WE NEED MORE LITHIUM.

There is one central, unavoidable fact about lithium: we need more of it. If you care about climate change, we need more lithium to have a shot at meeting our electrification targets. If economic security is more your thing, then we need more lithium so we aren’t at the mercy of foreign supply chains. If all you care about is driving fast cars, well, we need more lithium for that, too.

This was all true when we started Lilac, and it’s even truer today. Tracking daily spot prices for lithium is a rollercoaster, but if you look toward the future, we are facing a structural imbalance between supply and demand as far as the eye can see. By 2035, the deficit is conservatively estimated to grow to 900,000 tonnes of lithium carbonate equivalent (LCE) per year, or about as much as the entire world produced in 2023.

Another way of looking at the problem: if we don’t unlock lithium supplies that are affordable, scalable, and secure, all the EV targets announced by auto makers are dead-on-arrival.

SO, LET’S GET MORE LITHIUM.

There’s just one problem: the incumbent production methods aren’t good enough.

Evaporation ponds have had their day in the sun (pun intended). Beyond some special locations (a handful of salt flats in remote deserts), they just don’t work. And the only alternative technology in use today, aluminum absorbents, are just as flawed.

Aluminum absorbents were first commercialized 25 years ago but have failed to make a dent in global lithium production, despite numerous attempts by different players. They struggle with low lithium concentrations, relying on evaporation ponds to concentrate up the brine. They have low yields, wasting most of the lithium. They struggle to reject impurities, which are extremely high in U.S. resources. They need pre-heated brine to be effective, which consumes lots of energy. Last, but certainly not least, they consume ungodly amounts of freshwater.

Enter Lilac. We’ve developed an innovative ion-exchange (IX) technology that uses 10x less freshwater than aluminum absorbents, completely eliminates the need for evaporation ponds, and can unlock production from new brine resources that were previously considered untouchable. And our technology is modular for rapid scale-up, leveraging 100% off-the-shelf equipment.

SOUNDS GREAT. DOES IT REALLY WORK?

I’m so glad you asked. While our most recent project is in the U.S., over the last few years we’ve also developed technology partnerships with many of the biggest lithium resource owners globally. In fact, we now have 10+ large-scale projects under development across three continents. This has given us several opportunities to show that our technology, Lilac IX, works as well in the wild as it does in our labs. These customer engagements continue to expand with new partnerships around the world.

The project that has received the most attention is Kachi, an Argentine site that we are developing in partnership with Lake Resources. We recently completed a successful Demonstration Plant on-site at Kachi, where we got a chance to show off the performance, reliability, and operability of Lilac IX at scale, using a live source of brine from the wellhead. You can read up all about the project and key achievements here, but if you want to save some time: it works! We notched 80% recoveries while rejecting 99.9% of impurities. And we’re not just cherry-picking data from a good day. The demo plant ran continuously for months and maintained 90% uptime during 24/7 operations. We even had multiple third-party engineers visit the plant to collect their own data and validate the results because that sort of performance is, well, atypical in our line of work.

LILAC WAS MADE FOR THE GREAT SALT LAKE.

The Great Salt Lake is an icon of the American West and a massive lithium resource hiding in plain sight. But the lithium concentration in the lake is only 60 mg/L – about 20x lower than most production in South America. Prior lithium developers on the lake have tried to leverage aluminum absorbents, but these require massive evaporation ponds to be successful. Nowhere would the use of evaporation be felt more acutely than at the Great Salt Lake, where a once-in-a-thousand year megadrought enveloping the entire U.S. West has already brought water levels dangerously low and heightened awareness to the environmental impacts of conventional resource extraction.

Even with the lake water having a lithium concentration of only 60 mg/L, we’re able to directly recover 65% of the lithium, losing only 20 mg/L, without any evaporation ponds. This compares to operations in South America, where typically 400-1,000 mg/L of lithium is wasted from the brine. Critically, Lilac returns all water to the lake with no change in chemistry, aside from removal of lithium. This means that our water pumping is non-consumptive and does not negatively impact the lake. Lilac IX has achieved a massive step change in technical and environmental performance, unlocking scalable lithium production from the Great Salt Lake.

We have engaged local stakeholders and regulators early and often to ensure that our resource development plans meet the State of Utah’s vision for environmentally responsible lithium production on the Great Salt Lake. The next step for this project involves deployment of a field pilot later this year. Then, we’ll propose to regulators a first phase of commercial production totaling 3,000 tonnes per year of lithium carbonate by 2026. Ultimately, the lake can support up to 20,000 tonnes per year, which would be part of a future proposal.

Crucially, this project would be a new domestic supply of lithium for the U.S. economy. Together with our manufacturing facility in Fernley, Nevada, which will produce the IX beads needed to drive the extraction process, the Great Salt Lake project will help create a vertically integrated domestic supply chain of battery-grade lithium for the local EV industry.

READY TO FIRE ON ALL CYLINDERS IN 2024!

Scaling lithium supply for the electric era is easier said than done. That’s why I’m excited to share we closed on $145m of Series C funding to help us pull it off. Our existing investors, including Mercuria, Lowercarbon Capital, Breakthrough Energy Ventures, Engine Ventures, T. Rowe Price, Sumitomo, and Emerson Collective re-upped, and we also welcomed exciting new investors like Mitsubishi to the fold.

I’m also delighted to welcome two new directors to our board to help guide the path ahead, Brian Falik and Ian Pearce, who bring a wealth of experience in investment, development, and operations across the energy and mining industries. Brian is the CIO Americas at Mercuria and has deep experience leading teams of investment professionals in the energy industry. Ian has a 40-year career working for many of the biggest names in the global metals and mining space, and notably served as CEO of Xstrata Nickel.

We’re excited to continue scaling our technology and partnering with resources owners globally, and we look forward to sharing more updates soon!

Dave Snydacker, CEO