Rio Tinto-Backed Lithium Startup Secures Funding Amid Market Volatility
MELBOURNE, Nov 25 (Reuters) – ElectraLith, a lithium technology startup supported by Rio Tinto (RIO.AX), is poised to close a funding round in the coming week, aiming to secure A$27.5 million (approximately $17.8 million). This comes as the global lithium market faces headwinds, according to the company’s Melbourne-based CEO.
ElectraLith is focused on a filtration technology designed to extract lithium from brine deposits. This Direct Lithium Extraction (DLE) method distinguishes itself by eliminating the need for water or chemicals, making it particularly suitable for arid regions such as Chile’s Atacama Desert and minimizing energy consumption.
“The lithium market is not great, venture capital markets aren’t great, (so) the fact we are about to close this round with an oversubscribed investor base … for us that’s fantastic,” Charlie McGill, CEO of ElectraLith, told Reuters.
Several companies, including Exxon Mobil (XOM.N), are vying to commercialize their own DLE technologies. The industry is anticipated to surpass $10 billion in annual revenue within the next decade.
This DLE approach is expected to revolutionize lithium production, accelerating the extraction process to a matter of hours or days—a significant improvement over the months required by traditional methods involving evaporation ponds and open-pit mines.
ElectraLith’s proprietary DLE-R process utilizes two membranes to filter brine, extracting lithium and converting it into lithium hydroxide. The remaining brine is then returned to the aquifer.
McGill stated that the company is working to scale the membrane technology for large-scale projects while maintaining its efficiency and retains all commercial rights.
The funding will allow ElectraLith to construct its first pilot plant at Rio Tinto’s Rincon operations in Argentina. McGill noted the pilot project is slated to commence in about a year. Two additional pilot plants are planned to follow. Currently, the company is backed by venture capital firm IP Group, Rio Tinto, and Monash University, where the membrane technology was developed under Professor Huanting Wang.
ElectraLith claims its process enables production of lithium hydroxide at approximately half the cost of competitors, owing to its water- and chemical-free methodology, according to McGill.
“The availability of water in the regions where there are lithium mines is a major problem,” he said.
In Utah, where ElectraLith is conducting a project with Australia-listed Mandrake Resources (MAN.AX), obtaining water permits is a major hurdle, especially when water from the Colorado River basin must be allocated to major population centers.
“You can’t get a water permit,” McGill stated. “So we show up and we are like, ‘We don’t need water.'”
