Lithium Valley: California's Newest Gold Rush

Lithium Valley: California's Newest Gold Rush

The auto industry is set to introduce fleets of electric vehicles powered by lithium-ion batteries, but the US has been slow to invest in mining and extraction.

That's about to change with the development of lithium operations powered by clean energy in California's "Lithium Valley."

Companies are racing to strike it rich in a region with massive quantities of lithium.

Eric Spomer, president of EnergySource Minerals, says the resource could produce over 300,000 tons annually, which is more than half the world's supply of lithium.

EnergySource Minerals plans to build a billion-dollar lithium facility that could be ready for commercial use by 2025.

It would extract lithium from the brine already being brought to the surface by geothermal electric plants.

The Salton Sea region's geothermal brine produces steam, which drives turbines to generate electricity.

In the past, the mineral-rich brine was simply returned to the earth.

Now, companies plan to extract lithium from the brine before reinjecting it underground.

The amount of lithium in the region is staggering. Spomer says the region could recover enough of the metal to support 7.5 million electric vehicles a year, half of the total car and truck sales in the US.

EnergySource Minerals is not alone in the lithium rush. Warren Buffett's BHE Renewables runs 10 geothermal energy plants in the region, and Controlled Thermal Resources is developing a new plant for recovering lithium.

The lithium extraction process currently costs about $4,000 per ton and sells for six times more.

As companies seek to benefit from the region's lithium, others ask if it will work for everyone. The rich lithium resource lies beneath one of the poorest sections of California.

The Salton Sea was created when the Colorado River flooded the basin in 1905.

For the past 50 years, the main source of water has been chemical-laden agricultural runoff, and the sea has been evaporating and shrinking, causing environmental decay, toxic dust, and economic hardship.

The lithium industry could provide better jobs and be a force for good in the area, but environmentalist Frank Ruiz says industrialization must be reconciled with wildlife and communities.

Demand for electric vehicles continues to grow, with over 50% of Stellantis' lineup and retail sales being battery electric vehicles by the end of the decade.

Stellantis has committed to purchasing lithium from Controlled Thermals Resources, and General Motors has also committed to purchasing lithium from the Salton Sea region.

As the tax incentives in the 2022 Inflation Reduction Act drive down prices for electric cars, domestic lithium investment is a competitive advantage.

"It's an opportunity that we can be a leader globally. And why not lead?" said Spomer.

Join the Lithium Valley rush and be a part of the newest gold rush.