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Rio Tinto’s real prize: Arcadium’s lithium extraction technology
The direct lithium extraction (DLE) industry is poised for a significant transformation, with projections indicating it could exceed $10 billion in annual revenue within the next decade. This growth is attributable to the rise in demand for lithium for electric vehicle (EV) batteries, alongside the development of DLE technologies that promise to streamline lithium extraction from brines more efficiently than traditional methods.
DLE techniques differ in their approaches, but are fundamentally similar to the filtration systems used in common household water softeners, achieving extraction rates of 90% or more—far superior to the 50% extraction rates typical of the conventional evaporation pond method, which is lengthy and environmentally taxing. Despite various companies racing to be the first to deploy a commercial DLE operation devoid of ponds, none have yet succeeded.
The Genesis of DLE Technology
Pioneering the development of DLE technology was Arcadium, a company whose precursor established an early version back in the 1990s in Argentina. Although this site still employs ponds in tandem with DLE methods, Arcadium’s extensive experience and operational history position it as a sought-after asset for major players in the lithium sector, particularly Rio Tinto, which is keen on pushing forward with DLE initiatives in Chile. Here, regulatory changes are mandating the transition from evaporative methods to DLE, marking a shift in industry standards. 
“DLE is actually the solution to provide the lithium that the world needs,” Rio Tinto CEO Jakob Stausholm remarked during a recent investor presentation. The strategic acquisition of Arcadium, valued at a 90% premium over its market price, highlights Rio’s commitment to securing advanced lithium extraction capabilities.
The Complexity of DLE Implementation
While Rio Tinto has a solid foundation in hard rock mining, it lacks extensive experience in the intricacies of chemical processing that underpin lithium extraction. The DLE process involves a series of complex steps, often exceeding twenty, from the initial treatment of lithium brine to the final crystallization stages. Each lithium brine deposit presents unique challenges, requiring thorough chemical analysis of elements like calcium and magnesium.
Arcadium CEO Paul Graves emphasized the importance of expertise and established infrastructure in successfully implementing DLE technology, stating, “The key to unlocking initial implementation… is that know-how plus infrastructure. But once you have unlocked it, it’s incredibly quickly replicable.”
Notably, Arcadium has invested in a subsidiary of EnergySource Minerals, a DLE developer with projections to begin commercial production by 2025. This collaborative effort underscores the potential for rapid advancements in DLE technology.
Competitive Landscape in DLE
As Rio Tinto aims to popularize DLE, it will inevitably encounter significant competition, notably from those who have previously contributed to Arcadium’s status as a leader in the field. For instance, the scientist behind Arcadium’s original DLE development now leads International Battery Metals, which has introduced a modular DLE facility attracting interest from major oil companies.
Additionally, industry titans such as Albemarle and SQM are investing in DLE testing and production enhancements across the globe, leveraging their extensive lithium extraction experience. Eric Norris, head of Albemarle’s energy storage division, highlighted the necessity for chemical processing expertise in DLE, noting the wealth of knowledge companies like Arcadium possess.
Other emerging contenders include Vulcan Energy, privately-held EnergyX, and Standard Lithium, all actively innovating their own DLE solutions.
The DLE industry is rapidly evolving, driven by growing lithium demand for EV batteries and the technological advancements that promise a more sustainable and efficient extraction process. As competition heats up, the focus will increasingly be on companies that can meld technological expertise with operational efficiency to lead in this burgeoning market.
