- The lithium price continues to trend as demand for EVs exceeds supply due to material and refinery bottlenecks.
- Most of the world's lithium is extracted from mineral-rich brine and hard rock deposits.
- Lithium Triangle alone possesses 47 million tonnes of lithium resources, nearly 65% of the world’s total.
Demand for critical minerals to manufacture batteries for electric vehicles (EV) has been increasing full on. Since mid-2021, the global EV industry has been struggling with the shortage of key battery materials, primarily due to the COVID-19 pandemic. This includes essential elements such as cobalt, lithium, nickel and graphite.
The lithium price continues to grow as demand for EVs exceeds supply due to material and refinery bottlenecks. However, lithium is not a rare mineral, and an ample amount of it is present in the world. It is the 33rd most abundant element present in nature and is distributed widely in trace amounts in soils, rocks, seawater, surface and ground. The good news is that there is plenty of lithium that the world needs to mine in order to satisfy the burgeoning demand for it.
The mining of the critical mineral involves expensive extraction techniques and takes a long time which raises barriers for miners to enter the business.
In the backdrop of this, let's have a look at where lithium is found.
How is lithium mined?
Most of the world's lithium is extracted from mineral-rich brine located roughly 10 meters beneath salt flats containing briny lakes at high altitudes. The process of extracting lithium from brines involves drilling and pumping brine up to the surface into evaporation ponds. The pumped brine is left for months in these ponds, which creates a salty mud containing a mixture of borax, potassium, manganese and lithium salts.
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After 12-18 months, the mixture is sufficiently distilled to extract lithium carbonate, the main raw material used in lithium-ion batteries (LIBs).
Apart from brines, lithium can be extracted from hard rock deposits where lithium is present in pegmatites, which are intruding rock units formed when mineral-rich magma intrudes from magma chambers into the crust. Within Pegmatites, a lithium-bearing mineral known as Spodumene is present. Lithium from pegmatites can be used to create lithium hydroxide or lithium carbonate.
Who are the biggest lithium producers?
Brines are a cost-effective and favorable source for extracting lithium. The lithium Triangle that connects Bolivia, Chile and Argentina is the biggest source of lithium brines in the world. This is the most effective and economical method for extracting lithium carbonates. However, the process is extremely water-intensive.
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As per the US Geological Survey, the Lithium Triangle alone possesses 47 million tonnes of lithium resources, nearly 65% of the world’s total. Chile contains the world’s largest lithium reserves at 9.2 million metric tonnes, as per the 2022 USGS Mineral Commodity Summaries, followed by Australia and Argentina which contain 5.7 million metric tonnes and 2.2 million metric tonnes, respectively.
Casting a glance at production figures, Australia was the leading lithium producer in 2021, producing nearly 55kt of lithium followed by Chile.
Most of the lithium across the globe is mined from brines and hard rock deposits where lithium is present in pegmatites. Chile is one of the biggest sources of brine lithium deposits, while Australia is well known for hard-rock lithium deposits.