Lithium companies are testing direct extraction methods as an alternative to the giant evaporation ponds used to produce the battery metal. , Photographer: Cristobal Olivares/Bloomberg
The advances are collectively known as direct lithium extraction, or DLE. They promise to be cheaper, faster and greener than traditional lithium production in South America, which holds about half of the world’s reserves of the silvery white metal. DLE would also unlock new supplies in North America, including recovering the metal out of the salty water produced by oil drilling.
Lithium prices surged to record highs last year as growth in demand from the EV boom saw markets tighten. Prices have since fallen amid a steady stream of new output from Australia, though remain elevated thanks to an upbeat outlook for EV growth. An expected shortfall from 2025 is driving startups, miners and even Big Oil to chase new ways to expand supply.
As simple as it is profitable, that process uses far less fresh water, chemicals and energy than hard-rock mining as practiced in top producer Australia. But the evaporation method means billions of liters of brine are vaporized in one of Earth’s most arid places, which some say is a threat to wildlife such as pink flamingos that inhabit its Mars-like landscape.
“The future of DLE technologies is still uncertain, and the long-term feasibility must be evaluated,” SQM said in a written response to Bloomberg questions. The world No. 2 producer is negotiating a new contract under Chile’s recently announced public-private model that includes a requirement for more sustainable practices.