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Thursday, Feb 22, 2024
Mugglehead Magazine
Alternative investment news based in Vancouver, B.C.

Lithium

Lithium extraction tech developer EnergyX continues to attract major investors

General Motors and the South Korean conglomerate POSCO have been helping the company raise funding

Lithium extraction technology company EnergyX attracts major investors
Company Founder Teague Egan (centre right) in Argentina last month. Photo credit: EnergyX

A lithium extraction technology startup founded in 2018 claims to be able to get the commodity out of the ground 300 per cent more efficiently than conventional methods can.

Its innovation in the industry and creation of “Lithium Ion Transport and Separation” (LiTAS) technology has attracted the attention of major companies like General Motors (NYSE: GM) and the United States Department of Energy. Michigan’s GM agreed to lead a US$50 million financing round for EnergyX in April last year. The DOE gave the company a US$5 million grant for lithium extraction in California.

“EnergyX is developing a novel direct lithium extraction process that’s not only cost competitive but also will reduce energy, land and water usage as compared to the current extraction and processing options for brine-based lithium,” a GM representative said last spring. It uses 80 per cent less fresh water than conventional methods, EnergyX says.

South Korea’s Pohang Iron and Steel Company (POSCO) (KRX: 005490) and a consortium of other investors from the country later chose to assist with the funding round in October. EnergyX is currently building a demonstration plant for its technology near POSCO’s Sal de Oro project in Argentina’s Salta province.

Lithium extraction tech developer EnergyX continues to attract major investors

EnergyX ‘Test Bed’ in Argentina’s Salta province. Image credit: EnergyX

“We’re viewing POSCO as our flagship customer for Argentina,” EnergyX Founder Teague Egan told Reuters last fall. “We hope this evolves into a full-blown commercial agreement.”

In 2022, the private equity firm Global Emerging Markets invested US$450 million in EnergyX.

The Florida-based tech developer plans to license its LiTAS system to other operators and develop its own lithium resources.

Egan and his company have had over 4,600 investors to date. He just attended the World Economic Forum’s annual meeting in Switzerland.

Read more: Lithium South near completion of production well and economic assessment at flagship operation

Read more: Lithium South and POSCO Holdings ink mutual development agreement

Technology beneficial for lithium brine developers

Due to its ability to significantly reduce water consumption, the need for other materials and labour, the LiTAS technology could be a game changer for companies developing lithium brine. This is particularly true in Chile, Bolivia and Argentina’s Lithium Triangle, which holds over 65 per cent of the world’s brine resources.

Lithium mining companies are primarily active in Chile and Argentina’s portion of the triangle. Chile’s mining industry is primarily controlled by the state but Argentina’s is not.

The state-owned copper company Codelco and the industry giants Sociedad Química y Minera de Chile (SQM) (NYSE: SQM) and Albemarle Corporation (NYSE: ALB) are Chile’s only lithium producers.

Several early-stage miners like Lithium South Development Corporation (TSX-V: LIS) (OTCQB: LISMF) (Frankfurt: OGPQ) have found Argentina’s regulatory environment to be more beneficial while majors like Arcadium Lithium plc (NYSE: ALTM) (ASX: LTM) capitalize on the nation’s resources too.

All of these companies are likely to benefit from EnergyX’s technology in the coming years. It “incorporates proprietary membranes, solvents and/or adsorbents to improve lithium recovery for existing and new Li-brine resource producers,” the company says.

In 2021, EnergyX established a 40,000-square-foot laboratory and pilot facility in Austin, Texas. Last fall, Egan gave a tour to Sandy Munro from the engineering firm Munro & Associates.

 

Lithium South Development Corporation is a sponsor of Mugglehead news coverage

 

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