Volt Lithium is a Canadian company focused on developing and commercializing sustainable lithium extraction technologies from oilfield brines for the energy transition and battery industries.
Alex, you mentioned that you see the oil and gas industry as a latent leader in lithium extraction. How receptive do you expect the public to be to this form of lithium production?
The public needs to understand better what is happening for it to be receptive. For example, in the Permian Basin, the largest oil-producing basin in the US, for every barrel of oil produced, four and a half barrels of water are generated, and that water contains lithium. The oil and gas industry is already managing and safely handling that water by returning it to the reservoirs it came from. This means that the environmental footprint from lithium extraction in this context is minimal.
In terms of infrastructure, new mining projects require extensive resources and come with environmental risks, but this does not apply here. We are leveraging existing operations without creating a new environmental footprint. This is a way for the oil and gas industry to participate in the energy transition without additional disruption, and it is something right in front of them.
Do you think that the oil and gas industry is ready to embrace collaboration with companies like Volt Lithium?
From my experience, I would say so. Water is not a waste product for the oil and gas industry, but it is not a revenue generator either. By introducing lithium extraction, we are creating a new revenue stream without altering their operations. It is a significant benefit for them overall.
To put it in perspective, I see a clear path to extracting 35,000 to 40,000 tons of lithium per year for Volt Lithium, which adds to the supply to meet the US demand as the country transitions to a locally based lithium economy. It is an efficient approach that does not require new infrastructure, making it a net win for the oil and gas industry. While this is technically new production, I see it as displacing existing production. With the US and Canada imposing tariffs on electric vehicles and lithium batteries from China, domestic lithium extraction offers a cost-effective solution for the North American market.
Volt Lithium is on track to become North America’s first commercial producer of lithium from oilfield brine, as you have just started field testing in the Permian Basin in Texas. What does this testing involve, and when will full-scale production begin?
We built what we call a field simulation center, which was completed last year. This system is designed to operate in the field and has undergone a hundredfold scale-up since spring 2024. That kind of scale-up is one of the most challenging aspects of our business, but we have successfully battle-tested the system and demonstrated that we can scale it.
Currently, the system is built in the field, and we are starting operations with function testing to ensure everything works properly before we begin extracting lithium. Our plan is not just to conduct a field test but to scale up production with this modular system, starting in Texas and expanding from there.
You mentioned that scaling up your process has been a significant achievement. Can you elaborate on what this has involved?
Scaling up from a small demonstration plant to a much larger operation is no small feat. In a small system, extracting lithium is relatively straightforward. However, scaling up by 100 times, as we did, presents substantial challenges. This was not a lab experiment—it was a field-scale demonstration. Prior to this, we had already done a 500 times scale-up, so our progress has been substantial.
Since the summer, we have doubled that scale-up again, meaning we have now achieved a 200 times scale. And I see us continuing to expand further. It has been a complex process, but it is a critical part of moving from a demonstration phase into full-scale operations.
Are you already in conversations with other oil and gas companies to help scale up quickly after this initial phase?
We received a strategic investment from a partner in spring 2024, and our plan is to scale up with them. Once we demonstrate commercial production, we will announce the partnership and provide our scale-up plans. This partner has significant operations, allowing for a substantial expansion with them.
There are other interested parties as well, but we have chosen to start with this partner to show that the process works. Once we have demonstrated that, we will evaluate other opportunities for scaling further.
Do the volatile prices of lithium pose challenges for attracting further investment?
It depends on where a company stands in terms of production costs. We are a very low-cost producer, with all-in operating costs at around $2,800 per ton. This is much lower than others extracting lithium from brines because we do not have the upfront costs of developing a mine. We also avoid the significant transportation and operational costs associated with other methods.
For us, water is already brought to the surface by oil and gas producers. We intercept it before disposal, meaning we do not bear the costs of bringing water to the surface, which gives us a competitive edge.
Given the importance of lithium as a critical mineral, do you feel there is enough support from governments in North America?
I believe that any business needs to stand on its own. Government support is welcome, but a project must be viable without it. We are focused on being industry-driven, and I think that is the best path forward for the sector as a whole.
The US government is certainly interested in what we are doing, but we do not rely on government support. Our aim is to develop this industry through private sector leadership, which has proven successful in other sectors, such as technology.
As you enter production, have you started looking at potential demand-side partners, such as automakers?
Yes, we are under NDA with several groups, and there is significant interest. I am not concerned about our ability to sell the product once we produce battery-grade lithium. The local market for lithium is growing, and we are positioning ourselves as a low-cost provider, which gives us a strong competitive advantage.
Where do you see Volt Lithium in a year, and what are your main objectives moving forward?
By this time next year, I see us in full operations and scaling up. We will be transitioning to a cash-flow-generating business by the end of 2024 or early 2025. With a clear plan in place, we expect to significantly expand our operations alongside our partner, positioning ourselves for growth in the coming years.
