina, for nearly half of its lithium consumption. The Salton Sea lithium deposit offers a strategic advantage, with high concentrations of lithium resulting from subsurface geology and geothermal activity.

The prospect of direct lithium extraction (DLE) technologies adds another layer to the positive outlook. DLE aims to achieve approximately 90% lithium extraction from brine water, a substantial improvement over the 50% extraction rates of conventional methods. These technologies, capable of extracting lithium in a matter of days, also present environmental benefits by being portable, recycling fresh water, and limiting the use of hydrochloric acid.

While advancements in direct lithium extraction are promising for the electric vehicle sector, some observers caution that such developments might not be welcomed by traditional lithium enthusiasts. Elon Musk, CEO of Tesla Inc., acknowledges lithium’s abundance but points to slow and inefficient mining techniques as a current hindrance to its supply.

The introduction of commercial-scale DLE projects is anticipated as early as 2025, potentially contributing to 13% of global lithium demand by 2030, according to Fastmarkets. This advancement could generate over $10 billion in annual revenue for the DLE industry within the next decade.

Despite optimistic projections, concerns have been raised about the impact of DLE on the lithium market dynamics. Goldman Sachs forecasts a brisk 33% annual growth in lithium carbonate supply, outpacing the expected 25% annual growth in demand. This scenario could potentially lead to a prolonged period of subdued lithium carbonate prices, according to Morgan Stanley’s analysis.