“We’re probably at least 10 times larger.”
That’s Vincent Ramirez, CEO of 3PL Operating, Inc., talking about a large and valuable lithium discovery his company has made in Railroad Valley, Nev.
“I mean, it just dwarfs any other project in North America,” he said of the discovery in Lake Livada, located in the Tonopah Basin.
As lithium will play a vital role in the world’s changing energy landscape, generally, and because much of the known lithium deposits are in Chile, Australia, Argentina and China, specifically, 3PL’s find in central Nevada is potentially a very big deal. 3PL specifically explores and developed what it calls “locatable minerals.” It has the largest mining claim block yet assembled in Nevada.
All the major players, including automakers, miners and investors, are trying to figure out how much lithium they’ll need in the coming years and from where they are going to get it. And, in fact, it’s not just lithium. There’s sodium carbonate, borax, and gadolinium, which is used in magnetic resonance imaging, as well as neodymium, which, when combined with iron and boron, makes the magnetization used in mobile phones and electronic automobile components.
Oil Science Has the Edge
But Railroad Valley is just part of the story.
“Our work is easily imitated in five minutes,” Ramirez said, “by any normal oil and gas scientist.”
And that is because the techniques used to find this field, to find lithium, are already being used by oil and gas professionals.
Ramirez should know. He is one.
“Because I’m an oil and gas guy and not a mining guy, I used oil and gas techniques to find it. And it turns out, it’s really simple. You just look at oil and gas logs. You look at the resistivity log,” he said.
The brine can be seen.
The miners, he said, would be lost without oil and gas technology.
The new energy frontier, it seems, still needs the old one.
“Canadian miners have had a lot to do with helping to promote it because 100 companies have run down to Nevada, setting up offices,” said Ramirez.
Many of them are part of penny stock companies that are drilling into water and looking for the lithium in the water – and not finding any, he added.
“But because the price of lithium has escalated and it’s a great exploration target and it’s like a gold rush. It’s the white gold rush,” he said.
But many of these “explorationists” are almost comically inept.
“The miners can’t read the log. They’ll call me on the phone and say ‘How do I read that log?’” related Ramirez.
Many times, they don’t even know where to look.
“They’ve been going to the edges of the valleys and drilling these imaginary faults looking for geothermal springs that bring the lithium out of the ground. And that’s just not how the process works,” he said.
He said their present business model is not working.
“As the industry now sits, the mining community has taken ownership of energy minerals and this arrangement is pretty clumsy, to say the least. They don’t even drill in the middle of the valley. They drill on the edges of the valleys. They’re not even finding water, whereas we drilled the center of a big valley and found the huge brine deposit,” explained Ramirez.
We Have Some Catching Up to Do
The larger issues, especially as we enter a less carbon-dependent future, is how much lithium will be needed? According to S&P Global Market Intelligence, demand will increase more than tenfold over the next decade.
There are two sources of lithium: brine and mineral deposits. The former is recovered through a process known as brine mining in which dissolved lithium (and other useful elements) are extracted; the latter is recovered from mines. Most of the world’s lithium is in brine pools in South America – and most of that in Chile, Bolivia and Argentina. Environmentally, since there is no blasting involved in lithium mining and the chemicals used are manageable, the biggest challenge is the amount of water used. It is estimated 500,000 gallons of water are needed to extract one ton of lithium. This puts strains on communities where droughts are already an issue. In Salar de Atacama, Chile, 65 percent of the water was used for mining. Because of this and other economic considerations, some areas heavy in lithium mining are putting the breaks on future exploration, like in Rio Tinto in western Serbia.
Over the past few years, the price of lithium has surged five fold, but, because of the technological improvements, the price of batteries and electric vehicles nevertheless became cheaper. The risk now is that the rising cost of raw materials, lithium in particular, might change that dynamic and could curtail the growth of EVs.
Demand is exceeding supply.
“People talk about meeting demand over supply and this and that, and that’s largely because somebody quoted 460 lithium projects that had started up,” said Ramirez.
The problem, in his opinion, is that of those 460 projects, only 10 of them are actually commercial.
“But what typically happens is that as we don’t meet demand, then the price of lithium will go up. And then better projects will come forward and smarter people will get involved, and then we’ll meet it in that way. But it will follow just like an oil trend. It’ll become the same kind of a market right now,” he explained.
In other words, while industry analysts expect there to be a lithium “deficit” in the coming years, if it hasn’t already started, those projections are based on current deposits and the current technologies and incentives to get those deposits.
That will change.
Even still, according to Ramirez, the current available technology should be used by what he calls a “confident army of scientists” to find more lithium.
“I would like to see other successful companies come in who would help the business,” he said, admitting, “It would be good if we weren’t the only ones with the discovery.”
As brine minerals are regulated by both leasable laws and mining laws in the United States, Ramirez said the help of the scientific community – and AAPG in particular – would be extremely useful for cutting-edge innovators who are attempting to catch up with the strategic mineral programs in other parts of the world.
“China has a ministry of lithium, a ministry of salt, and a ministry of this and a ministry of that and they have a huge national effort to find the lithium and other strategic minerals. They’re 20 years ahead of us. They’ve gone into every lake and they’re developing and they’ve got all the geochemistry categorized and well understood, and we’re still debating like, ‘Where did the salts come from?’” he said.
Ramirez thinks we’re wasting time.
“It would be good for America if we could be self-sufficient from overseas deposits,” he added.
Editor’s note: As of June, NASA has withdrawn a large swath of the Railroad Valley from public use and the mining of lithium for what it said it needs to conduct its “Earth-observing satellite calibration activities,” which has, at the moment, stopped all lithium exploration in the region. Look for this story in an upcoming issue of the EXPLORER.