ElectraLith Raises $19 Million to Advance Water-Free Lithium Extraction Technology

ElectraLith, a lithium technology startup backed by Rio Tinto, expects to finalize a funding round to raise A$29 million ($19 million) within the next week, despite the current struggles in the global lithium market. The company's Melbourne-based CEO, Charlie McGill, expressed optimism regarding the oversubscribed investor base, highlighting the strong interest even in a challenging venture capital environment.

ElectraLith is developing an innovative filtration technology capable of extracting lithium from brine deposits without the use of water or chemicals, a crucial advantage in arid regions like Chile's Atacama Desert. The process also requires minimal energy, making it an attractive solution for sustainable lithium production.

“We are about to close this round with an oversubscribed investor base, which for us is fantastic,” McGill told Reuters.

Several companies, including Exxon Mobil, are racing to commercialize direct lithium extraction (DLE) technologies, which are expected to significantly reshape the lithium market. DLE can reduce the processing time for lithium used in electric vehicle (EV) batteries and electronics from months to just days or even hours, bypassing the need for large evaporation ponds or open pit mines.

ElectraLith’s proprietary process, known as DLE-R, filters brine through two membranes to extract lithium, turning it into lithium hydroxide while injecting the remaining brine back into the aquifer. This method not only eliminates water usage but also minimizes environmental disruption, addressing a key issue in lithium extraction.

The company plans to use the newly raised funds to build its first pilot plant at Rio Tinto's Rincon operations in Argentina, with the project expected to be ready for piloting in about a year. Two more pilot plants are scheduled to follow. ElectraLith’s technology was developed at Monash University under the guidance of Professor Huanting Wang and is supported by venture capital firm IP Group, Rio Tinto, and Monash University.

McGill emphasized that the DLE-R process could reduce costs significantly: “By producing lithium hydroxide without water or chemicals, ElectraLith can compete at around half the cost of its rivals.” The lack of water availability is a major obstacle in regions where lithium resources are abundant, such as the Colorado River basin in the U.S., where ElectraLith is working on a project with Australia-listed Mandrake Resources.

“You can’t get a water permit. So we show up and we are like, 'We don’t need water,'” McGill said, underscoring the competitive advantage of ElectraLith's approach.