Managing the global energy transition

John L Burba, Founder and Chairman of International Battery Metals, discusses lithium’s role in the global energy transition and explains how the company is working to strengthen the global lithium supply.

Several years ago, the world hit a global energy tipping point. The move toward global electrification is virtually a given. However, all ‘sharp turns’ have unexpected consequences. In the case of green energy, the primary issues are not with the ability to build electric vehicles (EVs), windmills, or solar farms. Our global issue is the critical materials supply chain.

Global demand

Due to the impressive demand for all things electric, there is corresponding growing demand for necessary critical materials. Fortunately, global statistics indicate that the demand will be manageable for materials such as cobalt and nickel due to their broad and reasonably diverse production bases. Rare earth elements (REE), particularly praseodymium, neodymium, dysprosium, and terbium, will probably meet demand. These elements are primarily produced in the Baotou, Inner Mongolia, China and from ionic clay beds in China and Myanmar. Ionic clay formations have also been found in Australia, South Africa, and Chile. This is important because it lessens global dependence on China.1 Thus, most critical metal production is expected to meet demand for the foreseeable future.

However, this is not the case with lithium. Global production of lithium, on a lithium carbonate equivalent (LCE)2 basis, in 2022 is estimated to be about 636,000 MT. This is up from 497,000 MT in 2021. Demand in 2030 is expected to increase to between 2,500,000 MT to 3,000,000 MT for all lithium battery demand. An additional 200,000 MT to 300,000 MT will be necessary for conventional, non-battery, applications.3 Suffice to say that the likelihood that global lithium supply will balance demand by 2030 is very low.

This lag is easily understood. Except for International Battery Metals’ (IBAT) modular and mobile plant, no new lithium from brine or mineral mining projects are expected to come online in the next five to six years. Thus, global production increases will likely only come from expansions of existing resources. Livent may have its new plant in operation by 2030. This plant is scheduled to produce about 40,000 MT/yr. However, it will account for only 1-2% of expected demand by 2030.

Is it reasonable to question such a slow response, particularly when a commodity has such high pricing? The answer is complex. Today, the battery grade production split is about 60% from spodumene and about 40% from brine. In the last five years, I am not aware of any significant increases in lithium from brine production. The reason for this is that, except for the Argentine brine operations of Livent and Alkem, and a small amount of production in China, all commercial lithium from brine production comes from the Albemarle and SQM solar evaporation plants in Chile. Albemarle also produces about 5,000 MT/yr at its Silver Peak solar evaporation operation in the US. Projected production expansion in Chile is small compared to the rapidly growing demand. It should also be noted that both SQM and Albemarle have a history of significantly overstating projected production.

Thus, due to political and environmental issues in Chile and Argentina, permitting constraints in the US and a small global industry that is being seriously stressed, we are not likely to see production normalisation in this industry for a long time. Until recently, the supply/demand position has been short but manageable. The troubling trend is that the gap is expected to widen as we move forward. This statement is supported by Deutche Bank estimates that lithium demand in 2030 will be about 2,800,000 MT. Supply is expected be only about 1,900,000 MT.4

Demand is clearly outrunning supply and the gap is expanding. Battery electric vehicles (BEVs) and hybrid electric vehicles (HEVs) are starting at a very low base of less than 3% global penetration.  Several countries and California have enacted regulations that will significantly limit sales of internal combustion vehicles. One group is estimating that the global EV penetration will be about 20% by 2030.5

Building new capacity

Obviously, we need to build many new, large plants. However, this is proving to be a very slow process. Part of the problem is that, except for spodumene mining operations, little capital has been focused on green field brine based projects. This likely reflects a key issue that has hampered the industry over the last 15 years.

Many large-scale lithium extraction and mining projects have failed. Examples of this are Nemaska, in Canada; Tenova Bateman, in Argentina; Symbol, in the US; Pasco in Argentina; and numerous others. These failures have clearly depressed the mood of investors. We have seen substantial capital moving into traditional spodumene mining and production. But, there is little activity in the brine-based operations. There are several key reasons for project failure.

New project risk

The question of project failure is very significant. New project ideas are risky due to lack of experience, inadequate R&D, incomplete engineering, and design flaws. In some cases, corners are cut to meet predetermined project budgets.

New technology

New technology is very risky. Often, new ideas have not been adequately tested and properly scaled, or the technology is being applied in a different format or on an inappropriate resource. Many times, details become huge problems.


Traditional lithium production plants are expensive. Livent’s new plant announcement in 2021 described a 20,000 MT plant with an estimated capital cost in excess of $600m. In 2022, Livent announced that it intended to double the production to 40,000 MT with a cost of about $1.2bn.

It is important to note that, in order to produce one million MT of new lithium production, the world must build the equivalent of 50 new 20,000 MT plants. At $600M/ plant, the capital investment will be $30bn. By 2040, the industry must build about 4,000,000 MT of mostly new capacity. The estimated capital for this endeavour will be about $120bn.


Due to brine project issues, listed above, spodumene will likely continue to lead the industry in production. However, mineral processing from spodumene, rhyolite, and clays are the antithesis of our global environmental goals.

Developing and starting up a mineral mining and extraction process is a long and tedious undertaking, due to a blend of government regulations, societal concerns, available capital, project management, and construction issues.


Outside of the US, typical mine permitting time is approximately two years. It is eight to ten years within the US. The primary issues are environmental concerns and impacts on various special interest groups.

Resource validation, engineering, project management, construction, and start-up
These activities require a lot of time. In some cases, complex projects can require years to design and build. For classical mining, this can require four to eight years beyond, engineering, resource validation, and permitting.

Lithium brine projects

New brine projects must undergo similar steps.  However, they are also facing significant headwinds.

There is a de facto moratorium on new lithium projects in Chile, due to the environmental and political issues. Water issues and salt pollution in the Atacama have caused serious internal problems, protests, and riots.

Once permits are issued, new solar evaporation projects will require an additional six to eight years to build and start-up. Some solar evaporation projects have required over 12 years to become fully operational. Additionally, brine composition can be a significant issue.

Argentina is currently chaotic. There is a scramble to obtain good quality salars and begin operations. However, the process of obtaining NI 43101 resource studies is very slow in Argentina due to a lack of companies that can drill sample and analyse the resources.

Direct Lithium Extraction from brine

The term ‘Direct Lithium Extraction’ (DLE) connotes a process in which lithium is selectively extracted from a brine. The goal is to remove only the lithium and, in most cases, chloride ions. To date, there is only one commercial Direct Lithium Extraction plant outside of China: Livent’s plant that started up in 1998. Since then, one solar evaporation plant owned by Alkem, formerly Orocobre, and no Direct Lithium Extraction plants have come online in the Lithium Triangle. Several DLE plants have been built in China. However, production from these plants is very low. 6

Most DLE projects are still in the laboratory or in early-stage piloting. Some have done field trials.  However, there have not been any documentable successes except for IBAT’s independently verified field trial of its commercial-scale modular system extraction plant.

The key message concerning DLE extraction is that it is not easy. Resource selection, design criteria and operational parameters are very important to the establishment of effective operations.

In recent years, there has been a lot of excitement in the industry about new DLE projects. Numerous projects have been announced. However, all the noise has produced very little lithium. A few of these companies have built and tested pilot operations.

IBAT’s lithium from brine extraction plant is the first production-ready modular and mobile lithium extraction plant in the world. This patented plant was thoroughly tested and independently validated by SLR, a leading international engineering firm.

IBAT’s technology provides several key advantages. Estimated capital costs are substantially lower than traditional stick-built plants. IBAT’s patented technology can be implemented in one to two years, depending on plant location and size.

Environmental impacts

Environmental, social, and governance (ESG) ratings for spodumene, rhyolite and clay production should be a red flag. We need to recognise that, when we extract lithium from these minerals, we are adopting very environmentally damaging technologies.

Spodumene processing produces about three times as much CO2 as brine operations. NOx, and SOx are correspondingly higher. These numbers could be much higher than estimated because virtually all of the world’s spodumene production is processed in China, where the primary fuel is coal and there is little concern for the environment.

Security of supply concerns also exist. Not only does China process essentially all the world’s spodumene, accounting for about 60% of global LCE production, Chinese plants also upgrade a large amount of brine-based tech grade lithium to battery grade.

Facilitating the global energy transition

The issues described above raise the obvious but painful question. How will this industry manage sudden unprecedented growth and maintain its environmental integrity? Certainly, expanding existing projects will be useful. Streamlining regulatory requirements will help. Starting more projects will have an impact. However, conventional projects with stick-built plants cannot be built fast enough to alleviate the demand issues for the foreseeable future. New conventional projects require many years to design, engineer, construct and start up. The industry needs plants that can be implemented in months rather than decades with much lower capital expenditures.

IBAT’s modular and mobile extraction technology is a viable option. IBAT’s production plants can be built in less than a year and transported directly to specific resources. Start-up of these modular facilities is straightforward and rapid. Thus, a new extraction plant can be located on a resource, producing lithium chloride for shipment to a product’s plant in less than two years.

IBAT’s patented, modular technology is also very clean. The plant design includes proprietary equipment that allows for the recycling of up to 98% of its process water. Water is a precious commodity that must be protected. IBAT is committed to not waste precious water sources.

Brine from IBAT’s plants can be reinjected back into the brine resource, eliminating huge salt piles, and preserving the brine resource hydrology. IBAT’s plants will also utilise renewable energy when possible. This will dramatically decrease our carbon footprint. We must not fall into the trap of sacrificing ESG standards as we transition to electrification.

The world is shifting to electrification. It is imperative that we manage this shift intelligently. Increasing production of key lithium products is a given. However, we cannot sacrifice our environmental standards in the process.


  1. Ionic Clay’s Potential for Sustainable Rare Earths Processing, Investing News Network, November 1, 2022
  2. LCE stands for Lithium Carbonate Equivalent. It represents all lithium production, calculated as if it is lithium carbonate, Li2CCO3
  3. McKinsey & Company, Marcelo Azevedo, Magdalena Baczynska, Hen Hollman, and Alessandra Krauze, April 22, 2022
  4. Investor’s Business Daily, Jed Graham, 10/07/2022
  5. Global EV Outlook 2022, Securing supplies for an electric future, International Energy Agency,
  6. From Catamarca to Qinghai: The Commercial Scale Direct Lithium Extraction Operations, Ales Grant, Principal, Jade Cove Partners San Francisco, USA, April 2020

Please note, this article will also appear in the thirteenth edition of our quarterly publication.

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Contributor Details

John Burba

Executive Chairman & Director of Global Technology
International Battery Metals Inc
Phone: +1 (0)7024006574
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