Will we run out of Lithium?

Daniel Shaposhnikov
Phystech Ventures
Published in
9 min readApr 3, 2022


Lithium consumption continues to increase every year. In 2022, there is demand for 641,000 metric tonnes of lithium carbonate a year, nearly double that of 2020 (342,000 metric tonnes). This is the result of several factors. Firstly, this metal is used in a variety of industries, from porcelain to lithium-ion batteries, though it is particularly essential for the production of gadgets and electric vehicles. The second and even more important factor is scarcity, as a 2019 estimate of global proven lithium reserves placed the total figure at around 17 million tons.

The price per ton of lithium carbonate increased almost 7 times since the beginning of 2021, and almost doubled since the beginning of this year.

Worldwide cost of lithium mining per metric tonne.

By 2023 demand is expected to surpass 821,000 tonnes. Assuming that after 2023 lithium consumption will only grow by 30% a year, there will be enough reserves until 2030.

This increasing demand for lithium is growing concurrently with the rising popularity of electric vehicles, which require batteries. In fact, about 40% of all mined metal today is used to create batteries.

The top five lithium battery manufacturers are:

  • Albemarle (USA)
  • Ganfeng Lithium (China)
  • SQM (Chili)
  • Tianqi Lithium (China)
  • Livent (USA)

How is lithium mined?

Lithium is a reactive metal, so how it is mined is differs slightly from other metals. Two methods exist for natural resources: pegmatite minerals and clays of solonchaks (saline solutions).

Mining from minerals and further ore processing (grinding and enrichment) were originally the main source of mining lithium. However, this method bears greater environmental risks and is not as economically viable as mining from saline solutions. Such financial concerns were confirmed during the coronavirus pandemic, as falling lithium prices led to the closure of Whabouchi, the major ore project in Canada. This was also despite the fact that the project planned to reach more than a billion dollars in project investments. Good article in Elsevier for an immersion in technology >>

Lithium containing ore

The second mining method, from saline solutions, is more profitable, but also has several notable limitations. To isolate lithium from clays, multi-stage and long-term production, and large areas and volumes of water are required. This is because, conditionally, the metal is “evaporated” from saline solutions. On average, this process is reasonable, though it does last for 18–24 months. Good article for an immersion in technology >>

Saline solutions

Another limitation is that lithium obtained from saline solutions often comes with impurities of iron and magnesium. Though it is possible to dispose of them, this also increases the cost of production. In addition, rich deposits (high in lithium and low in impurities) are limited, and very unevenly distributed worldwide, with a heavy concentration in South America.

Alternative methods

Difficulties with lithium mining from natural resources have stimulated the development of non-traditional technologies, i.e., laboratory ones. For example, attempts are currently being made to obtain lithium from saline solution using metal-organic framework membranes (MOF), as in living cells. Scientists propose to copy the mechanism of living cell filtering to identify lithium ions in saline solutions, i.e., ion selectivity. The 2003 Nobel Prize in Chemistry was awarded for the study of these channels in the cell membrane.

Using MOF, scientists propose that vast reserves of lithium can be accessed through filtering sea water. Fresh water, a by-product of the filtering process , is also drinkable. This means that, under this method, we can simultaneously obtain several valuable resources. These technologies are therefore highly promising, though are so far too expensive for widespread adoption.

The lithium reserves in sea water substantially exceed the known lithium lithospheric reserves, which turn them into an important long-term source. Therefore, attempts are being made to obtain the metal present in water by other methods. Developments in the field of lithium sorption mining have consequently been made over the last ten years. As a result of these developments, at this point, groundwater, including associated oil water, can be seen as a raw material. Japan and Korea, not possessing their own lithium deposits, are consequently investing in such projects.

Today, sorbent selectivity makes it possible to concentrate and obtain lithium even under the existence of independent elements, and new technologies (reverse osmosis, electrodialysis) are helping miners switch from traditional to intensive technologies in lithium solution processing (including sea water). Combining technologies (e.g., electrosorption, lithium selective membranes) will ultimately help improve process efficiency by reducing costs and increasing competitiveness.

Attempts to combine membrane technology and sorption can be seen as an experimental technology. By incorporating a sorbent into a polymeric membrane, we can create a membrane that is selective only for lithium. In simple terms, this would enable the extraction of lithium solutions without impurities. However, the problem of sorbent solubility is still not solved.

The main advantage of sea water is its availability, as it could eliminate the need for deep wells. Conversely, its major disadvantage is the high content of independent minerals and the low content of lithium in sea water (a thousand times lower than in current projects). Additionally, evaporating the large volumes of water necessary would not be economically feasible, even when using the latest technologies.

The use of a sorption column filled with a sorbent also leads to an increase in the process cost, due to the additional equipment and energy required. Another problem is the mechanical sorbent chafing during friction. The use of magnetic sorption particles is therefore an attempt to simplify the process. Sorption is performed by spraying sorption particles in the solution, then capturing particles using a magnetic field. This allows for the use of nanometric particles that accelerate the sorption process, and does not require high pressures.

Another method of lithium mining that does not use ores, clays, or water, is the deep processing of lithium batteries. For example, the main products for the Chinese company Jin Kunlun Lithium Industry are lithium metal and lithium chloride. Although the demand for such lithium forms is not as large as for the common carbonate, the use of recycled lithium from batteries could provide a significant increase in energy density. Scientific work has demonstrated the energy density of lithium metal batteries up to 560 Wh/kg.

Who is engaged in the lithium mining research?

According to our analysis, about a hundred companies in Australia, Canada, Germany, the USA, Japan, and China are currently conducting laboratory research on lithium mining.

These research companies can be divided into the several following groups:

Large corporations that have been mining for a long time. A suitable example would be the Korean company POSCO, which has historically focused on the production of steel. Extensive experience in field development, the availability of initial capital and business diversification allow the company to actively develop its lithium manufacturing capabilities and successfully overcome local challenges. Another notable company in this group is Albemarle, the largest global lithium producer.

The next group consists of the companies for which lithium is not a core business.

This includes large corporations that use lithium products in their core business, such as manufacturers of electric vehicles (Chinese company BYD) and electronics (Korean company LG). One of the factors to pay attention to for such a remote task is the lithium market price. For example, in 2018, it reached $17,000 per ton of carbonate equivalent, which is several times higher than its production cost. For certain companies, mining lithium themselves is therefore a good way to try and save money.

Numerous new companies are emerging with lithium mining as their only business, in connection with the rapid development of the lithium industry. As often happens, the price reality of mining has cooled an excess of enthusiasm. In 2021, lithium prices reached their minimum, and, in fact, approached the production cost, with a price of $4,000. Despite this, it is obvious that the price will inevitably go up as the demand is projected to grow. However, due to their age, it is not easy for many companies in this group to overcome difficulties, especially when it is currently important for them to expand production to simply maintain their market share.

Companies only planning to launch production. Perhaps the most prominent example today is Piedmont Lithium. This originally small company from Australia signed a contract with Tesla for the supply of lithium concentrate. At the same time, only preparatory work is underway. The characteristics of such companies include high expectations, expressed in constantly rising share prices. From the investor’s point of view, this means that growth is already accounted for in the current assets price. In the case of Piedmont Lithium, the company’s shares rose by 236% following the securing of the agreement. Although the demand for future products can be considered secured, there is always a risk of failure, as in the case of the previously mentioned Canadian Whabouchi project.


By 2022, many nations and companies will realize that lithium is a strategic resource with an exhaustible method of mining from ores. This will force developed countries to provide themselves with their own sources of lithium.

Although a substantial amount of lithium is mined in Chile and Argentina, the mining companies operating there are owned by foreign investors, and research in this area is conducted worldwide. In recent years, new investment directions have also emerged, particularly in South Africa. For now, manufacturing with the prospects for expansion already exists in Zimbabwe. Additionally, the nearby Democratic Republic of Congo does not have full-fledged manufacturing yet but is attracting investors, due to its vast reserves of lithium-containing ore.

The ongoing laboratory studies have to a great extent been effective thus far, but have not yet been “tested” for economic feasibility. Selective lithium mining with organic solvents has been known about for a long time, but despite numerous studies, this process has not yet been able to apply for industrial implementation. The main problem is the solubility of reagents in water, and the lower the lithium concentration (it decreases when switching to groundwater and sea water), the higher the losses. It is therefore hardly worth expecting a breakthrough in this area.

As the lithium battery industry expands, the issue of recycling time-expired batteries becomes relevant. Currently existing technologies already make it possible to obtain lithium almost completely using this method. The Chinese are the undisputed leaders in this area, as the largest company, CATL, is able to process over 100 thousand tons of batteries by itself. Traditional technology involves the leaching of metals with acids, though new developments are aimed at replacing acids with a less aggressive environment, such as a carbonate solution.


The above factors make it clear that everything is not simple regarding lithium. I think many people are therefore wondering if there is a real alternative to lithium, in the context of rechargeable batteries. We have analyzed the market for electrochemical devices and found that the closest alternatives to lithium-based batteries are sodium-ion batteries.


  • Plenty of deposits, supplies are not limited, and because of this, it is also cheap to produce.
  • An ability to charge to 80% state of charge in just 15 minutes, Sodium-ion cells are also well-suited for use in passenger EV buses.


  • Low cyclability. Lithium batteries have a cyclic rate of up to 5,000 cycles (sometimes 8,000), which is equivalent to ~15 years of EV bus life. Conversely, sodium batteries have no more than 500 cycles so far.
  • Relatively low power density — up to 120–130 Wt*h/kg, whereas in lithium batteries, density reaches 200–250 Wt*h/kg.

As a result, Adamas Intelligence experts believe that, by 2035, sodium-ion batteries will account for no more than 15% of the global market.

Some experts believe that batteries are an intermediate stage before switching to hydrogen technology. You can read about this technological segment in my previous post.



Daniel Shaposhnikov
Phystech Ventures

Daniel is a Partner in Phystech Ventures. Hydrogen fuel cells pioneer in Eastern Europe. Venture capital professional focused on DeepTech, Robotics, Quantum, AI