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XThe Lithium Race Takes Shape in the Salton Sea
David Shultz
David Shultz reports on clean technology and electric vehicles, among other industries, for dot.LA. His writing has appeared in The Atlantic, Outside, Nautilus and many other publications.
Located roughly a hundred miles east of San Diego, the Salton Sea is California’s largest landlocked body of water, for now.
Measuring 5 miles across and 35 miles long in its current form, the lake was created by diverting water from the Colorado River into the region for agricultural purposes. Once a vacation destination renowned for its wildlife and wetlands, a series of environmental mishaps and mismanagement have left the lake toxically salty, shrinking and often malodorous. Conditions have gotten so bad that Palm Springs Life Magazine called the region’s transformation “the biggest environmental disaster in California history” in March of 2020.
But against this unlikely backdrop, new life—or at least new industry—is scrambling to set up shop in the region. The Salton Sea, it turns out, is rich with lithium, an element that has taken center stage in the world’s transition to clean energy and its ever-growing demand for batteries. From smartphones to electric vehicles, there’s a pretty good chance that the last battery you used had lithium ions inside. Prices for the metal reached an all time high in September, and futures are up more than 400% since the start of 2021. With Biden’s new economic policy outlined in the Inflation Reduction Act, there are strong financial incentives to move battery production back to North America.
If that’s going to happen the Salton Sea could very well become the lithium capital of North America, or to paraphrase Governor Gavin Newsom, the region could become the “Saudi Arabia of lithium,” and the players are already starting to assemble.
Currently, there are three companies attempting to set up plants in the Salton Sea for direct lithium extraction: EnergySource Minerals, Controlled Thermal Resources and BHE Renewables, a branch of Berkshire Hathaway. All three companies have similar business strategies from a high level, all of which involve geothermal power plants. These plants, which are common in many parts of the world, draw hot, salty water from deep in the ground to create steam which drives a turbine to produce electricity. What makes the Salton Sea so special is that its geothermal brines just happen to contain lithium.
In a 2017 study, researchers from the U.S. DOE Office of Energy Efficiency and Renewable Energy analyzed more than 2,000 samples of geothermal fluid from U.S. sources and found that only 1% had significant lithium concentration. This rare confluence of geothermal activity and lithium presence provides an opportunity for companies to generate electricity and mine lithium simultaneously.
Beyond their marriage of geothermal energy and lithium extraction, the three companies begin to diverge.
According to former dot.LA engagement editor Luis Gomez — whose newsletter Lithium Valle, is essential reading on this topic — EnergySource seems to be out in front early.
“They claim to have the technology that’s patented, they claim to have done the research, they claim to have the funding, and they claim they're ready to go and start production,” says Gomez. “They are kind of considered the canary in the coal mine.”
According to a report from the United States Department of Energy, EnergySource plans to eventually scale production up to over 20,000 metric tons of lithium hydroxide per year using its proprietary Integrated Lithium Adsorption Desorption technology.
Construction on the plant was slated to start earlier this year, but has been delayed. EnergySource has said publicly that lithium production might begin in the second quarter of 2024, but it’s unclear whether this date will also be pushed back. The company has a long history of operating in the region, having run the John L. Featherstone geothermal plant since 2012. The new venture into lithium would leverage that same plant, but without more details about how their proprietary technology works, there’s not much to do but wait and see.
One potential problem facing all three lithium extraction companies is that the Salton Sea geothermal brines are not the same as the brines in evaporation ponds similar to those in Argentina, Chile and Bolivia, where more than half of the world’s lithium is produced. Specifically, the deep geothermal brines in the Salton Sea contain more silica and transition elements, which may complicate the chemistry of purifying the lithium. Still, many researchers are extremely bullish on the prospect of tapping into these reserves. Alex Grant, The Principal at Jade Cove, a research organization focusing on direct lithium extraction technologies, says that much of the skepticism surrounding the technology can be attributed to competing financial interests that are trying to squash the nascent tech’s potential in favor of an established method.
Lithium Mines in the Atacama Salt Flats, Chile from an altitude of 15km via Google Earth. The facility is about 10km wide.
Google Earth
For its part, BHE Renewables, operating as CalEnergy, runs a fleet of 10 geothermal plants in the Imperial Valley. The company had previously announced its intent to set up a direct lithium extraction demonstration plant sometime before the end of 2022 to assess the viability of lithium extraction. If that pilot program goes well, the company could build a commercial-scale facility as early as 2026 with a projected annual capacity of 90,000 metric tons of lithium.
Obviously, having the backing of Berkshire Hathaway comes with advantages and capital. Add into the equation another $15 million in DoE grant money obtained last winter, and BHE appears to be well positioned as a major player in the long term.
Finally, there’s Controlled Thermal Resources. As the only company not already operating a geothermal business in the region, CTR is something of an outsider and dark horse. By 2024, the company hopes to build both a geothermal energy plant and a direct lithium extraction plant to operate in parallel, projecting a capacity to extract 300,000 metric tons of lithium carbonate equivalent annually by 2030. As dot.LA previously reported, Controlled Thermal Resources has partnered with Statevolt, a company that intends to build a $4 billion gigafactory nearby that will run on power from CTR’s geothermal plant and make batteries from the lithium it extracts. It’s a beautiful closed-loop business model. But again, all of this relies on the direct lithium extraction technology, and details are scant.
According to Gomez, despite the typically cut-throat nature of the energy industry, the relationship between the three upstarts in the Salton Sea is often surprisingly cooperative at the moment.
“They want the others to succeed because it kind of gives them the confidence that their technology is also eventually going to succeed,” he says. “It gives confidence to investors.”
Which is all to say, there may well be space for all three companies if the technology is as solid as they claim. If that’s the case, the Salton Sea and its surrounding region may have yet another miraculous transformation up its sleeve.
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David Shultz
David Shultz reports on clean technology and electric vehicles, among other industries, for dot.LA. His writing has appeared in The Atlantic, Outside, Nautilus and many other publications.
Billion-Dollar Milestones and Snapchat’s New Features
11:30 AM | October 25, 2024
🔦 Spotlight
Happy Friday Los Angeles!
This week’s spotlight showcases LA’s thriving tech scene, featuring Snapchat’s latest feature updates and two local startups Liquid Death and Altruist, making TechCrunch’s Unicorn List for 2024.
Image Source: Snap
Snapchat’s recent fall updates bring fresh features, including a new iPhone camera shortcut for instant snaps, Halloween-inspired AI-powered Lenses, and Bitmoji costumes inspired by Mean Girls and Yellowstone. Bitmoji stickers now reflect trending Gen-Z expressions like “slay” and heart symbols for added flair in chats. Plus, the “Footsteps” feature on Snap Map allows users to track their past adventures privately, adding a nostalgic touch.
Image Source: Liquid Death
ICYMI, two LA startups joined the Unicorn Club—achieving valuations over $1 billion. Liquid Death, based in Santa Monica, is a canned water company with edgy branding and a humorous sustainability focus. Known for viral marketing and brand partnerships, it redefines bottled water as a lifestyle brand and environmental statement. In March, Liquid Death closed $67 million in strategic financing, raising its total funding to over $267 million and valuing it at $1.4 billion.
Image Source: Altruist
Altruist, a Culver City-based fintech platform, offers financial advisors streamlined tools to better serve their clients. With a user-friendly investment and account management platform, Altruist has gained strong traction in the finance world. In May, it announced a $169 million Series E funding round, bringing its total funding to over $449 million and earning a valuation of $1.5 billion.
Together, Liquid Death and Altruist exemplify LA’s capacity for innovation across diverse sectors, from lifestyle branding to fintech. Whether reshaping financial tools or redefining sustainable branding, these companies showcase LA’s unique entrepreneurial spirit. Go LA!
Check out TechCrunch’s 2024 Unicorn List here. And don’t miss Snapchat’s latest features—perfect for adding some fun, connection and maybe a few selfies this weekend!
🤝 Venture Deals
LA Companies
- Carbon Ridge, a developer of carbon capture technology for the maritime industry to reduce ship emissions, has raised $9.5M in a funding round led by Crosscut Ventures and Western Technology Investment (WTI). This investment will help accelerate the decarbonization of maritime shipping. - learn more
- Freeform, a company bringing AI to metal 3D printing, raised $14M in funding from NVIDIA’s NVentures and AE Ventures to further develop its AI-powered 3D printing technology for industrial-scale production. - learn more
LA Venture Funds
- Anthos Capital participated in a $70M Series D round for Carbon Robotics, which develops AI-powered robotics for precision agriculture, and the funding will be used to accelerate the growth of its autonomous weeding technology. - learn more
- Anthos Capital participated in a $3.5M seed round for Plasma Network, aimed at expanding access to USDT stablecoins on the Bitcoin network, with the investment supporting the network’s growth and efforts to enhance stablecoin accessibility through the Lightning Network. - learn more
LA Exits
- Grandview, a literary management company representing top talent across various entertainment sectors, has been acquired by TPG’s newly formed entertainment venture, Initial Group, in partnership with Untitled Entertainment. - learn more
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Big Wins: Dodgers Take the Title ⚾, ChatGPT Levels Up🚀
06:54 AM | November 01, 2024
🔦 Spotlight
Happy Friday, LA! It’s been a week of big wins, on and off the field. 🎉
⚾️ First up, let’s talk Dodgers. With a thrilling 7-6 comeback victory over the Yankees in Game 5, the Dodgers clinched their eighth World Series title, their first since 2020. The city is buzzing, and fans are ready to celebrate! A parade kicks off this morning at 11 a.m., starting at City Hall and winding down to Flower Street, with a ticketed celebration at Dodger Stadium for those wanting to keep the festivities going.
Image Source: Dodgers
💻 Meanwhile, in the tech, OpenAI just rolled out a game-changing update for ChatGPT. Plus and Enterprise users can now access real-time internet search, powered by Microsoft Bing, bringing ChatGPT's responses fully up-to-date. This means users can now ask about the latest news, hotspots, or recent LA startup announcements, and ChatGPT will pull in fresh, relevant answers directly from the web. Previously limited to information up to 2021, ChatGPT’s new browsing capabilities make it a valuable digital assistant for anyone needing real-time insights in fast-paced industries like tech and entertainment.
Image Source: ChatGPT
🔍 The real-time search feature also includes “Browse with Bing,” allowing ChatGPT to source information from multiple sites for detailed answers to complex questions. Whether you’re exploring the latest venture capital trends in LA or curious about the best local spots, ChatGPT’s new browsing power helps you stay ahead with the latest info. This leap forward in AI functionality makes ChatGPT even more versatile and powerful for everyone, from business owners to everyday users.
From the Dodgers’ World Series win to OpenAI’s latest ChatGPT update, there’s a lot to celebrate in LA this week. Here’s to champions, innovation, and a city that’s always pushing boundaries. 🌆✨
🤝 Venture Deals
LA Companies
- Final Boss Sour, a Los Angeles-based gaming-themed snack company specializing in healthier sour snacks, has raised a $3M Seed funding round led by Science Inc. to expand its product offerings and operational capabilities. - learn more
LA Venture Funds
- Smash Capital led a $50M Series B round for Read AI, a productivity-focused AI company, bringing its total funding to $81M. The company offers a platform that enhances meeting efficiency through features like note-taking, summarization, and transcription. Additionally, Read AI introduced "Read AI for Gmail," a free Chrome extension that integrates information from various applications, reducing the need to switch between apps. The funds will be used to increase the company's headcount in engineering, data science, and business teams. - learn more
- Distributed Global participated in a $25M funding round for Nillion, a company that provides decentralized privacy solutions designed to secure sensitive data using advanced technologies like secure multi-party computation. - learn more
- Alexandria Venture Investments and Tachyon Ventures participated in a $115M Series A funding round for Axonis Therapeutics, a Boston-based biotechnology company developing innovative medicines targeting KCC2, a key mediator of brain inhibition, to treat neurological disorders. - learn more
- Act One Ventures participated in a $5M Seed funding round for Latii, a construction materials supply chain startup, to enhance its platform that connects contractors with suppliers, aiming to streamline procurement processes and reduce costs in the construction industry. - learn more
- F4 Fund participated in a $3M Seed funding round for Final Boss Sour, a Los Angeles-based gaming-themed snack company specializing in healthier sour snacks. - learn more
- SmartGateVC participated in a pre-seed funding round for Ritual Dental, a company revolutionizing dental care by integrating advanced technology and microbiome science to provide personalized, preventive treatments. - learn more
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