White Paper
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Critical Minerals: The Opportunity in Direct Lithium Extraction

Abhirabh Basu

Abhirabh Basu

Senior Analyst

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Anthony Schiavo

Anthony Schiavo

Senior Director and Principal Analyst

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The convergence of political, economic, social, and technological drivers is accelerating the global energy transition. Rising demand, disrupted supply chains, and concerns around shortages of critical minerals such as lithium, cobalt, nickel, copper, and rare earths are driving prices to record highs, as more countries pursue deep decarbonization strategies through renewables and electrification.

Direct lithium extraction (DLE) will phase out evaporation as long-term pressure mounts on the battery supply chain. While DLE is not a new concept, finding the right partners will lead to success. The first commercial projects in DLE were mounted in the ’90s, but current high prices of lithium and growing environmental concerns are driving new interest in the technology.

Improved DLE approaches, including next-generation adsorbents and ion exchange resins, will unlock lithium brines that were previously uneconomical. This will help expand lithium supply, though painful shortages are still likely. In the long term, environmental concerns around the water and land impact of evaporation-based production will cause that approach to lithium production to be phased out in favor of DLE. However, DLE is not a silver bullet — every brine is different, and upstream and downstream partners are needed to succeed in the risky lithium space.

This report focuses on the widening divide between lithium supply and demand and the emergence of new raw material extraction technologies to get this critical metal to market faster. Lithium supply chains not only affect battery producers and automakers, but they also create opportunities for chemicals companies, upstream energy players, and engineering and equipment providers. We lay out a landscape of lithium production approaches and issues and analyze the competitiveness of emerging DLE techniques and unconventional lithium resources.

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