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Lithium from salt water could make batteries, and EVs, less expensive

Lithium demand, seen doubling in the next eight years on sales of batteries used in electric vehicles, is spurring a U.S. company to build a factory to extract the metal from brine in California.

Simbol Materials LLC’s proposed Imperial Valley plant near the Mexican border would slash the time and cost needed to extract lithium from salty water, Chief Executive Officer Luka Erceg said in an interview. The closely held, Pleasanton, California-based company may boost output from an initial 8,000 tons a year to as much as 64,000 tons by the end of the decade, Erceg said, equal to 21 percent of projected global demand.

Simbol is among prospective lithium producers that are trying to break into a market dominated by four companies including Princeton, New Jersey-based Rockwood Holdings Inc. (ROC) The price of the lightest metal, used to make long-lasting batteries for laptops, power tools and now electric vehicles, jumped 35 percent in 18 months, according to Jonathan Lee, an analyst at Byron Capital Markets in Toronto.

“Electric cars are eventually going to become a bigger part of auto sales, and given that they require hundreds of times the amount of lithium needed for laptops, that’s going to really increase demand,” Chris L. Shaw, a New York-based analyst at Monness Crespi Hardt & Co., said yesterday in a telephone interview.
Hybrid Demand

Global demand will double to 300,000 tons by 2020, according analysts at Dahlman Rose & Co. Sales of 1 million electric vehicles a year would more than double battery-grade lithium use which is currently 40 million pounds (18,144 tons), Rockwood Chief Executive Officer Seifi Ghasemi said Sept. 11 in a presentation.

Each electric vehicle uses about 50 pounds of lithium and hybrids each use about 20 pounds, compared with about 0.1 ounce for a mobile phone and about 1 ounce for an iPad, Ghasemi said. About 40,000 electric vehicles and hybrid plug-ins were sold globally last year, according to the EV City Casebook, a report published on the International Energy Association’s website.

By 2020 there will be annual sales 3.9 million hybrid vehicles, 1.4 million plug-in hybrids and 2.8 million fully electric plug-in vehicles, Erceg said.

While lithium is mined from ore, brine evaporation is the lowest-cost source. Simbol’s technology takes brine from geothermal power plants and extracts minerals via a so-called reverse osmosis filtration system in a process that takes 90 minutes to 2 hours. Conventional methods using evaporation can take 18 months, Erceg says.
Evaporation Process

Brian Jaskula, a mineral commodity specialist for the U.S. Geological Survey, said Simbol’s method could be a breakthrough.

“If they can eliminate the evaporation process, they can produce at a much lower price point, which would be great for the industry,” he said.

Toronto-born Erceg, 41, has a master’s in business administration degree from Rice University in Houston and a law degree from South Texas College of Law. He worked at El Paso LLC, CenterPoint Energy Inc. and Philip Services Corp. for 15 years before co-founding Simbol.

The company’s other founders are Carol J. Bruton and Brian R. Viani, who previously worked at the Lawrence Livermore National Laboratory, and M. Scott Conley. The four are shareholders in Simbol, alongside Itochu Corp., Firelake Capital Management LLC and Mohr Davidow Ventures.

Erceg said he expects construction on the first California plant to begin at the start of 2013. He declined to disclose the cost of the project.
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