GNS Lithium Extraction Return on Science Triage Assessment

Transcription

1 GNS Lithium Extraction Return on Science Triage Assessment Tijs Robinson, Kerasi Ltd 23 July 2015

2 1 TABLE OF CONTENTS 2 Introduction Lithium Market Overview Lithium Value Chain Economics Of Extraction Using Electrodialysis Potential Revenue Capital Costs Operating Costs Effect of concentration Wairakei Implementation Challenges Other Minerals Analysis and Summary Appendix I Carlton Schematic showing EDR stage Appendix II - Design of Abrera DWTP - Electrodialysis Reversal (EDR) Stage Works Cited

3 2 INTRODUCTION GNS Science have world leading knowledge of geothermal fields, particularly the use of New Zealand geothermal fields as a source of energy generation. The concentrated salt water or geothermal brine is extracted and used as a source of heat for electricity generation; the brine is typically reinjected (in part or in total) after useful heat has been removed. These brines have various concentrations of dissolved minerals, a number of which are valuable commodities, such as lithium. The aim of this triage assessment is to, at a first approximation, characterise the economics of extracting lithium from the reinjected geothermal brines on a large scale. 3 LITHIUM MARKET OVERVIEW Lithium is used in a diverse range of applications including glass, consumer devices, and increasingly electric cars batteries. Increasing demand has raised prices; in turn there has been a rapid increase in prospecting and extraction activity. A small number of deposits are being exploited with the majority of lithium being produced by four companies [1]. World lithium consumption by end-use, 2009 [2] 3% 4% 4% 6% 15% 31% Ceramic and Glass Batteries Greases Aluminium Air Treatment Continuous casting 6% Rubber and Thermoplastics 9% 23% Pharmaceuticals Other Car companies, especially pure-electric vehicle companies such as Tesla Motors are investing heavily into lithium based technologies [3] [4]. Demand for lithium is being driven by the adoption of electric vehicles [5], mobile devices, and electrical grid applications [6]. As increasing demand puts upward pressure on prices this will likely increase investment into lower cost alternatives to lithium in these applications (e.g. potassium-ion [7]). 3

4 Lithium Sources Lithium is found in trace amounts throughout the world, but is found in high concentrations in lithium brines and mineral deposits. Lithium brines are currently the dominant source of lithium due to the extraction cost efficiency over mineral deposits [8]. Lithium brines typically use solar energy to evaporate and pre-concentrate the lithium, significantly reducing the cost of the further processing steps. The growing use of this cost effective process has forced other large producers to develop their own brine sources to remain competitive [9]. The salt flat Salar de Atacama in Chile (below) is the largest lithium brine deposit; in 2010 it produced 60% of the world s lithium [1]. The costs and concentrations of various lithium extraction methods is summarised below: Technique Mining Salar Brines Geothermal Brines Method of extraction Concentration calcination, acid, NaCO3 Evaporation + Soda ash Electrodialysis (proof of concept) Cost per tonne $4,200-4,500 $1,500-2,300 >$4,000 (large uncertainty) Typical Concentration (ppm) ,000 when evaporated 9-47 Geothermal brines contain lithium in varying amounts. There are higher than average concentrations of lithium in brines at Wairakei, New Zealand (13ppm), in Iceland at the Rekanes Field (9ppm), and El Tatio in Chile (47ppm) [11]. [4] 4

5 4 LITHIUM VALUE CHAIN The diagram below illustrates the suppliers, sources products and uses for lithium: Lithium is rarely traded in pure form but instead is sold in a variety of intermediate products, the most common of which is lithium carbonate, which are then processed into valuable compounds sold into various industries (above). Commodity lithium products, pricing and demand are expressed in terms of lithium carbonate equivalent (LCE). 5

6 5 ECONOMICS OF EXTRACTION USING ELECTRODIALYSIS The initial intention of this report was to complete a bottom-up assessment of GNS s proof of concept electrodialysis (ED) method to estimate the scaled-up costs of this technique for lithium extraction from geothermal brine. This would utilise the initial experimental small-scale results GNS had assembled. It became evident that the number of assumptions required to scale from this small scale proof of concept batch process creates significant uncertainty that limits the useful conclusions that could be drawn. In addition, overlaying the impact of (likely) improvements to the method would add further uncertainty to a bottom up analysis. Acknowledging these limitations, a top-down approach has been adopted using largescale commercial ED plants currently used in a different application. The leading large-scale implementation of ED is in desalination plants for drinking water treatment. Desalination plants are used to convert seawater and brackish water to water suitable for drinking and irrigation. Demand is rapidly increasing for such plants, especially in arid regions like the Middle East and Australia. In 2009 there were 14,451 desalination plants [12] worldwide. In 2010 production from these plants was 68 million m 3 of water forecast to grow to 120 million m 3 by 2020 [13]. The largest EDR desalination 1 plant in the world is in Barcelona, Spain. The Abrera Drinking Water Treatment Plant (shown over page) processes river water with variable salinity and dissolved solids (Ba 2+, Sr 2+, Na+, Ca 2+, K +, Cl - and Br - ); further details for the plant s EDR stage are in Appendix II. 1 Electrodialysis reversal (EDR) is based on electrodialysis but uses periodic reversal of system polarity to change ion flow direction and prevent membrane fouling, significantly extending membrane life 6

7 Although of a similar scale, there are likely to be significant differences between a Drinking Water Treatment Plant (DWTP) compared to lithium extraction from geothermal brines using ED. Potential differences include: Palatable and safe drinking water is the primary aim for a DWTP, whereas for a lithium extraction plant liquid is the waste product. Drinking water has much greater regulatory requirements. DWTP are less selective to the solids and colloids that are removed and it is unclear how a more selective target of lithium will affect the overall plant system cost and complexity. Temperatures of geothermal brines are substantially above ambient and this could be usefully applied to improve the efficiency of the system but is unclear whether this has a large impact on the initial capital cost. The EDR process area is just one part of the overall water treatment process, further limiting the ability to make inferences from plant cost. However, numerous treatment and handling steps will also be required for a lithium extraction plant. EDR plant operating costs are energy intensive the energy cost is closely related to the total dissolved solids (TDS) and it is not known whether the process will be selective or require removal of other non-target solids, such as silica, that increase the total TDS. The basic technical overview of the Abrera DWTP system and the possible differences noted above have been briefly reviewed by GNS science staff. It was agreed that the capital costs and operating costs of a similar sized EDR plant for extracting lithium are likely to be the same as or higher than an equivalent volume DWTP. 6 POTENTIAL REVENUE In assessing the economics of extracting Lithium from a field such as Wairakei, it is useful to start with maximum possible income the total value of lithium that could reasonably be extracted from Wairakei, per annum, at current international prices. The following simple calculations are also included as a spreadsheet, to allow GNS staff to change assumptions that drive the model. There is some variance on the reported concentration of lithium at Wairakei [11] [15] but 11 ppm appears to the average reading. In combination with a total geothermal reinjection flow of 180,000 m 3 /day [16] the maximum daily yield of lithium is as follows: ( ) 180,000 = 1.98 t day lithium LCE (Li2CO3) is the commonly traded form of Lithium, and the conversion ratio from lithium to LCE is 1:5.323 [17]. 7

8 = 10.5 t day LCE The price for LCE is currently near USD6,000/t and is expected to stay at or around this price for the foreseeable future 2 : 6, USD63,237 day USD23.1m /year With a conservative lithium recovery rate of 80% (recovery rates for well-established Lithium extraction processes are 85-90%) the likely total realisable revenue per year is: = USD18.5m /year 7 CAPITAL COSTS The capital cost of an ED system capable of processing very large volumes of water per day is challenging to estimate with any degree of accuracy in the absence of detailed technical plans. As noted, the largest installations that use ED(R) are water treatment plants, and the single largest plant in the world is at Abrera in Spain. Abrera is very similar in processing capacity to Wairakei total flow (200,000m 3 vs 180,000m 3, respectively). This plant was recently upgraded by EDR supplier GE (formerly Ionics); the upgrade cost alone was EUR61m (~USD75m). Pro-rating Wairakei flow rate (cf Abrera), against the Abrera upgrade costs results in an estimated USD68m for a plant capable of processing 180m 3 /day. Another large installation (Carlton DWTP, Sarasota County, Florida see Appendix I for more detail) is approximately 25% of the size of Wairakei (45,000m 3 /day). The costs of the EDR stage of this plant, when installed in the mid-90s, totaled USD24.1m 3 (for reference, the total Carlton water treatment plant project cost was ~US100m). Pro-rating this to a Wairakei sized plant, and ignoring inflation, suggests a capital cost of USD96m. The 4 x scale up from the Carlton plant to a Wairakei sized plant is likely to realise substantial economies of scale. Contrasting these economies of scale-up from Carlton while applying slight diseconomies for Abrera DWTP suggests ~USD80m is a reasonable approximation for the costs of a Wairakei sized ED plant. 2 Booms.html

9 8 OPERATING COSTS Two approaches were used to estimate the operating and maintenance (O&M) cost to run the plant. Together they were used to arrive at an O&M cost of USD12.5m/year (or USD0.19/m 3 ). This was an average of the following: 1) Abrera consumes 210MWh per day, 71% specifically for the EDR stage; assuming USD0.06/kWh, this results in an annual electricity cost of $3.3m 90% pro-rating for a Wairakei sized installation results in annual electricity costs of ~USD3m. Energy costs in EDR plants are estimated to make-up 25% of all O&M costs [20]. This suggests an annual operating cost of ~USD11.9m for a Wairakei sized plant. 2) Scaling up from an analysis of smaller water treatment plants [19] by pro-rating the O&M costs for a 20MGD (75000 m 3 /day) water treatment plant reaches an annual cost of USD13m. 9 EFFECT OF CONCENTRATION A proportion of the hot brine could be used as a means of concentrating the remaining brine, to raise the lithium concentration. This in turn would likely reduce the size and therefore capital and operating costs of plant required to process the resulting concentrated brine. However, this brine stream used for heating could not be used for lithium production, instead it is assumed it would mostly be reinjected once used ; importantly, the lithium contained in this waste brine would be lost. A high level estimate using ideal heat transfer and water evaporation per hour suggested that to achieve a significant concentration (from 11ppm 500ppm, for example), at least 90% of the flow would be diverted (wasted) for heating. A reduction in total lithium extraction of this scale is likely to severely impact the extraction economics. More detailed analysis of trade-offs may yield more positive results but the initial analysis did not support the merits of this approach. This approach also did not consider the costs (land, capital) of the evaporation ponds required which rely on surface area. To provide some perspective, if the ponds were 1m deep, a single day s flow from Wairakei would require at least 18 hectares of land. 9

10 10 WAIRAKEI IMPLEMENTATION CHALLENGES The above analysis of potential revenue and costs (capital and operating) was based on an idealised single plant processing the entirety of Wairakei s geothermal brines. In reality, due to the location of electricity plants, production wells, reinjection wells and other practical considerations, it is likely at least two lithium processing plants would be required. This would increase operating and capital costs as economies of scale are lost. A much greater impact however results from the available feedstock; assumptions in earlier sections used the maximum throughput of 180,000m 3 of brine per day. Discussions with GNS suggest that a more realistic maximal feedstock would be closer to 36,000m 3/ /day or 20% of the total reinjection flow modelled above, to be split between two plants. The need for two plants, each with only 10% of the throughput of an ideal single plant has not been modelled, but will make the economics significantly less attractive. 11 OTHER MINERALS Lithium is of considerable interest due to the higher than typical concentration at Wairakei and the current value of lithium. There are however other dissolved minerals for which their extraction represents a potential income stream (as for lithium) and/or a reduction in costs for the geothermal plant operator. Specifically, silica is contained in very high concentrations and causes issues for reinjected fluids. While this may present a commercial opportunity (though this is unclear given current global demand), this was beyond the scope of this project. It is also understood that Silica extraction is currently being commercially considered at a New Zealand geothermal generation site. 10

11 12 ANALYSIS AND SUMMARY The financial projections using water treatment plants are not intended to be robust economic models, however they provide a rough order of magnitude of revenue, operating and capital costs that could be involved to build and operate a lithium extraction plant for the Wairakei reservoir. The analysis is simplified by keeping lithium at current (historically high) prices and assuming that the concentration of lithium does not reduce over time from the geothermal reservoir. In the idealised (but unrealistic) single plant/full throughput model, an initial capital expenditure of USD80m could at current historic prices generate of order USD6m profit p.a. ignoring the costs of money associated with the plant build costs. In the more realistic multiple plant/80% reduction in throughput scenario, achieving an operating profit is highly unlikely (though this has not been modelled). The single plant/full throughout (best case) model suggests a best case raw production cost of ~USD4,000/ton of LCE, similar to the cost of mining lithium but more than double the cost of extraction from the salar brines which currently dominate world lithium production (60%). Based on this initial analysis, extracting lithium from Wairakei brine using ED appears to be economically marginal, even with historically high lithium prices. More detailed analysis of the potential differences (and impact on O&M and capital costs) of water treatment EDR against the proposed lithium ED process may change these economics but it is the view of the author that the costs of production are unlikely to reduce by the 40-60% required to sustainably compete with salar brine cost of production. It is suggested that any future investigation focusses beyond single high value minerals in brines. It is likely that a series of multiple revenue streams from multiple high-value minerals as well as cost reductions for power plants (e.g. silica removal for reinjection) will be required for the economics of large processing plants to be commercially viable and justify the capital outlay required. 11

12 13 APPENDIX I CARLTON SCHEMATIC SHOWING EDR STAGE Sarasota Carlton WTF schematic [21] above is shown for reference, total dissolved solids (TDS), mainly sulphate, is ppm 12

13 14 APPENDIX II - DESIGN OF ABRERA DWTP - ELECTRODIALYSIS REVERSAL (EDR) STAGE Maximum flow treatment: 2.3 m 3 /s (58 MGD) Range conductivity inlet water: µs/cm. Temperature range inlet water: 5-29 ºC Pump station : 9+3 pumps of 1030m 3 /h to 60 mca Cartridge filters: 18 filters with 170 cartridges each of 50 inches and 5 µm 9 modules with 576 stacks with 600 cell pairs each one, in double stage Homogeneous membranes: AR204 (anionic) and CR67 (cationic) Wet technology Voltage range: V 1 st stage, V 2 nd stage Bromides reduction: 60-80% Conductivity reduction: 60-80% Maximum volume of brines: 154 Tm/d, sent via a pipeline to the sea at the mouth of the Llobregat River Water recovery > 90% (including off-spec and concentrate recycle) Remineralisation (when necessary) with Ca(OH) 2 up to 7 Tm/d and CO 2 Source: Electrodialysis_technology_theory_and_applications.pdf 13

14 15 WORKS CITED [1] L. Christoffersen, A Strategic Metal for Green Technology: The Geologic Occurence and Global Life Cycle of Lithium, [2] Lithium Americas, Lithium Info, Lithium Americas, [Online]. Available: [Accessed 19 August 2014]. [3] K. Korosec, For Tesla's Gigafactory, a dash of brinkmanship, 6 May [Online]. Available: [Accessed 19 August 2014]. [4] R. Mills, Lithium ABC's, A Head Of The Herd.com, [Online]. Available: [Accessed 19 August 2014]. [5] 360ip Pte Ltd, Novel Process for Lithium Extraction from Salt Brine Lake, [Online]. Available: [Accessed 19 August 2014]. [6] Signumbox, Lithium Industry: Outlook and Perspectives, [Online]. Available: 12.pdf. [Accessed 19 August 2014]. [7] Wikipedia, Wikipedia, [Online]. Available: [8] New World Research Corp., Project:Lithium Facts, [Online]. Available: [Accessed 19 August 2014]. [9] R. Mills, Lithium Commodity Investing ABC, The Market Oracle, 24 March [Online]. Available: [Accessed 19 August 2014]. [10] EV World.com, Lithium Battery Recycling Expected to Reach $2B By 2022, 2 March [Online]. Available: [Accessed 19 August 2014]. [11] D. Brown, Lithium: World Class Deposit, Lithium Investing News, [Online]. Available: [Accessed 20 August 2014]. [12] L. Henthorne, The Current State of Desalination, IDA World Congress - Global Water Intelligence, Dubai, [13] Anon, Desalination, Wikipediaa, [Online]. Available: [Accessed 19 August 2014]. 14

15 [14] Anon, Electrodialysis, Wikipedia, [Online]. Available: [Accessed 19 August 2014]. [15] K. L. Brown and L. G. Bacon, Manufacture of silica sols from separated geothermal water, in Proceedings World Geothermal Congress 2000, Kyushu - Tohoku, Japan, June 10, [16] M. J. O'Sullivan, D. P. Bullivant, S. E. Follows and W. I. Mannington, Modelling of the Wairakei - Tauhara Geothermal System, [17] Western Lithium WLC, Minerals For a Green Society: The Role of Lithium, 4 February [Online]. Available: [Accessed 20 August 2014]. [18] The Lithium Site:Market, [Online]. Available: [Accessed 20 August 2014]. [19] Y. J. Chang, Waterscapes: A technical Publication by the water group of HDR, HRD, Inc, Spring [20] G. Williams and R. S. Trusell, Perfromance and cost comparison between MF/RO and EDR membranes for reducing recycled water salinity, September [Online]. Available: [Accessed 20 Sugust 2014]. [21] Sarasota County, Water Supply Master Plan Update: Technical Memorandum 2 - Water Treatment Assets, August [Online]. Available: [Accessed 20 August 2014]. [22] F. Valero, A. Barcelo and R. Abros, Electrodialysis Technology - Theory and Applications, in Desalination, Trends and Technologies,