Is Reno the next lithium capital? Companies are looking to Nevada for ‘white gold’
Inside an empty office building in downtown Reno, on a cool morning in December, Richard Morrison looked out across Virginia Street, which cuts across town. The office space is being developed for NeoLith, an offshoot of Schlumberger, a global oilfield services company.
But in Nevada, it’s not oil that the company is after.
Hundreds of miles away, in the Clayton Valley outside Tonopah, NeoLith is looking for lithium, a key ingredient needed to move away from combustible engines and toward electric vehicles. In this venture, its strategic partner is Panasonic Energy of North America, which operates out of the Gigafactory, what the company says is “the largest lithium-ion battery factory in the world.”
Morrison, who grew up in Reno and graduated from McQueen High School and then UNR, moved away from Nevada to work for Schlumberger in Texas, focusing mostly on oil projects. When an opportunity to work on a lithium project in his hometown arose, Morrison jumped on it.
“We need domestic sources of these critical minerals in order to have a successful energy transition,” he said in an interview earlier this year. “Right now, we get a vast majority of lithium outside of the U.S. In fact, there’s only one operating commercial mine currently. It’s important that we bring on new sources, and Nevada has one of the best resources in the nation.”
That operating commercial mine is in Nevada. In fact, it’s in Clayton Valley, the same area that NeoLith is exploring. The project, known as Silver Peak, is operated by global lithium company Albemarle. It spans thousands of acres, with prominent shiny blue ponds dotting the landscape.
Instead of blasting through the ground, the project pumps brine to the playa surface and lets it evaporate, capturing lithium from the leftover product. Brine mining is one of the conventional methods for extracting lithium, yet globally, it is often criticized for its water consumption and massive land footprint. That’s why Morrison’s company is exploring an alternative technology — Direct Lithium Extraction (DLE) — aimed at decreasing the impact on land and water use.
When it comes to DLE, Morrison said, “it’s definitely time for a technological revolution.”
Today, a variety of newcomers are looking to compete, many casting their lithium projects as more environmentally friendly than conventional methods with a large footprint. It’s important because end-users are increasingly placing a greater emphasis on a sustainable supply chain.
The International Energy Agency reported in May that the energy sector is quickly becoming a major driver of demand for minerals. The agency has said that by 2040, technologies used to move away from fossil fuels, including electric vehicles and large-scale batteries, could drive nearly 90 percent of the demand for lithium.
Right now, much of the lithium consumed in North America is mined and processed overseas. Most of our lithium supply comes from Australia, Chile and China, which also leads other countries in processing minerals considered critical for the energy transition. Officials from both political parties, including President Joe Biden, have emphasized creating a domestic supply chain to secure these minerals over the long-term.
NeoLith is not the only company setting up shop. Across western Nevada — in Reno, Fernley and Carson City — companies are buying warehouse space and constructing miniature chemistry labs. They are also poaching engineers and experts from the electric-vehicle world, the battery world, the oil and gas industry, Tesla and other mines across the West.
Nevada, this year, was ranked the most attractive province for mining in the world. And Nevada has ample federal public land, increasing the accessibility of ore deposits. Tesla’s presence in Northern Nevada makes the state all the more compelling. Over the past few years, at least two top Tesla employees have left to lead Nevada-based companies focused on lithium recovery.
That includes JB Straubel, a Tesla co-founder and its former chief technology officer. After he left the company, he started Redwood Materials, a Nevada-based company that has its sights on creating a circular supply chain for the minerals needed in the energy transition. In Carson City, Redwood has built a laboratory, a warehouse and recycling processing equipment as it continues to grow. Its goal: Rather than mine, recover minerals from America’s junk drawers.
“Increasing our nation’s production of batteries and their materials through domestic recycling can serve as a key enabler to improve the environmental footprint of U.S. manufacturing of lithium-ion batteries, decrease cost and, in turn, drive up domestic adoption of electric vehicles,” Straubel said in September after Redwood announced a strategic partnership with Ford Motors.
An emphasis on domestic supply
The lithium rush is not new, but it has accelerated in recent years as auto manufacturers and global economies have committed to producing all-electric vehicle fleets in the coming decades. Since 2015, Nevada mining officials have tracked claims thought to be associated with lithium brine. Because of how lithium mining claims are staked, they are sometimes difficult to track.
That said, the Nevada Division of Minerals estimates there are about 10,989 claims presumed for lithium brine. The division estimates there is a similar number of claims for hard-rock lithium mining. Hard-rock mining, unlike brine mining, involves digging underground to extract ore.
“It is something we have been tracking and trying to quantify,” said Mike Visher, the division’s administrator (the state agency plays a role in regulating certain types of lithium exploration).
The Center for Biological Diversity, which monitors the impact of development on wildlife and plants, created a map showing proposed lithium projects dotting much of rural Nevada.
“We’re in the midst of a ‘white gold rush’ the likes of which hasn’t been seen in 100 years — and we have no plan,” said Patrick Donnelly, the center’s state director and the map’s author.
Donnelly urged state officials to develop a plan with a technological and geographical analysis.
The emphasis placed on new mining, for some projects, has prompted significant concerns and scrutiny from environmentalists and rural communities that are no strangers to extraction. Some communities are reluctant about being on the frontlines of the global energy transition. This is especially true with efforts to permit hard-rock lithium projects and create new surface mines.
Much of this proposed mining activity would take place on the ancestral homelands of Western Shoshone, Northern Paiute, Southern Paiute and Washoe tribes. An estimated 79 percent of the country’s lithium reserves are within 35 miles of Native American reservations, according to research conducted by MSCI, a financial analysis firm that assesses sustainable investments.
Payal Sampat, a director at mining watchdog Earthworks, said new extraction, whether in the U.S. or globally, often amplifies inequities, “basically imposing harm on vulnerable communities that have neither caused the climate crisis nor are likely to benefit from this transition.”
Visher said it’s important that operators approach projects with “their eyes wide open.” It’s not only about finding ore. It’s also looking at the biological, cultural and social impacts of a project.
“You can choose to close your eyes to it and just focus on the commodity,” he said. “But if you do that, you risk losing…