(Also check my entire Lithium deep dive!)

with Cris Moreno – Deputy CEO at Vulcan Energy Resources

Vulcan aims to decarbonize the transition to electric mobility through its world-first Zero Carbon Lithium Projects for electric vehicle batteries and its renewable energy business.

Zero Carbon Lithium – Slider

What we covered:

How Vulcan aims to become the world’s first integrated lithium chemicals company while also producing renewable energy…

0⃣ … and how they do all of this with net zero greenhouse emissions and without using any fossil fuels in their process

How Vulcan’s Zero Carbon Lithium projects feature a 24’000 t/y first stage and what might be the next ones

How Vulcan leapfrogged its path by acquiring an existing geothermal power plant in Hinsheim, Germany

How the company tested various Direct Lithium Extraction (DLE) methodologies to end up developing a proprietary sorption process

How this sorption material belongs to the Dow / Dupont / FMC / Livent family, but with the added touch that it’s made in Europe

How Vulcan desorbs it with fresh water, and how water availability is one of the perks of producing in the Upper Rhine Valley

How the company plans an 84% EBITDA on its Zero Carbon Lithium product, despite a forecasted lithium price way below the current spot

How, to whom, and under which conditions Vulcan sold its Zero Carbon Lithium product to battery and car manufacturers years ahead of actually producing it

How 2023 shall be pivotal for Vulcan to transform from a development company into an actual production company

How the Company has €120 Million in its bank account… and actively looks to increase its financing in order to cover for the first phase of the project

How the Upper Rhine Valley is Europe’s largest lithium resource, and a globally relevant one and how CAPEX might be the only thing to slow it down to cover for the entirety of Europe’s lithium needs

How DLE combined with geothermal energy production might be seen as a complex mining project… or as a very easy oil and gas one!

Kicking off production in 2025, producing renewable power & heat, next projects in the Upper Rhine Valley – and on the French side, building the right team to execute the project, kicking off the commercial scale in Q3 2023… and much more!

… and of course, we concluded with the 𝙧𝙖𝙥𝙞𝙙 𝙛𝙞𝙧𝙚 𝙦𝙪𝙚𝙨𝙩𝙞𝙤𝙣𝙨  

Resources:

Come say hi to Cris on LinkedIn

Check Vulcan’s website

is on Linkedin

Antoine Walter on LinkedIn

Teaser

Introduction: Zero Carbon Lithium

This exploration of the Lithium World has taken me far from home. Canada, USA, Mexico, Australia, Argentina, Bolivia, UK… But one of the most exciting projects in this new wave actually happens to be a dozen kilometers away from where I cut my wastewater engineering teeth, and Vulcan, the project developer, just signed an off-take agreement with a car factory I can see if I climb up my village’s hill.

And this makes sense for a ton of reasons! First, the Rhine Valley used to be a Salt Flat, exactly like the Atacama Desert nowadays, and this was just 35 million years ago. So on the geological scale of things, it makes sense.

Then, it is a geothermal region, and Germany actively pushes to add more geothermal plants to its energy mix, which means thousands of cubic meters of water that are pumped from that lithium-rich aquifer anyways, which allows you to emulate the example we heard from Standard Lithium, piggy-backing on Lanxess’ Bromine business.

Europe builds Gigafactories: who will feed them Lithium?

But maybe most importantly, Europe is actively building about 30 battery gigafactories. And that’s a staple in the zero-carbon transition of mobility! But to feed those factories, Europe will need lithium at some point. Today, 97% of that lithium is imported from China. And with China’s own plans to further build up the battery value chain, they may well use all their lithium themselves, which would leave Europe without any white oil.

So Vulcan’s endeavors in the Upper Rhine Valley, today on the German side and anytime soon on the French side, would not only be one of the largest lithium projects in the World. But from 2026 on, it might also be Europe’s EV strategy lifeline – as long as I’m not fully up to speed with my own backyard project.

So what’s Vulcan’s plan to a – quote unquote – “Glorified Water Processing Facility” able to deliver 24’000 tons of lithium hydroxide in its first phase, but also 300 GWh of renewable power and 250 GWh of renewable heat? Cris will be our guide.

Full Transcript:

These are computer-generated, so expect some typos

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Antoine Walter: Hi Cris. Welcome to the show.

Cris Moreno: Thank you. nice to be here.

Antoine Walter: I’m excited to have that conversation with you for many reasons. So let me jump straight into it. You are here to represent a company I’m following for a while, which is called Vulcan. But for anyone which wouldn’t be familiar yet with what you’re doing, what would be your elevator pitch?

Cris Moreno: Vulcan is a unique company. We’re basically aiming to become the world’s first integrated lithium chemicals company and renewable energy producer. And we’re doing all this with net zero greenhouse emissions and not using any fossil fuels in our process. So that’s what we’re aiming to be.

Antoine Walter: What would be your definition of integrated?

Cris Moreno: I mean, integrated as a term we use to say that , in the same process. As we drill into our reservoir down in the upper Rhine Valley, we can use the heat that’s generated from our geothermal resource the brine that’s in the ground. We use that heat to basically create renewable energy, green energy for heating of communities and for people’s homes producing green power that can be used obviously to power our lives, but the same heat can also be used and the same power can help to generate and process our lithium.

And this lithium is actually contained in that same brine. So this green energy actually drives the processing of that lithium. So we don’t need any fossil fuels and we have all the energy we need to actually create our lithium hydroxide monohydrate, which is what goes into batteries that you need for cars and hopefully in the future, planes and trains and everything else.

Antoine Walter: mentioned this lithium hydroxide monohydrates your definite visibility study is just out, and if I’m not mistaken, you will project to produce 24,000 tons of that lithium hydroxide. There are also. Many other perks and big numbers in that dfs. Pretty impressive. If I had just to take out three key facts about your project, what would it be?

Cris Moreno: there’s lots of numbers in my head, but I’ll give you, I’ll give you three. The one that you said at the beginning was important. So our phase one is targeting 24,000 tons of lithium hydroxide monohydrate as a product that’s already been sold to our customers. So that’s one.

We are also targeting to produce 300 gigawatt hours. Of renewable power and 250 gigawatt hours of renewable heat each year. For our communities. And probably the last number that we can probably talk about now is we’re trying to do this at speed and hopefully by the end of 2025, we’ll have all of this in production.

We’ll up through 2026, but our target at the moment is to be in production with our renewable heat renewable energy and our lithium by the end of 2025.

Antoine Walter: For that exploration of the lithium world. I’ve been talking with companies at different phases of the development of their projects, and some were just starting out and having a PowerPoint and a great idea. You are far beyond that point. If I’m right, you’re running a pilot now for a while. How long are you running that pilot and what did you learn on the go?

Cris Moreno: that’s a really good point. I mean, we’ve been operating our pilot for two years now. We were strategically well positioned a few years ago to actually buy an existing geothermal power plant in a place called Hinsheim down in the upper Rhine and. Once we brought that power plant, we were able to actually connect live to that, live well.

Our pilot plants, these pilot plants have given us a lot of valuable data. And we’ve been able to use that data and refine that process in our main design for our big commercial plants. It’s pretty typical. in these type of projects where have it like a geophys type chemistry. So by having this data, we’ve been able to optimize our commercial design with this data. and it’s given us a lot of confidence as we’ve tried different absorbance and we’ll probably come onto absorbance soon. The main heart of the technology is this adsorbent or absorbent, as we call it, technology.

We’ve been able to try different absorbance to really understand what is the most optimal absorbent in our process, and what are those parameters that really absorb. And extract as much lithium as possible. On that topic, we’ve, because of this pilot plant, we’ve actually been able to design and develop our own absorbent, which is really important actually, because currently inside Europe, there is no absorbent production.

In fact, most of the absorbent production comes from China or Russia. And you know, we are trying to be a company, European company where we’re, you know, the. The sources in Europe, we want to produce that heat for Europe and we wanna produce that lithium for Europe. But if we’re starting to rely on supply chains that are outside of Europe, particularly in China and Russia, then we’re at risk.

So what we’ve been able to do the last few years, predominantly through our expertise with our chief technology officer, Dr. Steven Harrison, is actually developed our own absorbent now this absorbent. Is pretty much the same. Family of absorbance has been around since the sixties when Dow actually developed this.

And in the nineties was actually commercially made available by a company called FMC now Livent. So it’s actually been in production since 1996, so it’s commercially proven this sorbent, but it’s always good to use a pilot plant to really design out these process parameters. So we’ve been lucky.

We’ve got two years of data underneath us.

Antoine Walter: So that’s, so which you’re using is, it’s one which you backwash with water, or one which you backwash with acid. I’m just trying to put it for the muggles here.

Cris Moreno: Yeah, no, awesome questions. So there’s an umbrella term called DLE, direct Lithium extraction. Unfortunately it captures a lot of different chemical, physical type extraction methodologies. One’s called direct lithium extraction is called absorption. Absorption.

There’s other ones called solvent extraction, and then there’s ion exchange. Now, the absorption one that we’re doing, we can. adsorb the lithium onto our little beads that we’ve got, which is the absorbent beads, and we are able to then desorb with fresh water. So it’s, very I guess friendly.

We’re not using harsh chemicals which also have their own issues, not just a cost issue, but a carbon issue because it’s not easy to make these chemicals, these acids and bases. So we can desorb with fresh water. And what that means is that we can recover the lithium in this fresh water.

And what we do is use the heat from the geothermal brine to basically concentrate up that lithium into lithium chloride. And that’s actually what we send up to our electrolysis plant up in Höchst in Frankfurt to basically use electrolysis technology to convert the lithium chloride into lithium hydroxide.

Now some of the other DLE technologies like solvent extraction and ion exchange, they use heavy amounts of chemical and base. It’s always about precipitation and trying to get the pH right. So we got none of that. So it’s a super friendly process in that respect.

Antoine Walter: According to your dfs, you will be able to produce lithium at 4,539. That’s very precise. Euro perton. Today’s lithium spot price is hovering around 70,000 euros. Perton, does that mean you’re printing a lot of money?

Cris Moreno: I think what it means is that we’ve got a really robust business case. And I think a lot of people are printing money at the moment. That’s the advantage of those producers at the moment. But I think what it means is that, you know, we don’t foresee that price forecast staying around 70.

I think that’s, Probably a little bit unhealthy actually.  We’ve got a much lower forecast. We’re also lucky we’ve already sold the first five years and in some cases 10 years of our production to some of the largest manufacturers of Battery Valley chain. So we’ve. Volkswagen with Unior, with LG Chem, Stellantis and Renault.

So whether it’s a cathode manufacturer or a car manufacturer, or a battery manufacturer. So we’ve basically fixed in some of those prices and we’ve got some that are floating and we’ve got some that are a basket of those. So we feel very comfortable with our, as you said, 4,000 plus um, type production costs.

We’re gonna be really robust no matter what happens in the future compared to some of the other projects which can hover between 8,000 and 15,000 a ton. So it starts to become a bit more scarier when the price starts to drop.

Antoine Walter: You mentioned this offtake agreements you have with these large car manufacturers. Again, for the mug. Which is me in that room. How does that work? What do they exactly buy? The lithium in the future, the promise of the lithium in the future, A piece of paper. How, How is it?

Cris Moreno: Yeah, so these are binding offtake agreements, which is important. So, they’re not non-binding, so they have secured the lithium. They’re aware of our development timeline. So we’ve said that we would be producing lithium by the end of 25 and ramping up through 26. secured the lithium that we start producing in that year, in 2026.

Now, Also with these manufacturers, they’ve got like a validation period. Because what happens is when they take the lithium, they can’t just straight away put it into a cathode or into a battery. So they typically take, six to 12 months of validation where they take our lithium test it, make sure it’s good, they optimize their battery or their cathode a little bit, and then they’ll take their full production or full quota from their KN board.

So, so it is a binding agreement. It’s a paper today, but that’s secured the production in the future. And. Hopefully we’ll continue to see more and more of those contracts as we start producing. And obviously yeah, we’re looking to expand to more and more companies once we start producing phase one.

But then phase two and future phases,

Antoine Walter: So phase one is these 24 kilotons a year. Phase two as similar in size or what’s your long term vision? How much can you produce on the long run?

Cris Moreno: Yeah, I mean, this is a really important point because what we did during the dfs, we actually announced an update in our resource. Now currently in the Uper Rhine Valley we have 15 licenses, either exploration or production licenses. And we basically did the dfs really around the first five licenses because we’ve already got two, we’ve got this producing.

Geothermal plant already at enzyme, and we’ve got another joint venture and offtake brine offtake in Landau. So we’re very confident in this central part of the core of the field. But for phase one, we’re basically looking at five licenses. And those five licenses account for around 5 million tons of lithium carbonate equivalent.

But our actual lithium resource across all of our licenses actually equates more towards 26, 26.5 in terms of lithium carbonate equivalent. So what that means is for phase one, 24,000 tons of lithium hydroxy monohydrate, you know, we can see a phase two, phase three. Phase four, maybe even phase five to be honest, we’re trying to look at phase one.

And then once we’ve designed phase one, it’s like a cookie cutter. We design phase one, it’s a cookie cutter. We take it to the next one so we can expand as and when the market needs it or all our customers need it. how we’re looking to expand, you know, with the market growing.

Antoine Walter: you mentioned how you start producing in 2026. What’s your roadmap towards stats? What do you have to do and what are this? In between steps, which tell you you’re on track.

Cris Moreno: that’s where we are as a company at the moment. We’ve been this really awesome , development company the last four, four and a half years. So that’s got us to this point. 2023 is like a transition or transformation year where we transform from a development company into an execution and production company.

So for us this year, we’ve got a number of key milestones. Some of them are about we’re building these larger commercial demonstration plants. We talked about the pilot plants previously, but we’re actually building these larger demonstration plants right next to the existing pile of plants actually.

And so they’re looking to be complete around middle of this year. They’re really important because they’ll be used to train our operations team in like a pre-commercial setting. We’ll also be able to like tinker with some like process parameters and become really comfortable with the equipment. So we’ve got those demo plants being built this year which will also produce lithium chloride and lithium hydroxide.

We will also then start to move into real hardcore, like execution stuff. Like we’ll be awarding major long lead items of equipment. So we’re buying big crystallizers and we’re buying electrolysis units and things like that. It’s important right now because the supply chain around the world is quite stretched.

So it’s important that we order these, but we’ll also start to then really award our big EPC like engineering, procurement, construction contracts or EPCMs, engineering, procurement, construction management contracts. can’t do this on our own. We need lots of partners. So this is about securing those partners towards the second half of this year because during 2024 and 2025, we’ll do the hard stuff.

We’ll be engineering, we’ll be buying, we’ll be building the plants and installing the pipelines and drilling the wells. And we’ll also start drilling at the end of this year. So we’ve actually purchased two rigs within the Vulcan group. Strategically. I think that was actually a really important part of securing our future.

You think about what’s happening in Germany right now and we’ve had the, our chancellor announce there’s gonna be another a hundred geothermal projects before the end of the decade which is quite amazing. That shows how the energy mix is really going to change within, within Germany and so, It should be when we’re reliant on other exports from Russia and other things.

We’ve got multiple execution type activities ongoing. We’re still getting some permits. We’re doing a lot of our drilling, we’re doing execution and setting ourselves up for the remainder of the execution phase.

Antoine Walter: you mentioned the partners you will need for the execution. Do you already have some which are lined up or is it. It’s all prepared to be tendered and to be decided later this year.

Cris Moreno: it’s a mixture actually. So for some of the technology we’re very confident working with one or two suppliers. They’ve actually been with us for a long time already, whether that’s based on the extraction part or the conversion plant. We’re using those supplies and working with them actually to really fine tune some of the design.

So they will probably just go ahead and be a, negotiation and a supply agreement. Other things we will have to competitively tender because we obviously want to achieve the best outcome and the best value of really, partner with the. Companies that really, believe in our project and our behaviors and our mindset.

So we want to look for like-minded partners. So that’s what that tendering process will do also.

Antoine Walter: I’ve been discussing with standard Lithium headquartered in Canada, having the project in the us. I don’t know if you consider yourself competition because you’re really at two different ends of the world, but it was interesting to see how they developed that project and it really explains that they focus on their one project and then of course if something else comes, they might support it, but they really need to deliver the first one. You have phase one, phase two lined up and more projects in the pipe. Is it a different approach or do you also say the number one thing is phase one has to deliver?

Cris Moreno: I think right now it’s al always about phase one. share and echo that with Standard lithium. The reality is your whole sort of business case is, Predicated and premised on getting that phase one right, because then that’s how you can expand and expand with speed and with quality and, and all those things.

So you learn from that first one. , but at the same time there’s a need. I mean, the world is growing much faster than phase one. So where we are getting really good within, at least the Vulcan group, is that we’ve got a very much an execution mindset and a group looking after that.

But then we also have a development group who’s also looking at what is the next part of that pipeline or funnel. So we don’t wanna sacrifice one for the other, so we’re trying to move fast in execution. Phase one is our focus, but we are also looking at what is the next thing that we’ll bring into our pipeline.

Antoine Walter: Your DFS mentions you have 1.5 billion euros of CapEx to find for this phase one, do you already have all the money in the bank or do you still need to raise some money?

Cris Moreno: we don’t have all the money. That’s for sure. We’ve got about 120 million euros still in our bank which is good. We obviously do have a gap between that and trying To obviously finance the 1.5. We’re tackling a number of finance streams at the moment. and we’re being advised by BNP Paribas which people know.

So we’re looking at the debt side and the equity side. On the debt side we’ve had BNP really help us and we’ve started to talk to a lot of banks. We’ve just started that process. There’s been a lot of interest for a number of like, Commercial and standard banks to really support this type of project.

It’s a very green project. In fact, we do qualify underneath the European sort of EU taxonomy type rules, which means that we’re hopefully able to access green funding, green financing, which is really important. The other thing is that we’ve had really strong support from the export credit agencies around Europe, so whether it be France or Germany, or Belgium or Italy, and this is really important.

Because these export creditors can actually underwrite the banks. So obviously it provides, you know, much more assurance that, we’re a good bet. BNP have said that we can probably do 60, 65% debt and the rest have to be equity sort of 30, 35%. And so in that side, we’re actually talking with a lot of strategic.

Corporate partners. At the moment we’re talking to major oil and gas companies because they have a lot of similarity in the experience of our upstream, like they’ve drilled lots of wells, lots of geothermal wells, pipelines, processing power plants, that’s really quite a standard upstream oil and gas play.

oil and gas companies, they’ve got. A mandate to decarbonize. So they have to start transitioning themselves. So, that’s a pretty natural partner for us to say hey, you know, oil and gas company, do you wanna, you know, work with us? And transform in the downstream part though, the lithium chloride conversion to lithium hydroxide.

That’s actually standard chlor-alkali technology. So there’s like 11 chloride parts in Germany. I found out not too long ago. Germany’s one of the biggest chloride alkali supplies in the world but they’ve been taking what is sodium chloride using electrolysis to create sodium hydroxide and hcl.

We’re doing the same, but we’re just taking lithium chloride. So for us, we’re looking at number of chemical players big chemical players to really then, be equity partners with us at the project level for the downstream. So between the two we’re trying to balance the needs and also we’re obviously, we are looking for support from the EU and from the state.

A process from our member state Germany. Because at the end of the day, if you look at what’s happening in America, in the US, They’re getting a lot of funding support from the US through the IRA, this inflationary reduction Act. So that’s propelling, it’s shifted the balance actually quite badly from even China and EU over to the US.

 That’s been because there’s been a lot of investment. And therefore investment in follows investment. So public investment will follow the government investment. So we’re really looking at the EU to step up and really help a lot of these critical raw materials and these, net zero type projects like we are.

Antoine Walter: Well, if they don’t help you, I don’t know who they are gonna help. I mean, 84% projected EBITDA zero carbon only project of that magnitude in Europe and Europe building all these giga factories, someone will have to supply the lithium to them. So just my layman view on that. But

Cris Moreno: I’m glad you echoed the same as us. I mean, we are the largest lithium resource in Europe by a significant margin. We’re actually globally an important resource and something that we could almost provide all of Europe’s lithium needs if we could have the capital to develop our projects.

So yeah we’re hoping there’s common sense that at the level and the members state to support us.

Antoine Walter: So let me give you my anecdotal input here. I started all that. Lithium deep dive because I myself found a brine, which is lithium rich, which happens to be not that far from yours. I would say 80 kilometers south. What I verified, you don’t have a rides on that one yet,

Cris Moreno: Good.

Develop it.

Antoine Walter: I’m running a podcast.

I’m not running a lithium company. And my question is if I come to you with, have two analyzers. One is at 300 PPM of lithium. The other is at 400 ppm of lithium. Of course not the perfect thing. You also have all the staff inside, but you have a good lithium content. Are you actively looking into this kind of new projects or with everything you already have in your pipe?

I mean, you’re sitting, as you mentioned, on a resource which could be supplying the entirety of Europe. Maybe you don’t need to have additional projects.

Cris Moreno: I mean, we’re always looking for opportunities. There’s value, in, in creating partnerships. You know, we see ourselves as a technology company as well. We’ve developed our own. Effectively absorbent. So therefore we’ve created the heart of the DLE or DLS technology.

So, we are not that type of company. We want geothermal brains to work globally. If we wanna decarbonize the current world’s passenger fleet and electrify them. That would release over a billion tons of carbon to the air if we were to follow traditional hard rock or brine conversion.

That’s something that doesn’t sit well with the Vulcan people. So if it came to me and somebody said, can we do another geothermal brine, develop lithium? We’ve said, hell yeah. I mean that, that’s gonna help us in the world not just a company Vulcan. So, absolutely, and the upper Rhine and the French side is obviously, the Upper Rhine is one-third French, two-thirds Germany, so we know that the French part will have a big part to play as well.

Antoine Walter: Okay. I can’t crack you all my secrets, but it’s not exactly, I would say the middle line,

Cris Moreno: Okay.

Right. Gotcha.

Antoine Walter: Last one You have a lot of technical challenges because nobody, Ever did the DLE the commercial side you are really well aligned to overcome that DLE challenge and you’re tackling at the same time the DLE, so extracting the lithium, the heat production, and the energy, that sounds incredibly ambitious.

Are you sometimes looking at think, oh, maybe we can drop one of the three and go on the safe side.

Cris Moreno: I have to respectfully correct you. I think the DLE or the dls the absorption has been around for a long time commercially. There’s LIvent and had been operating their plant in South America. China’s actually got four absorption plants. The exact same ab absorbent that we’re using in China have been operating for decades.

Rio Tinto are doing another absorption plant in Argentine as we speak, and they’re called the Rincon Project, and so is Eramet good French company also in South America. So there’s actually a number of commercial scale absorption. In fact, at the moment, as we understand it, absorption accounts for 10% of the lithium supply globally.

So that definitely underneath the DLE umbrella is commercial. But I know, I know what you’re saying. We’re combining different things. What may be seen for the first time I’m typically a individual. But the way I see this upstream, it’s a really, some people see it as a complex mining project.

I see it as a very easy oil and gas project cuz I come from complex oil and gas projects where we spend 20, 30 billion, not 1 billion to produce the upstream where we drill wells, we install pipelines, we recover that, we process it, and we create our own power and then we sell that to a refinery. So that’s how an oil and gas project works in Australia, Europe.

You know, anywhere in the world. So for us, we just feel like we’re bolting together and combining proven technologies in a clever way, which doesn’t mean we need fossil fuels and that’s really what we’re trying to do. And so that’s the non-humble part of me. But it’s also about engineering those technical interfaces to make sure they’re good.

So most of our focus at the moment is really working those technical interfaces between a well, a pipeline. A glorified water processing facility, cuz that’s what the lithium extraction is. It’s just a water processing facility and we create some geothermal power and then we sell that to a chloride plant and that makes hydroxide, so we feel pretty comfortable to be honest.

Antoine Walter: Well, I have to be respectful of your time. Thanks a lot for all these very open answers. Chris. It was pleasure to have the discussion with you. Your DFS is just out. I’ll link it in the notes of the episode. Of course. What’s the next milestone where people can follow you?

Cris Moreno: So I think for us, we’ve got a big two quarters. Those two quarters really a big focus around our demo plants to be up and running probably in the beginning of q3. Those demo plants are really important for people to see that, this thing can be extracted, the lithium can be extracted in big numbers.

And operate with our operations team and probably the wells. We’re gonna start drilling our first wells in Q3 as well. So Q2 is about preparation. And then Q3 is about execution of our first major projects. And yeah, I mean, we’re 300 people at the moment. We’ll be 450 people by the end of the year, so Vulcan’s growing pretty quickly.

And yeah, we’re getting ready for that next chapter.

Antoine Walter: Well, I’d be very happy to have you back to discuss that next chapter, and thanks again for the in-depth answers you’ve provided us today.

Cris Moreno: It’s absolutely my pleasure, Antoine. Thanks a lot.

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Conclusion: Zero Carbon Lithium

No rapid-fire today, as Cris was kind enough to find a slot in his otherwise very busy calendar, so I really focused the conversation on the core of Vulcan’s endeavors. But this closing segment enables me to remind you once more – sorry for that – that you are the engine of this podcast’s growth. I do my best to serve you high-quality content; if you agree it’s good, share it around, and if you have any criticism or remarks, please send me a message on LinkedIn or a mail: antoine@dww.show.

I’ve been teasing you about my red-thread backyard lithium project since the first episode of this mini-series; as I’m recording this, I’ve made good progress on geological surveys, various assessments, meet-ups with experts and even preliminary testing of the brine to check how a certain technology would deal with it… I can’t tell you more today, but I can guarantee it’s the most ambitious project/piece of content/video I’ve ever produced, and I can’t wait to share it with you!

This time I stop talking; see you next week with Chris Wyres, the CEO of Evove, to discuss membranes, scaling up a promising tech, successful fundraising, graphene, and of course, in this series, also a bit of how all of that applies to lithium extraction. Cheers!

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The post Vulcan’s Clever Strategy to take off its Zero Carbon Lithium: Sell it Years Ahead! appeared first on (don't) Waste Water.

(Also check my entire Lithium deep dive!)

with Teague Egan – CEO & Founder of EnergyX 

EnergyX is on a mission to become a worldwide leader in the global transition to sustainable energy

Lithium Refinery – Slider

What we covered:

How the story of EnergyX started in the salt flats of Uyuni with Teague Egan’s initiatory journey to Bolivia

How EnergyX has a masterplan and how this one goes beyond “just” supplying lithium extraction technology to the World

How the company’s claims of a disruptive approach to direct lithium extraction are backed by an impressive amount of patents all along the value chain

What the problem with existing lithium evaporation ponds is, and how that offers significant potential for improvement for new technologies

How lithium-ion battery legend and Nobel Prize recipient John Goodenough endorsed EnergyX’s efforts in the battery space and how the company breeds his legacy

4⃣ The four key aspects to consider when working on a lithium extraction process

How EnergyX’s take at Direct Lithium Extraction needs water neither on the membrane nor on the solvent extraction side

How the company got kicked out of Bolivia’s lithium tender for questionable reasons, and how they might come back in the game given their unique technological perks

How pure end-to-end DLE probably is the future of lithium extraction, but how DLE enhanced ponds are the best hybrid for a smooth transition

How Global Emerging Markets Group placed a $450 million check on the table for the day EnergyX goes public, what it enables, and what it involves

How you scale a lithium extraction approach from pilot to demo and ultimately down the road to commercial-scale applications

EnergyX’s Edisonian approach, the special sauce to the company’s lithium extraction process, the lowest permissible lithium concentration for their technology (and why it’s different than their competition), the company’s bet as to the place where it will go full-scale first… and much more!

… and of course, we concluded with the 𝙧𝙖𝙥𝙞𝙙 𝙛𝙞𝙧𝙚 𝙦𝙪𝙚𝙨𝙩𝙞𝙤𝙣𝙨  

Resources:

Come say hi to Teague on LinkedIn

Check EnergyX’s website

is on Linkedin

Antoine Walter on LinkedIn

Teaser

Full Transcript:

These are computer-generated, so expect some typos

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Antoine Walter: Hi Teague. Welcome to the show.

Teague Egan: Thanks, Antoine.

Antoine Walter: I’m very excited to have you as part of this deep dive. We are running on the podcast on lithium topics because so far I’ve had the traditional players. I’ve had the evaporation pond players, I’ve had some consultants, I’ve had technology companies, but I didn’t have a pure player in that. Fascinating new fields of DLE and beyond, because we’ll see that you go beyond just DLE, but before jumping in, To all of that, I’d like to start with my postcard question, and you’re sending me a postcard from Austin.

So what can you tell me about Austin that I would ignore by now?

Teague Egan: I am sending you a postcard from Austin. You know, Texas is a pretty interesting place. Austin is becoming the new Silicon Valley of the United States. You have All these incredible technology companies moving here such as Google, Facebook obviously Tesla is moving here.

Qualcomm so you know, a lot of venture capitalists are moving here. A lot of technology companies are moving here. Austin, just a very exciting spot right now. A lot of good food, a lot of good music, a lot of good culture. I would say that Austin is a blue dot in the Red Sea of Texas. So it’s an interesting combination of cultures and a melting pot of different people.

So it’s a pretty fun place to be.

Antoine Walter: Mentioned the red aspect. I think that’s something which might be a red threat to the story of EnergyX because if I’m right, the story of your company starts in a desert. Can you tell me something about that?

Teague Egan: Yeah, definitely. The idea for EnergyX Originated from a trip that I took to Bolivia down in, the salt deserts essentially in the and Indian Mountain range. And, most people don’t think of Bolivia as a beautiful place, but this salt flat in Uyuni in Bolivia is the world’s largest salt flat.

And it is. Absolutely magnificent. One of the most beautiful places I’ve ever seen. And it turns out that this salt fly is also the world’s largest lithium reserve. when I heard that, that inspired me to start EnergyX and began looking at ways in which we could more efficiently and cost effectively extract lithium.

Antoine Walter: You say, looking at ways on your website, it’s very clearly outlined how you have a ten year master plan about how you plan to achieve that. Can you take me through those steps?

Teague Egan: Absolutely. So the master plan that we have on the website is even beyond just lithium extraction. Lithium extraction is the first step. To a renewable future. And you know, as I look at the energy transition, we are in the beginning stages of an energy transition moving away from fossil fuels that are both finite resources, but also have a very significant co2 impact Moving away from that.

Is going to take not only a lot of investment, but also a pretty substantial amount of time. And creating the materials to store energy such as lithium is in my mind, the first critical component to that. Then improving upon these energy storage systems such as batteries is the second component to that, and all the while creating.

Better sources of renewable energy generation and then vertically integrating these components. So that’s how I think about our 10 year master plan.

I published the master plan, at the end of 2019. we’re about three years into it. And you know, we’ve made very significant progress on our lithium extraction.

Technologies you know, we’ve learned a lot. We’re basically pioneering a new way of extracting lithium and producing lithium.

There’s a lot of breakthrough technology that we have developed. We look at existing technologies and then take components of those different things and then put it all together to create something new, novel and non-obvious.

And we’ve, filed a lot of patents around what we’re doing. We have over 60 patents now. We’ve basically created a paradigm shift in lithium extraction technology from the current way that lithium is produced, using these massive evaporation ponds that take about 18 months to yield lithium.

They can be 15 square miles in footprint, and most importantly, they only recover about 30 to 40% of the available lithium that enters into the system. for us, there’s a lot of inefficiency in all three of those metrics. We want something that is a lot smaller in footprint that doesn’t, you know, harm the natural environment.

We want something that takes a lot shorter time than the 18 months, and we want something that can recover, hopefully near a hundred or at least over 90% of the lithium that enters the system. So those are the three aspects that we’ve created technology to improve upon. And we have a lot of smart people here at EnergyX working on that.

Antoine Walter: There’s a lot to unpack in what you just said regarding these numbers. If I’m right, you can extract 94%. That’s what your pilot plant yielded,

Teague Egan: Yes.

Antoine Walter: Before jumping into that one, you mentioned breakthrough technologies. I’m just wondering is that what owned you, this envy title, I guess, of Lithium King?

Teague Egan: I’m not mad at that title. It’s pretty cool. I gu I guess I’m the lithium king, but yeah, I mean, we are 55 people now at EnergyX that. Each and every day wake up thinking about how to solve problems, laser focused on lithium extraction. each and every day out of the 55 people, about 35, maybe 37 are science related.

And of that I think, 25 are PhDs. So you know, the top education in science that you can get. Figuring out how to solve these problems is what we do on a day-to-day basis. So, lots of exciting science and experimentation. Lots of failures, uh, took Thomas Edison, 10,000 tries to invent the light bulb.

And some of his other inventions even more. he was trying to create rubber out of plants when he was working with Firestone and Ford to make tires for, cars, and it took him 18,000 different tests to do that one. So, over here we kind of take an edisonian approach and.

There’s people running experiments, every single minute to try to figure out the best way to improve upon the existing process or actually create new processes that can solve those three problems that I mentioned before.

Antoine Walter: You mentioned 55 people, of which 35 to 37 are scientific people, and of which 25 are PhDs I’ve seen that you’re working with. I don’t know if he would appreciate that term, but with the godfather of lithium ion because Professor John Good enough got the Nobel prize for his work on batteries. And if I’m right, you’re working with his laboratory of Texas State University where if I’m right as well, he’s still working.

how did you start working with him and what’s your link towards Texas University?

Teague Egan: so it’s university of Texas at Austin which is where he spent the latter portion of his career as a professor. And John Good enough, turned a hundred years old last year in July of 2022, and. He’s unfortunately not working still to this day. But he was working every day at the university until he was 98, years old.

I guess 98, right? Right before Covid when Covid started. stopped coming into, you know, school, like everybody stopped going to work, et cetera. But Literally worked every day of his life until 98 years old. Never had kids, was never married. He was 100% dedicated to education his students and.

The spirit of, pushing science forward. the way that I came in contact with Dr. Good enough was EnergyX originally licensed some of our patents from the University of Texas focused on lithium extraction using membranes. But it turns out that those membranes had a lot of applicability.

As a component inside batteries. So I went over to Dr. Good Enough’s office. This was when he was at the ripe age of 96. And he thought that, some of my ideas were worth testing, he ended up putting me in touch with one of his last. PhD students a gentleman named Nick Grund, who is now , our VP of Battery Technology and a Forbes 30 under 30 winner.

that started EnergyX’s pursuit of batteries. Nick with us as a consultant during the first year and a half. Because he was still finishing his PhD and Nick ended up leading the charge in getting several of Dr. Good enough’s other students to work on our project.

So, as Dr. Good enough, his, to work. At this point, EnergyX is basically assumed. Several of Dr. Good enough students, and I think on our battery team, we have four Dr. Good enough alumni on our team. That’s a pretty exciting thing for me. And, it’s truly an honor to even, have the opportunity to talk and, receive advice and mentorship from Dr.

Good Enough, and then be working with, his lineage of scientists.

Antoine Walter: You mentioned 60 patents. Out of these 60 patents, if I get what you just said, there’s a section of it which is linked to battery themselves. What’s the proportion of patents which goes to this extraction of lithium?

Teague Egan: don’t, I don’t have the exact numbers, but I would say roughly maybe a fifth of those. So eight to 10 probably are battery related patents. And then the rest are around our extraction technologies and applications.

Antoine Walter: There’s one thing that struck me when I watch your website on your lithium extraction technology is that, I dunno if you’re playing g guitar yourself, but if you portray like a Marshall Amp, your lead test technology looks exactly like a martial amp. So it’s really in terms of, I mean the coolness is great there because it looks great, but beyond the coolness, what’s inside Litas?

Teague Egan: Yeah. Leidos is the name of our portfolio of technologies. It stands for Lithium Ion Transport and Separation. we want to. Transport the lithium away from the rest of the impurities that are dissolved in the brine and separated away. we have several different technologies that that problem and we use a combination of absorbance.

Solve an extraction and membranes to do that. And one of our biggest competitive advantages as a company is that we can custom tailor the process depending on the challenges that a brine provides. So there’s no brine that’s the same. way that I like to communicate this to somebody that doesn’t know about this is that there are Four main challenges that need to be taken into account when considering the proper technology to use.

brine is in liquid form, and the lithium is dissolved into the brine alongside many other salts. Lithium is found in a salt form here.

And the four things that need to be taken into account, one. What is the concentration of lithium that’s dissolved in the brine? Is there a very little bit or is there a lot?

And this is determined using a parts per million metric, right? So is there a hundred parts per million lithium or are there a thousand parts per million Lithium

Antoine Walter: which concentration would you start looking at it?

Teague Egan: we start looking at it at around 150 to 200 is the lowest real feasible concentration that you can use direct lithium extraction. So the concentration kind of dictates if you may start with one technology or another. The second is what is the impurity profile? So what other salts are dissolved in this that you need to separate lithium away from?

Is there a whole bunch of sodium, which is table salt? That’s a relatively easy thing to separate lithium away from, or is there a bunch of magnesium and sulfate? That’s dissolved as salt into the brine. those are much more challenging impurities to separate lithium away from. Is there boron?

Is there calcium? There’s probably 10 to 15 different elements that can also be dissolved into the brine. That plays a factor in which technology is the most efficient.

Antoine Walter: on the second, is there like a no-go? Like if there’s something above a certain concentration, you would simply not consider looking into it.

Teague Egan: Really high levels of magnesium. It is bad. We kind of hang our hat on the fact that we can deal with some of the highest of magnesium, such as in Bolivia. It’s all about the ratio of these other dissolved salts as compared to lithium. in Chile they typically see one lithium for every four to six magnesium.

And that’s a ratio that they’ve had a lot of success with producing the most lithium from brine based resources. In Bolivia, they have 25 magnesium to every one lithium. And for that reason they have had zero success in producing lithium. So when we ran our systems in Bolivia that was the main challenge that we overcame and we hit that 94% recovery rate.

So that was a huge accomplishment for us as a company. The third challenge that needs to be considered is the temperature of the brine. in most of South America, you’re just dealing with ambient temperature brine. You pump it up and it’s relatively near the surface, maybe a few hundred meters, something like that.

In California in the Salton Sea, they have a tremendous amount of lithium, spawns from geothermal brine. So 4,000 or a few thousand meters deep. this comes out at over 300 degrees Celsius. So putting that through a system you need to be able to deal with that.

High temperature and specific technologies don’t do well with temperature. Some do, so that plays into consideration. The fourth not necessarily a characteristic of the brine itself. But a characteristic of the region and the available inputs that you have for your technology. water is one, the availability of fresh water which, you know, there’s a decent availability of freshwater in California or you know, Arkansas, but there’s.

Very limited availability of fresh water in the high Andy and mountain range, in the lithium triangle in South America. So if your technology needs, a hundred tons of fresh water input for every ton of lithium, that’s a real challenge. And maybe a no-go.

Antoine Walter: What would be your ratio? If I’m right, that’s one of your assets.

Teague Egan: it depends on which technology we use, and that’s one of our biggest competitive advantages is that both our membrane technology and our solvent extraction technology don’t need fresh water as an input. absorption, technology needs fresh water, uh, come up with ways to reduce the fresh water to.

Like one fifth of what other absorption based technologies require?

Antoine Walter: you mentioned your pilots. I’d like to understand exactly the context of that pilot.

Teague Egan: we piloted with Y L B, which is the state run. Bivian Lithium company.

Antoine Walter: that’s the pilot where you were 10 minutes late to submit the results.

Teague Egan: Yep.

Antoine Walter: What? What’s that story?

Teague Egan: I mean, it pretty much is what it is. You know, I learned a valuable lesson. it’s unfortunate that they, you know, used that as the reason to. Disqualify us from the tender. But I think that everything happens for a reason and I think that it would’ve been extremely hard to compete with C A T L who eventually won the tender.

We might have, wasted another whole year of time and resources pursuing that. When, c a TL might have been a lock from the beginning. Who knows, right? Like there are obviously other geopolitical factors that played into that. I think that Bolivia has closer relations with China than the US to begin with, so who knows, right?

I still think that there actually is a chance that we could work with Bolivia in the future because, we have the best technology to compliment existing pond infrastructure where I think that what they’re expecting out of C A T L is directly at the extraction straight from the wells.

And they’ve already spent a ton of money on those ponds. So if they can figure out how to. capture some of that value. EnergyX could be helpful there. But I turned in the report 10 minutes late and I could, you know, sit here and give you every excuse on why it happened, but ultimately it was my responsibility to turn it in on time.

So there, that’s all there is to that.

Antoine Walter: I think we could make another podcast on the BOL in case, which is the biggest reserve of lithium in the words, doesn’t produce a gram today. But that’s really too much of a topic , to dive into. What I’d like to understand is that there are two approaches to dearly what you just said about C A T L would be like you take really Bryan and you do dearly straight of the bat, and maybe that’s how dearly will be in the future.

But there is maybe a step in between, which is to combine DLE with evaporation ponds. And again, if I understood right, what you’re aiming at within your roadmap, that is one of the first step, which comes within the next two years. I right?

Teague Egan: Yeah, absolutely. I mean, the future of d l E is no ponds but for the people that have already built ponds and spent billions of dollars doing so, and are leaving 60 to 70% of the lithium on the table, or in Bolivia’s case, essentially a hundred percent of lithium on the table. Why not try to, capture some of that loss value.

And going back to our portfolio of technologies, you know, we can obviously do direct from wellhead, greenfield, dle. But we’re the first ones to think about how we can compliment existing pond infrastructure and insert some of our separation technologies at a point in the pond process just before they start to see those huge losses.

And, you capture some of that and increase the output from existing pond infrastructure. we filed patents around all of that cuz nobody else is doing that or had thought of that. I think that’s would be a huge win for, a small number of companies. Like there’s only, call it five to seven companies that have built extensive pond infrastructure.

You have s q m, Alba Alchem, liven, lithium Americas, and Y L B. But those are the major players right now, and if you can double or triple their output from the existing ponds with the same amount of brine that enters the ponds system, that’s a huge economic windfall for those companies.

Antoine Walter: Economic windfall plus also. Possibly eliminating one of the bottlenecks, which might be the water.

Teague Egan: Yeah.

Antoine Walter: just noted some of the big names I saw in your corporate deck. So there was all cam and there was Suez who I’d like to understand. And there are the third one. So what’s what you’re working on with all Camm and Suez?

Teague Egan: So those were earlier partnerships in our development. We did testing for CHE about two years ago. And we had great re. Results. But they are still trying to figure out which d l e technology they wanna move forward with. As for suez, we had a term sheet with them to help us figure out some of the initial phases of our membrane extraction process.

And they were extremely helpful in thinking through. Some of the early designs for our electrodialysis and bipolar electrodialysis are, that’s complicated for our membrane processing units. But we’re no longer working with them. We’ve basically taken everything in-house both those companies were instrumental to the beginnings of EnergyX and, you know, I’m eternally grateful. But we’ve kind of gone out on our own and are figuring out relationships with other customers outside of Alcom and our own in-house manufacturing of membranes and the ancillary equipment that holds membranes for processing.

Antoine Walter: So there’s a third big name in that corporate deck, which is maybe more catered towards your future, which is Global Emerging Markets Group, and there’s a very big number associated to that name, which is 450 million that they committed. What’s the deal there and what does it enable you to do?

Teague Egan: Yeah, global Emerging Markets is a great company that helps Companies like ours that are operating in emerging markets gives us access to capital upon a public listing. this was actually the biggest deal that global emerging markets has ever done. I think that so, in that we’re in the, you know, one of the hottest sectors in Lithium.

That’s one of the biggest emerging markets we’re operating in countries. Like Bolivia, Argentina, Chile, they’re also emerging markets. So it really fit their thesis very nicely. And they basically came to us and said, look, if you guys go public, we will commit 450 million after you’re publicly listed.

So, was a huge vote of confidence for us. And we obviously want to go public at the right time. But you know, having that kind of backstop and commitment gives me some comfort and confidence when I go to bed at night.

Antoine Walter: When you say right time, do you already have some ideas which you could share?

Teague Egan: Not specifically, right now we are in the phase of moving from the pilot that we launched in the field to larger demonstration plants. So the pilot that we did was a relatively small pilot that could only process a couple tons of lithium per year. And that’s not quite big enough to move to a full commercial plant that could say process 10, 20, 50,000 tons.

So these next larger demonstration plants that we’re building. Can process a hundred tons of lithium per year and from all the customers that we’ve talked to that we’re continuing to test and scale up with a hundred tons capacity is the right size that would enable us to go straight to full commercialization from that point.

Antoine Walter: That’s lithium hydroxide.

Teague Egan: yeah, lithium hydroxide or lithium carbonate, either one.

Antoine Walter: Sorry, did want to cut you off just to be clear.

Teague Egan: we want to have at least crossed this demonstration plant threshold and be on our way to building a few large commercial production plants before we go public. That’s at least my mindset right now.

Antoine Walter: Your timeline to commercial plans, if I’m right, is for 2024. 2025.

Teague Egan: Yep.

Antoine Walter: You say a couple or a bunch or several of them. If you had to take a totally open bet, which is not binding in any kind of ways, where would you see the first commercial plant?

Teague Egan: Oh man. I don’t know. You know, I think that there are some great opportunities that are on our plate right now. I think that it’ll be between one of three places, either Argentina, Chile, or the United States.

Antoine Walter: One of your demo in between is gonna be at the Salton Sea, right?

Teague Egan: we’re, in the process of building a demonstration plant for the Salton Sea right now.

Antoine Walter: So one of those or another, who knows opportunities can come up actually. I try to be cautious every time. I see that you have a broad roadmap for the future, which means to me that there would be more opportunities to have that conversation again when you have new milestones to share. I have a last question for you in that deep dive, which is actually for my investigation of lithium, I’ve made a testing the water, which is 10 kilometers from my home, and we used to have potash mines It’s history thing and there’s water there with highly chi content. Pretty high.

Teague Egan: How high?

Antoine Walter: 4,000 ppm.

Teague Egan: Oh, wow.

Antoine Walter: I suspect that was an outlier. I would expect the average to be around 400 ppm. So let’s assume 400 ppm. I looked a bit magnesium. There is some magnesium. There’s. Less than at the Salton Sea. But there is, I mean, I looked a bit at Scavengers. My question here is I obviously don’t have a company, I don’t intend to start a company, but in the Hypothe thesis, I would have this ambition.

I dunno if you’ve seen, but recently India just found out that they have a bunch of lithium and that maybe they are the fifth largest reserve in the world, and nobody knew so. You have this Greenfield projects, what is the approach to them? Would they call a company like you? Would they start their own thing?

How do you fit into that ecosystem?

Teague Egan: They would most likely start working with a company like ours who specializes in the extraction refinery of Lithium. Unless they wanted to go figure out how to do it all themselves which is. Most likely, you know, not the case. They would either license technology or get a company to come in and build, own and operate a plant.

And then there would be some sort of licensing deal or profit sharing deal on the lithium that’s produced between the company that’s extracting it and refining it and getting the product and whoever owns the resource.

Antoine Walter: So the day I create my potash company, I give you a call and we can see how we figured that out. Maybe that’s your first commercial plan. You don’t know.

Teague Egan: You never know.

Antoine Walter: To round up this interview, I have rapid fire questions. I’ll take just three of them.

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Rapid fire questions:

Antoine Walter: what is the most exciting project you’ve been working on and why?

Teague Egan: The most exciting project I’ve been working on is Scaling the technology for the demonstration plants working on stuff in the lab is exciting in its own way, but then seeing these systems come to life in, big equipment and machinery that actually gets deployed to the field is.

You know, just the next level of exciting. So, you know, we’re right in the middle of scaling these systems to like large tanks and large mixers and large vats and things like that, that we’re deploying to the field. And that to me is pretty cool.

Antoine Walter: Can you name one thing that you learned the hard way?

Teague Egan: Yeah, don’t be late turning in reports.

Antoine Walter: I would expect that one. And last one, would you have someone to recommend me that I should definitely talk with?

Teague Egan: Yeah, I think that you should talk with our VP of Battery Technology, Nick Grish. He’s he knows, obviously way more than me about batteries. So if you’re interested in batteries, I would talk to him. If you’re interested in talking more about lithium extraction as related to this story, I would say that somebody I would talk to is our president of South America.

A gentleman named Juan Carlos Burrera. He spent 30 years at S Q M half of which he was their senior Vice President of lithium operations. He literally built their entire evaporation pond system, 44 million square meters of evaporation ponds, as well as all, all of their lithium processing facilities to get to lithium carbonate lithium hydroxide.

So for batteries, our guy Nick, and for lithium our guy Juan Carlos.

Antoine Walter: It sounds like you really have the Avengers team working with you on all those stuff. So impressive. Well, Teague it’s been a pleasure to do a bit of that exploration with you. I’d be delighted to have you back or to have the two suggestions you had on the microphone to explore a bit further up and down the value stream.

And yeah, I wish you all the best in the next demo and commercial plan because one of those we will be doing together. Just that, you know.

Teague Egan: Yep. Perfect! Thanks Antoine.

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The post The Game-Changing Company with 60 Patents That’s Disrupting the Battery Industry appeared first on (don't) Waste Water.

Find out more with my entire Lithium deep dive.

with Jim Rieke – VP of Process Engineering at Veolia Water Technologies

Veolia Water Technologies specializes in water treatment solutions while providing a complete range of services for industrial & public authorities

Lithium Refinery – Slider

What we covered:

How HPD onboards all its hires through its service and commissioning groups and how that’s the best learning experience to Veolia Water Technologies’ portfolio

How the milestone Naraha Lithium Refinery reference started through a collaboration between Orocobre (now, Allkem) and HPD and what was the step by step road to success

What’s the magic that turns Lithium Carbonate in South America into Lithium Hydroxide Monohydrate in Japan

How there might be standard building blocks but how every lithium carbonate is slightly different and hence requires a tailor-made lithium refining process

Where do impurities appear in a lithium refinery process and how to remove them to guarantee a battery-grade output

How extracting lithium from clay is still a very new process and what it changes in the lithium refinery set up

How Veolia Water Technologies’ holistic approach is a key differentiator in the development of a lithium refinery

How geopolitics and government incentives play a role in the economics of a lithium refinery

How the newly wed SUEZ and Veolia offer an even broader portfolio of complimentary technologies to better serve the lithium market

How DLE “suddenly” makes much more lithium available and how HPD’s lithium refinery process copes with the source’s specificities

How batter-grade lithium is just one of the outputs of a lithium refinery: Veolia Water Technologies’ expertise also allows to valorize several more by-products along the way

How Veolia Water Technologies’ involvement in projects can help get junior lithium companies get financed as a valuable reference partner

Building a Lithium Refinery step by step; leaching, evaporation, crystallization, ion exchange: the lithium refinery keywords; lithium refining in the broader scheme of the EV battery vertical; turning sodium sulfate into sodium hydroxide and sulfuric acid; empowering circularity… and much more!

… and of course, we concluded with the 𝙧𝙖𝙥𝙞𝙙 𝙛𝙞𝙧𝙚 𝙦𝙪𝙚𝙨𝙩𝙞𝙤𝙣𝙨  

Resources:

Come say hi to Jim on Linkedin 

Check Standard Lithium’s website 

is on Linkedin

Antoine Walter on LinkedIn

Teaser

Full Transcript:

These are computer-generated, so expect some typos

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Antoine Walter: Hi Jim. Welcome to the show.

Jim Rieke: Hey Antoine, great to be here.

Antoine Walter: I’m looking forward that conversation for many reasons. The first being that, you know, Veolia is the big dog in the water industry, and I had a couple of interviews with Veolia guys, but not as much as statistically I should have within the amount of podcasts already published. So you’re here to repair that mistake.

And much more importantly, we are digging into a topic, which sounds really fascinating. I guess it’s gonna be really about lithium refining, but also everything which is around that. But before going into the deep dive, let’s start with the tradition on that microphone, which is to open with a postcard.

What can you tell me about Plainfield, Illinois, which I would ignore by now.

Jim Rieke: Plainfield, Illinois, it’s a suburb of Chicago. Pretty much the furthest Western suburb before you hit the corn fields that exist in the rest of Illinois. It’s a kind of a small town atmosphere. It’s got a little downtown area and good schools, good people good Midwestern values. And that’s where our office happens to be located.

Antoine Walter: And you’ve always been working from Plainfield, or did you move as well?

Jim Rieke: This area for sure. Our office moved a little bit. We had a originally our office was in Naperville, Illinois, which is the suburb just north of Plainfield. We had our r and d facilities in Plainfield, and eventually we built a new office building to be next to our r and d facilities and relocated there.

But yeah, for the last 30 years, I’ve been either in Naperville or Plainfield.

Antoine Walter: You mentioned the last 30 years, actually, that’s something really impressive in your path is that. You started as a commissioning engineer at HPD and 30 years down the line you’re director of process engineering and VP of Veolia Water Technologies. What did you learn along that path?

Jim Rieke: I guess it is kind of odd in our. Industry and generally in the world today for folks to be at one company that long. But it’s pretty common in, in my group. You know, we try to start our new hires in through our service and commissioning group, which is where I started, and that’s really the best to learn having experience in the field.

Directly with our equipment and our clients very steep learning curve,

Antoine Walter: What did you commission when you started?

Jim Rieke: the systems we design and provided mostly evaporation and crystallization systems. We’re a little bit strange in the Veolia world that Veolia focuses more water systems. I’m in the water division of Viola Water. But our group gets a lot into Production side of things.

Chemical, inorganic, chemical production, refiners systems of that nature. So, yeah, a lot of learnings in that area. And after the commissioning process I moved into our process design group. actually designing the the systems we provide and then transitioning into a sales group for a bit.

And then back to being the manager of the design group.

Antoine Walter: did the recent moves with the merger with SUEZ affect your role or do you have a broader Specter today or? did that change your life?

Jim Rieke: it’s another set of colleagues, I think and another. Set of technologies that are complimentary to ours hasn’t really affected my work too much. Other than gives us a little bit more flexibility in the systems that, we can offer by integrating and collaborating with the Sue technologies which, which are very complimentary to, Veolia’s Toolbox.

Antoine Walter: I have a muggle question. What does H HPD stand for?

Jim Rieke: Yeah, we get that occasionally. It’s goes back a while. H HPD was initially the Horton process division of Chicago Bridge and Iron. This was back pre 1970, and a few of the gentlemen in that company decided to split off and formed their own company. So that’s where H HPD branched off in 1970.

And we’re doing similar. things that, we did back then, just on a broader scale, and eventually, H HPD was acquired through a series of acquisitions into the V eolia family!

Antoine Walter: The reason why I wanted to speak with you today is that I’m conducing a lithium deep dive on the podcast, and I started a bit looking into the various value chains and there was one plant which popped up, which is the Naraha plant in Japan, I saw as. Plants that you’ve been developing and building for two 10 the story of that plant?

Jim Rieke: the Naraha plant is something that I’m personally very proud of, it’s a good success story for our company as well as, Orocobre who’s now Allkem. Combination of Galaxy and Orocobre formed Allkem a few years ago. The Miraja Plant is a joint venture between Alchem and Toyota TSU Corporation.

Toyota Lithium Company is tlc. They go by now that joint venture. we began working with or Cobra on this. It was probably five or six years ago now. Initially through our, testing facility where we demonstrated the flow scheme that they were looking to apply. And the plant is a facility that converts lithium carbonate to lithium hydroxide monohydrate. Allkem facilities in South America that produce lithium carbonate.

Lithium carbonate is shipped to Japan and through this facility is converted into battery grade, lithium hydroxide, monohydrate. So the entire process was developed by Veolia our group. As I said, we then did demonstration validation testing in our pilot facilities, which are also in Plainfield, Illinois. It’s a lot of close collaboration with the Ora Cobra people. Subsequently we entered into an engineering phase that was, it’s probably a year of feed engineering before the project was fully released. And Veolia the large company that we are, we’re fortunate to have a an entity in Japan that we work closely with but has some. Pretty good history of constructing facilities in Japan as well. So the entire facility then was designed and constructed and commissioned as a Veolia entity.

 And operated?

The operation is by tlc the joint venture. That’s the plant started after some delays through Covid. We were getting ready to start actually last year, and then there was an earthquake in Japan which set us back a couple more months.

But toward the end of last year, the commissioning began. There was a slight break over the holidays, and then think we restarted early January the commissioning process, and by mid to late February, we were operating at greater than 90% rate. With on spec battery grade product, which is very impressive.

Antoine Walter: I think it is.

Jim Rieke: In this industry, you see other plants that sometimes have struggled to move through the commissioning process quickly, and I think it’s a good testament to TLC and certainly our commissioning group the the whole project execution team.

Antoine Walter: if I go back within that history, you said seven years ago you started working on the project, AK at the time comes to you and say, I have this brine. South America, which gets down, refined up to lithium chloride and if them carbonates, I want to convert that to Hydrocyte, so they take it to your plain field facility.

What is it that you have to test in your lab, and what is the treatment train which you end up building?

Jim Rieke: Sure. Yeah. Our lab is a really key tool in our design effort. In a lot of these flow schemes that can be somewhat unique usually will conceptualize the process flow scheme. in my group, the process design group and much of the unit operations that we use are fairly well known. The thing that is always unique is the actual chemistry of the lithium carbonate that Orocobre was producing, for example the expected quality of the lime that’s used in that process. So the testing facility allows us to validate process design that’s conceptualized and just make sure that the chemistry behaves exactly As we’ve anticipated and very important in the battery materials industry is the ability to produce, obviously the high purity product. So being able to understand how the impurities distribute through the system as you’re concentrating and purifying, is very important. And that’s something we’re able to do in the lab is very accurately flow sheet Chemistry and validate the process design. So we know that when we actually build the facility and commission it, that we’ll be able to achieve the purities required.

Antoine Walter: What’s this process? What do you have as steps which bring you from carbonate to hydroxide?

Jim Rieke: there’s a number of steps. the main overall process is using Lyme. To convert the lithium carbonate to lithium hydroxide. So the hydroxide ion is provided by the Lyme through the reaction with lithium carbonate. The lithium carbonate is reacted to lithium hydroxide with a byproduct of calcium carbonate.

So through the exchange of those ions, calcium carbonate is filtered, removed. And then you end up with a weak lithium hydroxide stream that also contains some of the impurities that entered with a lithium carbonate and with the Lyme that was used for the reaction.

that stream is further purified through ion exchange.

And then through a, an evaporative process, it’s concentrated and through a series of crystallizations of lithium hydroxide the impurities are removed from the lithium hydroxide. Lithium hydroxide is then dewatered and dried and bagged as a final battery grade product.

Antoine Walter: I’m right, the downstream portion of what you just described is the core of what H HPD does, so the evaporator, the crystallizer, probably also the dewatering. The first steps, so the ion exchanger, the chemical dosing of Lyme, is it also core technology from Veolia or is it stuff that source with partners?

Jim Rieke: It’s a combination of both. The reaction system the clarification. It’s something that our division is very familiar with and we designed those components. But you know, it’s technology that, can be procured separately from third parties. Certainly the centrifuges, the drying equipment are procured from third parties and integrated into the system. But we’re very familiar with designing and integrating overall processes. As you said, the main core technology for my group is evaporation and crystallization,

But we integrate those peripherals so that we can provide a system with a process guarantee around the entire plant.

Antoine Walter: So that’s one route to get to lithium hydroxide, which is this bride of Eva operation. And then you come with the refining. There’s another route which is currently developed. I’m not sure if there’s already a full scale of it, but it is to extract lithium from clays. And if I’m right, you have a project in the rail Ridge, so never with ion.

where are you in that project and is it comparable to what we just described starting with carbonate out of Bri?

Jim Rieke: Correct. Yeah. Yeah. We’ve been working with IIR for a few years now. Lithium from Clay has its own challenges. It’s a unique flow scheme. And again, the key is to concentrate the lithium and separate the impurities that are in the feed stack. So, with clay’s starting with their particular deposit.

There’s an acid digestion process. To remove the lithium and other compounds from the clay. And then that particular deposit also contains boric acid which Ioneer is intending to recover as a byproduct. through a series of, purification evaporation and crystallization steps the lithium is concentrated in a brine.

Separated from the impurities. And then a lithium carbonate precipitant is then removed from the brine and further purify to become a battery grade product. where we’re at with that project is we’ve currently done a testing and a, pretty good amount of engineering.

So it’s still in the engineering phase at this point.

Antoine Walter: When would you expect it to become commercial?

Jim Rieke: I’m not sure exactly the expected commercialization date, there’s still a probably a couple of years between the additional engineering and the construction process before, it’s started up.

Antoine Walter: So let’s take another route, which is, dare I say, the conventional route to lithium, which is to start with spodumene or lepidolite, whatever is in rocks, and then To refine that upt battery grade, be it carbonate or hydroxide. I was told that you were in Australia not so long ago, and Australia is known to be the place where we extract the spodumene and then we go down that route.

Jim Rieke: Correct.

Antoine Walter: Does that have a link to do I have to expect Veolia to have references and projects ongoing in spodumene? Do you already have some?

Jim Rieke: Yeah we’re currently in the, I guess, execution phase of one of those projects in Western Australia. There’s several companies that have built or are building refineries in that part of the world. From spodumene where there’s, you know, historically in, Western Australia, there’s been sp mean deposits that have been exploited.

A lot of that sp mean is currently processed in China, but in recent years there, SP mean is, intended to be processed locally and refined into lithium hydroxide. So, Albermarle Tianxi and covalent all have spodumene refineries in various states of construction and commissioning in Western Australia.

Antoine Walter: And Allkem just commission one. I’m just wondering because you’ve been working with Allkem in Naraha, so I was thinking maybe in Perth you might be also involved.

Jim Rieke: don’t know that Alcom has a spodumene facility. In Western Australia. I know they’re looking at some in Canada, which is another area where there’s sp But the company we’ve been working with in Western Australia for is covalent lithium.

Antoine Walter: how different is the process from spodumene compared to what we just discussed, starting from. Evaporation ponds.

Jim Rieke: sp odumene as you said, it’s an, or with, a couple of percent of lithium oxide concentration that spodumene conventionally is upgraded to maybe 6% as a solid through a benefaction process

Before it’s shipped to a refinery. Just to minimize the amount of.

 mass that has to be shipped. But then the refining process involves crushing and cal signing to convert the lithium to a forum that’s leachable. And then there’s an acid roasting process where the lithium is, basically roasted and leached from the ore to form a lithium sulfate brine. That lithium sulfate brine is then through a series of purification steps purified and concentrated evaporatively. That’s where we get involved. And then after the evaporation process, when it achieves a certain concentration, it’s cost to size to convert the lithium sulfate to lithium hydroxide. usually that’s through the addition of sodium hydroxide. the lithium sulfate sodium hydroxide reaction results in lithium hydroxide and sodium sulfate. Sodium sulfate becomes a main impurity that’s removed with a crystallization process. the remaining lithium hydroxide is then crystallized a couple of times to achieve the desire purity.

So it’s a little different than the other process except the very end where, Lithium hydroxide is crystallized for that last purification.

Antoine Walter: You gave some keywords like evaporation and crystallization, which call for probably your proprietary technologies. How do you address that market like an OEM providing your Evaporators and Crystallizers, or as an EPC saying, Whatever starts from roasting up to the final dewatering can be done by us as an epc.

Jim Rieke: The real value that Veolia provides is the ability to understand the entire process and to be able to provide a system to I guess achieve the end goal from a starting brine, for example. So we’re able to provide all of the unit operations in order to achieve That technical goal and provide a process guarantee around that whole system. From a E P C standpoint you know, the construction side of things that’s not where so much, where Veolia’s value lies. Although we have in the past taken on E P C responsibility rather unusual. Our core value add is the system design and the supply of proprietary equipment that allows us to.

Achieve that that technical objective?

Antoine Walter: If I dare ask who’s living in that space with you? Let me try to name drop some Koch? Would that be the other big fish in that pond?

Jim Rieke: Yeah. I mean, Koch is somewhat involved in the lithium industry, but they’re more involved with, the EPC side and Some of the technologies but not as an extensive portfolio of technologies as Veolia.

Antoine Walter: So you would rather be working with them than be competitors?

Jim Rieke: yeah, and in some cases we are in the industry. They’re we’re somewhat complimentary to each other.

Antoine Walter: I’m trying to wrap my head around it. When I interviewed Ben Sparrow from Saltworks, he named spontaneously Veolia as the big dog.

Benjamin Sparrow: we do absolutely do have competitors.

 There’s a certain very large and, reputable company out of France. Okay, so the Reds, . Yes. Yeah. And, uh, they equally like us practice industrial desalination. And with that, they’re a leader in CRC in lithium.

Antoine Walter: So I guess Saltworks is your competitor as well.

Jim Rieke: Saltworks more is focused on I think the technologies, the evaporation and crystallizations. So they play maybe closer in the space that we do, but they’re somewhat smaller company. And, again, I don’t think they have the range of technologies that, that Veolia does. That’s really what differentiates, Veolia is that we’re not only the big dog as Saltworks said in evaporation and crystallization and in the lithium world, but also the ability to just provide almost any unit operation required and integrate those all together to offer a system.

Antoine Walter: The reason why I’m asking is when I discussed with several consultants, what they told me is that, The bottleneck in that road. I mean that PowerPoint Road 2030 where we can maybe meet the lithium demand with some additional supply. The bottleneck might be on the refining part. And what some told me is that the order books are quite full in the companies like yours, which means that also the lead times will at some point get longer and it might become a challenge to deliver all of these plants worldwide. Does that. Depict your reality.

Jim Rieke:  the challenge is quite large for the industry. you know, you’ve seen the amount of incentives that are being provided by various government entities and the announcements from almost all the automobile manufacturers.

That are planning to build EVs and have actually committed to a certain number of EVs by 2030 or 2035. So there’s gonna be a huge demand and there’s a whole value chain that’s required to support that vehicle production. So it’s designing and building the car manufacturing facilities. Designing and building the battery plants to support those vehicles. And going down a step further, designing the cathode active material plants to feed the battery plants. And then at the first part of that chain is the refineries to actually make the, materials. Lithium, the nickel the cobalt, manganese So I think, you know, it’s hard to see where the bottleneck might be, but there’s a very large challenge to all of those pieces of the value chain or the supply chain have to converge and be operational at the right time in order to achieve the end goal.

And certainly there’s building and commissioning and operating a refinery is gonna be part of that. Algebra, I would say to meet the supply needs. And yeah the supply chain for the refineries includes, you know, not only the engineering and supply of the systems the work that my company does, but also the sub-components that go into those plants, the centrifuges, the compressors, the dryers.

 I think it will be a challenge to do all of that efficiently.

Antoine Walter: So what you’re saying is that it’s not one critical path with one bottleneck, but it’s a succession of different critical paths and potentially more than one bottleneck. So you have to really plan that out thoughtfully.

Jim Rieke: much so. And, you see the you know, the car manufacturers. On the end of that chain, getting very involved in each step through investments through equity positions, through off-take agreements. I guess to say again the algebra of that calculation is very complex and the planning required to make sure there are no bottlenecks.

So all of that supply lines up properly.

Antoine Walter: There are two more routes to lithium. One where I’m pretty sure you are involved and one where if I’m right, you’re not involved. Those two additional routes would be lithium recycling. And there, I think you already have active stuff ongoing. And the other would be direct lithium extraction where I didn’t see you having a footprint there.

is it right already and then maybe if we start with recycling, what do you do in that field?

Jim Rieke: Veolia has been involved with recycling? Veolia, it does have battery recycling plants.

And they are looking to further move up the value chain with those by not just recycling batteries, but also purifying the black mass results. And actually producing materials that can be reused cathode materials.

Antoine Walter: So does that mean that Veolia H P D is acting as a service provider to Veolia waste and hence upgrading the plan so that you can extract valuable materials from the black mess?

Jim Rieke: That’s the intention. We haven’t gotten to that point yet with Veolia, but Veolia HPD is active with other battery recyclers exactly that uh, lifecycle, for example. Exactly. We’ve supplied Evaporation and crystallization equipment to be installed in one of their hubs.

And that plant is currently under construction.

Antoine Walter: that’s one more route. And what about the D L E route?

Jim Rieke: The DLE route with Veolia and Veolia HP D group. have our own DLE technology, but there are many companies out there that are developing such technology and we are. Involved with projects where we would be engineering and supplying the equipment downstream of the DLE to take the upgraded lithium eluent that comes from those systems and further concentrate that purify it and crystallize either lithium carbonate or lithium hydroxide from that stream.

Antoine Walter: So you would be a post-treatment to DLE operators, which enable them to go to battery grade.

Jim Rieke: Correct,

Antoine Walter: You mentioned that you don’t have in-house technology for that. Yet Sues wts. So the portion of Sues, which is now part of Veolia used to be active with their membrane division and in several projects I crossed them in South America at least. Does that mean that it’s might become part of your lithium portfolio at some point?

Jim Rieke: it could be you know, I mentioned that earlier that Suez, and Veolia have a lot of complimentary technologies and certainly the former Suez as was very strong in the membrane area. So you see a lot of these flow schemes. Require or utilize membranes for that initial concentration of the lithium once it’s recovered from whatever resource is feeding the facility. you could see d l e becoming part of our portfolio, but it most likely just because it’s very specialized and sometimes specific to a certain feed brine most likely will be a third party. Unit operation that’s integrated into a Veolia facility or a Veolia design. And we would just provide a system that included that as a piece, but likely procured from a third party.

Antoine Walter: So, you know, I have this backstory project, which is a bit the start of my lithium deep dive, which is that. Just next to the Houma. I grew up there is a source of lithium. I make you read the short version of that story, in DAOs Brine, there is 300 to 400 And so I was wondering who would be the right people to address if I was to say I want to switch gears and I stop my podcast thing and I go really

Jim Rieke: is

Antoine Walter: a lithium extraction. So if I get your rights, I would need to look for a D L E company and you might be able then to supply me with a refining step.

Jim Rieke: Correct. Yeah. Four three or 400 ppm, lithium, without a d l E technology, it would be, probably uneconomical to try to recover that. But that’s the benefit of these D l e systems that have been. Developed in recent years is all of a sudden there’s much more lithium that’s available in the world to be recovered in an efficient way. So yeah, , that would be the likely path for you to develop your 400 PPM lithium source is a D l E provider that has a demonstrated technology. They would probably do a little demonstration plant to show that can be concentrated to say, two or 3000, 4,000 PPM through their technology.

And the d l E technology usually not only concentrates the lithium, but it also purifies it during that step. and then once that, brine is. Concentrated and purified a bit. That’s where Velia could take over and through the more conventional unit operations that we have in our toolbox put together a system that further concentrates, purifies, and ultimately crystallize and, produce either lithium carbonate or lithium hydroxide.

Antoine Walter: As you mentioned, this new development of d l E opens many new sources of lithium, which is great on one end, but if you are a developer , like me in that example, it means a lot of competition. Which also means I have to be fast to market. if I want to secure that, you can deliver me my refining step.

How early do I have to place a bid? And what is the timeline between the moment where we sign an agreement that you will refine my Lithium and the moment where it is commercially producing lithium in South Zes.

Jim Rieke: Oh, I would say The first thing that we always want to achieve as a, design freeze, a process design freeze. So you’ll see in a lot of these. Projects that we’ve been involved with. it takes six or seven years from the time we first make contact with the client to that commissioning process.

But a large part of that often is doing the design work testing that allows you to validate a flow sheet and achieve design freeze.

Once you have a frozen design. Then you can move that process into the detailed engineering phase, which then leads to procurement and construction. So from process design, freeze through construction to commissioning, that lead time is maybe two and a half years, I would say, as a typical, and I think as we through the industry. Have more learnings on, the different flow sheets that are available to move a certain brine or a certain clay or a certain hard rock a lithium hydroxide or a carbonate product. The more experienced the industry has, the quicker we can achieve that process design freeze.

Antoine Walter: So that is one aspect of the story. The other aspect of the story is that if you. Can extract as much value as possible along the process you probably shall do it. And you mentioned how there’s one byproduct, which is calcium hydroxide. Are there more byproducts along the re refining value chain? And how do you valorize those byproduct and how do you extract them?

Jim Rieke: Correct. Yeah. in these processes, there’s usually some byproducts just due to the chemical reagents that you use in order to convert the lithium to the final form that you, you wish to use, whether it’s lithium hydroxide or lithium carbonate. The byproducts that result it.

For example, in the Naraha plant, one of the byproducts is calcium carbonate. carbonate as its lime mud, essentially normally doesn’t have a lot of value. One of the unique things about the Naraha plant though, that again I think is something that could be applied elsewhere and it fits into Veolia’s corporate mission is Recovering that and recycling that.

So at the Naraha plant, the calcium carbonate is recals, signed through a lime kiln and converted back into active lime that can then be used at the front of the process. that’s one way, or one byproduct, and one way to valorize that byproduct in the spodumene path that we discussed. A byproduct of that process as sodium sulfate. Sodium sulfate is, it’s a commodity chemical that’s used around the world. A lot of it in the detergent industry for solid detergents. So there is a use for that. But with more and more of these refineries that are coming online there will be more and more sodium sulfate To utilize and the existing marketplace might be stress.

So there’s various processes as well that Veolia has to valorize sodium sulfate, one of which is a conversion of sodium sulfate to potassium sulfate, which is a specialty fertilizer one that switch is quite beneficial Compared to other fertilizers and that it’s low in chloride. So it’s better for the environment than conventional potassium chloride fertilizers. So that’s one path of valorization of sodium sulfate. And then Veolia is also has a technology that converts the sodium sulfate back into sodium hydroxide and sulfuric acid so that it can be recycled.

Directly into the plant and offset fresh makeup of those chemicals.

Antoine Walter: You just mentioned several technologies which you have in house. So I’m wondering if, now I take my business hat, what is the special sauce of Veolia? Is it this constellation of technologies that really you can address whatever part of the process you’re gonna have? Whether something in-house or the know-how to take a third party?

Is it the process warranty? You mentioned a bit earlier in the conversation, is it your ability to deal with. Complex and large project. If you have to name just one special sauce, what will it be?

Jim Rieke: Oh, that’s hard because it really is a combination of things.

Antoine Walter: Let’s go for the combination.

Jim Rieke: let’s go over the combination then. Yeah, I, well, I think firstly we have, you know, very smart people that, work at Veolia with a wide range of experience in the chemical processing industries.

So we are able to put together these rather complex processes that, you know, often are first of a kind or have very unique feed stocks. we have the unit operations in our toolbox that we understand very well. So we’re able to put those systems together and optimize those and as well as having the testing facilities to validate those systems and provide process guarantees.

And then we’re a large enough company as well as Veolia to be able to, those systems that are often, 40, 50 million systems we can provide them on a global basis with the full backing of Veolia. process and mechanical guarantees, which is very comforting to our clients, especially some of these players in the battery markets, for example, are smaller companies.

So being able to get those projects financed is a lot more feasible when you have someone like V eolia Providing the process designed.

And then, you know, the capability to do that and look at all the systems holistically, like at the Na as opposed to having a separate third party, maybe an EPC that doesn’t understand that technology, have to put all of those operations together. It just allows us to Provide a more holistic offering and to control the risk a lot better for ourselves and for our clients.

Antoine Walter: Let me try to see if I get that special sauce. so you have people dealing with complexity. That’s one first element. You have the tools in toolbox. You have the testing capability, which enables you to then take process quantities and then you are large, which means that you can be really everywhere worldwide, which makes it easier to finance a project, and your engineering in-house gives you a holistic approach.

Jim Rieke: it’s a pretty good summary. Yeah. Yeah. Thank you.

Antoine Walter: the testing? Does that mean that every project has to come , to plain field at some point, or do you also use the full Veolia network to tap into other facilities?

Jim Rieke: We do use the Veolia network. To tap into other facilities in whether it’s, you know, we have a very strong technical and development group based in Paris that we interface quite a bit with. And now we have the former SUEZ company also has very strong testing capabilities, more on the membrane size that we’re collaborating with. But yeah, when we’re doing. Complex flow sheet development, and most of that for the battery market industry is in Plainfield. But not all of that has to be tested. It’s only when there’s a gap in our understanding or a special chemistry that we’re not familiar with that, we’ll wanna do some validation testing.

Antoine Walter: What is the size of V H HPD today?

Jim Rieke: Our group is about 200 people. There’s about 150 located in the Plainfield office, and we have another satellite office in Bilbao, Spain that has similar capabilities but we collaborate very closely and they just geographically are better able to service the European area.

Antoine Walter: And what would be the turnover that business unit of 200 people?

Jim Rieke: turnover is, you know, 150 to 200 million per year.

Antoine Walter: that makes for a good tour of your word at Veolia HPD. So really thank you for the openness. And you didn’t. me back on any of my tricky questions. Even when I tried to figure out what we were doing in Australia, which maybe was secret, apparently, hopefully not.

Jim Rieke: No, I mean, Australia, there’s so much going on and there always has been in the mining industry, especially in Perth it’s like a, center of mining activities. So number of things happening out there, a number of potential clients, and we’ve had a big presence there for many years.

Antoine Walter: Well, thanks for that deep dive, if that’s fine for you. I propose you to switch to the last section, which is the rapid for questions.

Jim Rieke: Okay.

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Rapid fire questions:

Antoine Walter: So in that section, I try to keep the question short, and you are supposed to keep the answers short, but you can also take more time on never cutting the microphone.

And you’ll notice that the one which is always sidetracking is me. My first question is, what is the most exciting project you’ve been working on and why?

Jim Rieke: Yeah, I think we’ve covered this. The most exciting project has been the Naraha plant, you know, just because it’s the, I guess, the most recent one that started and the commissioning went so well when I think it’s a great story for the industry. How quickly it started. I’ll say there’s a close second.

We’re working with energy Source on a project in California which is a D L E project that’s removing lithium from geothermal brine. And Veolia would be providing all the downstream equipment there as well as for that particular facility, operating the facility. So hopefully will be commissioned in a couple of years that we’re just moving into the construction process hopefully soon.

Antoine Walter: California, is that the Salton Sea or is it another project?

Jim Rieke: Salton Sea. Yes, correct.

Antoine Walter: Okay. I heard that’s the most tricky one and you solved it.

Jim Rieke: Yeah. The tricky part I think is managing the geothermal brine which, you know, has very high temperature. It has some scaling compounds. The good thing about that facility is Source actually operates and has operated that plant for a while and knows very well the characteristics of that brine.

And they’ve developed their own d l E technology, which is you know, they have a long period of demonstration on that particular brine with their technology. So I think it’s after you get through the dle, the downstream part is more conventional equipment that. Veolia is very good at providing

Antoine Walter: I warned you about the sidetrack, sir.

Jim Rieke: Yeah, I know.

Sorry. And I’ll talk a lot too, and so we can get ourselves into trouble.

Antoine Walter: I have one more in the sidetrack, which is, you mentioned Canada and there’s this mining area around Quebec and basically not so far from playing field. Is that something you’re looking into?

Jim Rieke: Yes. Yeah, it is. we have a couple of clients up in that area as well in That we’re in, in, I guess, various stages of the project with for sping conversion from those facilities. And that Beckon core area up near Montreal is very active. Not only with. Refining, but also Cam p cams.

And again that’s I think the Quebec government trying to incentivize that sort of activity.

Antoine Walter: Sorry for a set for the sidetrack. Let’s go back to the main track. Can you name one thing that you’ve learned the hard way?

Jim Rieke: Through my career. The things that are, the big learnings are the hard learnings. You know, the ones that may be a little bit painful, and these often happen during commissioning process. But I guess o one key learning is that it’s usually not the things that you are worried about that trip you up in, in these complex flow schemes. Sometimes they’re rather simple things that, cause the most delay or heartache. So it’s really kind of makes you focus on being very thorough all aspects of these projects and not just the ones that seem to be the most tricky.

Antoine Walter: I think that’s a very valuable one. Thank you. Is there something you’re doing today in your job that you will not be doing in 10 years?

Jim Rieke: That’s a good question. Probably maybe I won’t be typing as much. I think with advances in, in technology. But otherwise, I, you know, I don’t know that my job’s gonna change too much in the next 10 years, and I think That’s what I like about it. There’s a lot of variety and with chemical engineering and you know, building these refineries it’s basic principles and, you know, the equipment will be similar.

You know, maybe the technology that allows us to the engineering more efficiently or communicate more efficiently will be different. But I think more or less I’ll be doing mostly the same things.

Antoine Walter: What is the trend to watch out for, be it in h HPDs core sector or in the water sector more broadly speaking.

Jim Rieke: Trend to watch out for. I think you’ll see more focus on recycle and recovery of these byproducts. I think that will become more evident thing that needs to be addressed as some of these plants start to be commissioned. And those byproducts need to be valorized somehow or disposed of. And the trend, I think will be to, vary with a lot of focus to try to avoid disposal and to instead find a way to, to recycle or reuse.

Antoine Walter: I really want to prevent starting a new sidetrack here, but it’s a fascinating one, which we’ve discussed several times on that microphone, because having the technology to recover a byproduct is one thing, but you need to create the value chain and to have full system in place so that once you’ve recovered something, it’s the ones you mentioned like potasium sulfate or sodium hydroxide, that then you can.

Really bring them along that path, and I guess that’s the thing we have to build going forward. If we want to go into this circularity.

Jim Rieke: Yeah, correct. It’s another one of these challenges where there’s some algebra to be done on how to make it all work in an economic fashion. But, the drivers will be there, I think, and I think society will demand it as well. So, you know, it’ll be a combination of the refiners The battery manufacturers the car companies all will have to to make that a priority and to find those I guess the, path to market to reutilize those byproducts.

Antoine Walter: Last question, would you have someone to recommend me that I should definitely invite on that microphone as soon as possible?

Jim Rieke: Boy, that’s a tough one. I would try to get maybe someone from one of the higher up the value chain, one of the people from a, one of the car companies perhaps would be interesting, I think, to see how they’re, how they see the. The marketplace and their activities through that value chain that we discussed previously and how they’re involved throughout those steps.

Antoine Walter: sent a Twitch to El Musk, but he wasn’t available. Huh?

Jim Rieke: That would be a key. Yeah, if you could get him on the show, that would be great.

Antoine Walter: actually all jokes aside I just looked at the valuation of several lithium companies and you have a couple of them which are valued at roughly the same amount than Twitter and would I have been in his shoes? I would rather have both one of these companies than Twitter, but I’m no one to do and I’m certainly not in his shoes, so, yeah.

Jim Rieke: Well, I, you know, it’s funny you mentioned him if you have a, an opportunity, they just I guess publish their master plan three which I think Tesla does occasionally they’ll talk about, Not short term goals, but some of the longer term objectives. And, I think Tesla does plan to be more involved in that supply chain as a, producer of EV cars wanting to make sure that they have a secure supply of cathode materials. That’s. I think they’re very focused on, on that side of the business, so that, that would be a fascinating discussion. But I think all the other car companies are thinking similarly just in order to secure the commitments that they’ve made five, 10 years from now to produce those cars.

Antoine Walter: Makes sense. Well, Jim, it’s been a pleasure to spend that hour with you. If people want to follow up with you, where shall I redirect them? The best.

Jim Rieke: Yeah, they can contact me on LinkedIn or through email at@jim.rickyviola.com.

Antoine Walter: I’ll put the links to both your email and your LinkedIn profile in the show notes. So if you’re listening to that, just go have a look at the show notes and you’ll find everything there. Well, thanks for your time and I hope to get to speak to you again in the future when you commission your first D l e refining plant, because that might be the reference I have to visit for my own project.

Jim Rieke: That would be great.

Antoine Walter: thanks a lot.

Jim Rieke: It’s been my pleasure.

Other Episodes:

FREDsense: Revolutionizing Water Quality Monitoring with Biosensor Innovation

By Antoine Walter | 7 May 2025

Swirltex: Revolutionizing Wastewater Treatment with Bubbly Innovation

By Antoine Walter | 30 April 2025

Blue Foot Membranes: The Next Evolution in Water Filtration

By Antoine Walter | 16 April 2025

Echo River Capital: Pioneering the Future of Water Innovation

By Antoine Walter | 3 April 2025

1001 Fontaines: Engineering Sustainable Water Access Through Social Entrepreneurship

By Antoine Walter | 22 March 2025

Amazon’s Water Footprint: Tech Giant’s Quest for Water Sustainability

By Antoine Walter | 19 March 2025

Turing: The AI Revolution Quenching the Water Industry’s Thirst for Innovation

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Botanical Water Technologies: Harvesting Liquid Gold from Plants

By Antoine Walter | 4 December 2024

The post How ‘Reverse ZLD’ made the World’s Largest Water Company a Lithium Refinery Expert appeared first on (don't) Waste Water.

Find out more with my entire Lithium deep dive.

with Robert Mintak – CEO of Standard Lithium

Standard Lithium coins itself America’s 21st century Lithium Company. They’re expected to become the first lithium developer in the World to produce direct-extracted lithium at a commercial scale in El Dorado

Full Video

What we covered:

5⃣ How Standard Lithium built a plan to grow to commercial direct lithium extraction (DLE) scale in five years

How you can’t take lithium extraction processes off-the-shelf and how you can’t copy-paste what works on a lab scale for a commercial scale

How there’s an overlooked part of DLE: managing high brine volumes and flows

How Standard Lithium “surprised” Lanxess with a lithium add-on to their bromine business

How you need to know what you know but also know when to team up and get support to take your project off the ground

How Standard Lithium used a simple trick most companies wouldn’t dare to apply: paying their partner to kick things off

How the Lanxess project will serve as a Blueprint for replication across Arkansas’ Smackover formation

How there’s no silver-bullet universal lithium extraction process and how you need to tailor it to your regional parameters

How to be future-proof and keep all options open to the evolutions in battery technology

Why El Dorado, Arkansas is the absolute best place to build a lithium chemical business in North America

How having a positive impact and walking the talk is key to be serious about supporting the energy transition and the EV Revolution

Fluid handling as a boring but necessary evil, developing win-win agreements, relationships to Koch Engineering and Lanxess, California and further Arkansas projects… and much more!

… and of course, we concluded with the 𝙧𝙖𝙥𝙞𝙙 𝙛𝙞𝙧𝙚 𝙦𝙪𝙚𝙨𝙩𝙞𝙤𝙣𝙨  

Resources:

Come say hi to Robert on Linkedin 

Check Standard Lithium’s website 

is on Linkedin

Antoine Walter on LinkedIn

Teaser 1 – DLE Secret #3 – Mastering the boring stuff such as Fluid Handling

Teaser 2 – DLE Secret #9 – Pick the Right Base Camp – Why El Dorado is the best place

Teaser 3 – DLE Secret #2 – A tailor-made extraction process (& why there’s no silver bullet)

Teaser 4 – DLE Secret #1 – De-Risking your Lithium project with a clear master plan

Full Transcript:

These are computer-generated, so expect some typos

Download my Latest Book - for Free!

Antoine Walter: So, hi Robert. Welcome to the show!

Robert Mintak: Thank you. I really appreciate your interest in Standard Lithium and the opportunity to participate. Always love to talk about what we’re doing!

Antoine Walter: Well, thank you for hosting me in your beautiful and scenic Vancouver offices.

Robert Mintak: It is beautiful today, you came on a lucky day.

We can see the gross mountain with fresh snow there. It’s indeed a gorgeous day here.

How Standard Lithium got involved in… Lithium

Antoine Walter: I’ve looked a bit at your history with Standard Lithium, and you joined the company in 2017, so roughly six years ago. The company changed its name shortly before that. It transitioned from petroleum to lithium; if I’m right, that’s what I found online.

So to me it sounded like transitioning from black oil to white oil. An interesting move, right?

Robert Mintak: That name change or change of business was prior to my joining the company. It was a public company before, and that is how many of the Canadian resource companies evolve from one industry like energy into mining.

You’ll see mining companies that have gone through a transition and become blockchain or a marijuana companies. So it’s a process with public companies in the junior sector doing what they call RTOs. Reverse takeovers, where you do a transition.

Robert Mintak and Andy Robinson cut their teeth at Pure Energy Minerals

Prior to standard lithium, I was at another lithium company called Pure Energy Minerals, along with my business associate, Andy Robinson, who joined Standard Lithium in 2017. And we’ve developed the company since then.

Andy and I were at Pure Energy Minerals before Standard Lithium, where we cut our teeth on direct lithium extraction. The lessons we learned there were instrumental in how we approached how we would build Standard Lithium.

Antoine Walter: I will come back to DLE in a minute. But you mentioned your previous role, you were not “just there,” you were also named Canada’s top mining company. So you were very successful there, right?

Robert Mintak: I’ll take the compliment. We were fortunate we were in a very attractive space as well, the lithium sector, so you get a lot of attention, uh, it being in the right sector, so that’s very helpful as well. Um, and having projects that were at the right point in time as well.

And having projects that were at the right point in time as well. So I’ll take the compliment but also recognize the sector’s growth. Announcements coming from Tesla lift all boats!. That plays a lot into it as well.

Under Robert Mintak’s lead, Standard Lithium multiplied its value by 6

Antoine Walter: Building on that success, I’m a muggle, I’m a water guy, so I’m looking at financials. I understand half of them. Take it with a pinch of salt.

But over your six years as a leader of Standard Lithium, as the CEO here, you multiply the value of the company by six as well. So is it just a, peaceful road, or are there some hiccups on that road?

Robert Mintak: There’s lots of hiccups. Everything’s a challenge when you’re building something basically from scratch. Yet, let me reveal the first of our DLE Secrets:

DLE Secret #1 – De-Risking Your Project

We had a very clear business plan when we started though, and that was to develop a series of projects where we have addressed and as best we can, remove many of the risks that get in the way of actually successfully taking a project from conception into hopefully delivering a successful commercial enterprise.

That was critical to the business strategy, and that was not to chase discoveries, so not to look to make them a new high-grade discovery on a new resource that hadn’t been looked at before, which can be great to be if you’re a geologist, to make the hall of fame for making a discovery.

But those come with the challenges of no infrastructure and all of the other permitting things, items that can derail projects.

So we intentionally set a business plan in place where we could develop a lithium project, where we were able to aspirationally look at a timeline to get into production within five years.

We haven’t achieved that (we didn’t plan the global pandemic). But it was to find a project where we removed discovery risk, where we removed infrastructure risk, where we removed geopolitical risk, where we removed many of the permitting and social license aspects.

Picking the right race and the right horse

And all credit to Andy, he chose South Arkansas as his target. It wasn’t in the company’s portfolio of projects when we took over Standard Lithium, but it was where Andy said: “that is the best place to build a lithium brine project.” And then utilizing what we learned at Pure Energy Minerals from the DLE or applying a selective or modern processing methodology to the project, not coming with an ideology that we had to utilize that, but looking at all of those aspects and where we’d be able to do that.

A lot of the success over the last six years has been luck as well, right? Timing in the sector, the right timing and project partners that we hadn’t identified earlier on. But they almost fell into our lap! Nurturing those relationships and ensuring that we delivered on what we said we would. Those aspects have been key to our success.

We still have a lot of work to do, but having the business plan, choosing the right jurisdiction, assembling a team of agnostic technical experts across a diverse skillsets, and then having the good fortune of being in the right place at the right time.

Staying DLE agnostic in the first place

Antoine Walter: There’s a lot to unpack in all of that. Let me try to check; if I understand you right, that means you have to be agnostic and be quite open to any kind of DLE?

Robert Mintak: Yes. The DLE aspect, it’s a project that we chose, and the reason we stayed in North America was to remove the geopolitical challenges for brine resources, specifically that you find in South America. There’s lots of great projects there, don’t get me wrong. And they, they’re moving forward and they’re success on them, but we wanted to avoid a lot of the headaches that you face on those.

Lithium brine is what we were working on previously at Pure Energy and felt comfortable working towards finding projects where we could take what we learned with that. And the only way in any brine project in North America, you are looking to build successfully. You have to use unconventional process.

There’s a small brine resource in Nevada, but you’ll never get evaporation ponds permitted anywhere in the United States. And Canada… you can’t evaporate here.

That leads us to our second DLE Secret:

DLE Secret #2 – A Tailor-Made Extraction Process

So utilizing a selective extraction process would be critical for that. But understanding that you have to have a process that’s fully integrated for the resource that you’re looking to develop, not developing a process and then trying to plug it in or force it to work on your project.

I see. So those were some of the things we learned when we were at Pure Energy, cuz we were working with external vendors or technology providers is, uh, a lot of academic work. There’s a lot of startups, any, uh, large companies working on how you can try new ways of lithium extraction from Bryant. But you can’t take someone’s pre-packaged extraction process and then try to make it work on your project.

You have to. Take the project parameters, the chemistry, all aspects of it and work backwards and then trial different processes and a lot of brine and projects will work great on tabletop, but can you actually scale them and make them work at a commercial scale?

Scaling up DLE to commercial scale is where Standard Lithium is a World pioneer

Antoine Walter: The scaling up to the commercial scale is absolutely the reason why I wanted to speak with you because I’ve been told by market experts that if someone can make it happen, this DLE at commercial scale, it’s going to be Standard Lithium and it’s gonna be your Lanxess project.

Maybe others might do it in the future, hopefully for that sector, but you are expected to be the first company to manage that. So is that because of this approach of you’ve learned it somewhat the hard way and then you decided to move out the permitting out of the equation because you went on the sites where permits were, uh, given what’s the special trick?

Robert Mintak: Yeah, that’s where the luck came in or the good fortune in that we have been able to deploy our time and most of the capital we’ve raised on. Advancing an integrated process, not having to throw tens of millions of dollars into developing the resource and having to get the permits and then do the drilling and all of the reservoir development work to define whether you actually have a viable lithium asset to develop.

Starting up a success story at Lanxess’ site in El Dorado, Arkansas

We were able to utilize the relationship that we developed with Lanxess and plug into their existing brine operations and put all of our attention on doing the hard work required to operate a process for sufficient time to learn what you need to understand for operating process, optimizing it.

Equipment choices, running it for sufficient time to understand the reagent costs, reagent losses, your energy, and all of the consumables that go into the process. And then try test another aspects of it.

So you can define the most effective process when you make that decision to scale to commercial. So we’ve had that benefit where we’re actually working inside an operating facility that processes thousands of gallons of brine per minute and pumps it to the surface, runs it through the pipeline network, treats the brine, removes a mineral from it, and then runs it through another network for reinjection that’s overlooked on the DLE landscape. Actually, that’s probably DLE secret number three!

DLE Secret #3 – Mastering the Boring Stuff

When people talk about applying DLE on projects, that’s a significant amount of capital requirements expertise over and above being able to figure out how to get the lithium out. So we benefited from Lanxess, managing that. And we can focus on the core aspect of how do we get the lithium out consistently every day to produce a high purity lithium chloride solution that we can then convert to lithium carbonate, having them do all of the heavy lifting on the brine supply and disposal.

So that has put us in a unique position anywhere globally. I think as a developer, I wish the best to all of our peers working on DLE processes, but they have to do all that heavy lifting, put all that money in the ground, and give investors confidence that they’ll be able to manage all of that infrastructure and operational risk as they scale up.

Where with the relationship we’ve developed with Lanxess and for our first projects, it’s a handoff. They provide the brine, and we’ll be taking the lithium and converting it to battery-quality lithium carbonate, but we’ll be handing back the brine to them for disposal. So that’s where we’re at.

An advantage foot being the most likely to move into commercial development because of all of that infrastructure and risk that we’ve removed from the scale-up and the operation of the first project.

Standard Lithium got Lanxess to help with the “Boring Stuff”

Antoine Walter: You mentioned Lanxess, just to clarify, that’s your flagship project, which is quite a funny encounter in El Dorado.

Robert Mintak: El Dorado. It’s a unique Arkansas pronunciation. Rhymes with “tornado” is how you remember it.

Antoine Walter: It’s a bromine production site, right?

Robert Mintak: So just for go back in history, the reason we chose Arkansas, actually the Gulf Coast of the United States sits on one of the largest brine aquifers globally called the Smackover formation.

The region has a mining history that can be leveraged

It extends some central Texas all the way to the Florida panhandle’s about a thousand kilometers from east to west, and it’s dozens and dozens of miles wide, hundreds of meters thick.

It’s a deep aquifer. Seven to 8,000 feet deep in South Arkansas was discovered in the 1920s when they discovered oil in South Arkansas. When they would drill a deep well, they would get a lot of produced water and it was a nuisance. For the energy industry, for the oil and gas industry. And then the late 1950s, Murphy Oil and the Arkansas Geological Society were able to figure out that it was rich with bromine.

So they worked together to combine their skills and develop a bromine industry in South Arkansas. Based on the oil and gas industry, the bromine industry in South Arkansas was developed. And then as bromine became, the flame retardant globally used across all industries became an important industry Almar.

World’s largest lithium producer has large operations in South Arkansas. They were formerly known as Ethyl Corp. LAIs Now, uh, and Almar operate very large brine processing facilities for bromine production. LAIs bought that asset in South Arkansas in 2017 with the purchase of Chemtura to get into the bromine business.

Arkansas already deals with 5 billion gallons of brine a year

But yeah, Arkansas produces north of 5 billion gallons of brine annually, cross Albermarle and Lanxess for a bromine production. And then that same brine is re-injected into the aquifer. The U s Gs and others have published a lot of technical data saying it is the highest reported lithium concentration in brine in North America been known for decades.

Dow Chemicals developed the first broadly used direct lithium extraction process in the late 1970s and utilizing brine from the MCO formation. So that process that was patented in the late seventies by Dow version of that is used by liven in Argentina. Okay. And then Almar ran a pilot plant in 2011 at their bromine facilities for lithium extraction.

Andy had all of this information and it was one of the primary reasons we chose Arkansas because that discovery risk removed and that brine industry existed where you can pump and re-inject because that’s critical when you’re looking at applying aact extraction process. Doesn’t matter how great the resource is if you don’t have the ability to reinject it.

And that is critical and it gets overlooked on the DLE side that not every salar has the conditions so that you can pump and reinject with either the reinjection not depleting your resource or impacting your fresh water, or spending a lot of time holding hands and explaining to the communities and the permitting regulatory groups on how you’re gonna do that.

And that can be years and years time to get there. So Arkansas, you come with that advantage.

The World long didn’t need Lithium

Antoine Walter: So there was this existing. Industry and nobody was really extracting that lithium. So do you proactively go to Lanxess and say, we have an idea?

Robert Mintak: Well, the world didn’t need the lithium for a long time.

Right. The great resources in Chile in Australia had been able to supply global demand and novel processes may have worked, but the low-hanging fruit in the Atacama and in Australia had easily supplied everything we needed. But, and that’s where that timing came in for us. We didn’t have a business plan where we would say we were gonna go and approach Langis to do a development deal with them.

When we took over the company in 2017, we had a very small project in California, in Bristol Lake. That was an interesting project. It came with standard Lithium, and I took that over. It’s a, an existing mining operation for calcium chloride. They use brine from the mohabi. Pump surface and use solar evaporation.

We came down to California to look at how we could develop a lithium industry off of an existing permanent asset in California, and we were lucky again in that one of the operators in California was a company called Tetra Technologies. So we approached them and we entered into an agreement where we were gonna be able to leverage their California permits to investigate whether we could build a lithium business off of their calcium chloride brine.

Entering Arkansas from… California

As we were developing the relationship with Tetra, we recognized that they had a large brine asset in Arkansas that they hadn’t developed. So again, this is all good luck and fortune that shined on us. It wasn’t part of our business plan. So as we advanced the development and relationship with Tetra, we were able to leverage that relationship and get an agreement in place.

So that we could get access to their brine leases in Arkansas. Our California asset allowed us to develop a relationship with Tetra. We secured a large brine asset in Arkansas. And the reason Tetra had never developed those leases that they were holding in Arkansas that they had for several decades, was that they had a brine tolling arrangement with Kimura, the company that Langs has bought.

Mm-hmm. Where they were getting brine after bromine extraction, and they had a small plant where they could produce calcium chloride. So through Tetra, we recognized that Kimura at the time was allowing commercial contracts to get brine after bromine extraction prior to Reinjection for their mineral recovery.

So that light bulb went off. That was an opportunity that we had now a relationship with Tetra, a large lease package in Arkansas, and we approached Chemtura with a business plan, which was to do similar to what Tetra was doing. So taking their tail brine, post bromine extraction and looking at, we’re covering the lithium from that. And this leads us to our DLE Secret number four

DLE Secret #4 Finding Synergies

While we were in dialogue with Kimura at the time, Lanxess acquired them, everything was good Fortune, lithium space was in a very strong position in 2017 when we were doing this. Lanxess was buying a bromine asset. They weren’t buying a lithium business. So we surprised them with the, “you’ve got lithium in your brine.”

And they recognized members of our technical team that Andy had assembled from experts that they use globally across some of their water businesses. So I’m speaking from my own, my own perspective, not on their behalf. They recognized that we had a strong technical team and that we didn’t come to them saying, we have an idea.

It was, would like to try different ways to get the lithium out, take brine, bring it back to our research facilities in Canada and start to unlock this resource. And they were open and receptive to that idea.

Antoine Walter: So at that stage you, you have that brine where you know there’s a good portion of lithium in it, you know that you have to go for DLE, but you also know that all the parameters are set so that DLE is possible cuz you can reinject the brine.

But nevertheless you still have a broad range of possible DLEs to pick from. So you have to select the right ones. How do you start that process, and what got you to choose the process?

Defining the right DLE for that particular Brine

Robert Mintak: That’s where Andy and our agnostic technical team come in and they are across a variety of industries.

Several of the team members worked with us previously at Pure Energy. And have decades of experience in ion exchange. And mineral Hydrometallurgy and other processes. Craig Brown, Ron Maar, among others, are based in Southern Ontario, and we were able to, with the relationship we developed with Lanxess, take thousands of liters of brine from their production facilities and send them to our team in Ontario and they got to work trialing number of off the shelf processes, not commercial, but offered processes from startups and from existing technology providers and trialing other ones that we were able to access different materials to do that process work.

And then we went through those tests, and then we developed our own process based on the brine chemistry, temperature of the brine, and then also the other permitting requirements for what reagents you can operate with within the chemistry and the reinjection parameters in Arkansas. So that’s how we’ve developed our own process and then have integrated other elements into the process.

The Key Competence: Fluid Handling

So that DLE is the heart of the process, the selective extraction, but what’s overlooked by analysts and commentators is it has to be a completely integrated process. There’s a number of different ways to get lithium out of brine. You need to find a way that does it with the highest efficiencies and in the conditions of the chemistry that you’re working with, but you’re doing it 24 hours a day, every minute of every hour of the day.

At commercial scale, thousands of gallons per minute need to come into your facility and it needs to operate in a way that at two o’clock in the morning, an operator is gonna make sure that the plant is running and it’s if there is an issue that it’s addressable.

So the pre-treatment stage is critically important. The selective extraction stage, the stripping stage, every aspect, removing novelty from that as best you can, and using industrial processes that you have confidence in. That’s critical. On the DLE side, it’s one aspect to get the high recovery of selective extraction, but can you do it Christmas Eve at two o’clock in the morning when you’ve got a half a dozen employees working?

The your plant is different than just doing it, you know, for a batch process. So having that integrated process and then developing it and scaling it up. At each stage where you learn from those aspects, that’s the critical part. So start to finish the d l E aspect is critical, the heart of it, but the entire process, every element has to talk to each other.

Operators need to know how to run the plant, your equipment choices, a pump, sensors, all of the other elements. That requires a lot more than that initial scale up and testing work we did for our process is how we integrated that into a larger brine operation is the the critical step. So that’s the learnings that you have to make.

How to define Standard Lithium’s role in that story

Antoine Walter: How would you define your work as standard lithium into that? Are you an integrator of these technologies? Are you one part of the technology which enhances with these other technologies?

Robert Mintak: Yeah, that’s a great question. The project drives the process. Mm-hmm. Again, so we’re a project developer and hopefully a commercial operator soon, but developing the project holistically, so not sole technology developer, certain core aspects that need to be tailored or bespoke for the project, that if we’re able to own that IP ourselves are gonna be beneficial.

But you also need to balance it against what the scale up risk and proving a process that can be commercialized. So we benefit from working in Arkansas where they’ve been running brine for 60 years now. We benefit from having, you know, with Langis and the predecessor companies, that confidence in certain.

Elements of the flow sheet and then other aspects specific to lithium. The lithium sector is moving quite rapidly now. There are certain process components that you can integrate from existing brine operations, the post extraction stages where you need to purify your lithium chloride into consistently high purity final product.

DLE Secret #5 – Teaming Up

Integrating those into your process as you scale it up so that you have made the necessary test works so that you’re producing a final material that’ll go through those final stages. Mm-hmm. So long way of answering your question is developing processes that are required, but integrating as many standard or processes so that you will have a successful start-to-finish recovery process as opposed to the job of just developing the the process.

It’s more choosing the right equipment and having industrial expertise across that. So we have team members who come from the water treatment industry, which is very helpful cuz it’s brine. That we’re working with, but that provides expertise in the pre-treatment and the controls that are chosen.

Processes that we use also overlap with. Some of our team members come from the pulp and paper industry. Mm-hmm. Which you might not think is a good fit, but liquid solid separation. They know to cantor and they know different ways of managing liquid solid separation. And then just bringing in strong partners, startup companies, and we’re doing the best we can to avoid this, is to check your ego and hubris that we can do everything.

Why not? Bring in strong partners who’ve built things before and have experience across a variety of industries who can integrate their expertise, their scalability, into your process. So know what you know, know when to bring in the help required to make the project successful.

Standard Lithium partnered with Lanxess and Koch Engineering

Antoine Walter: Talking of this partnerships on that specific Lanxess project or smackover, I don’t know what’s your internal name for it?

Robert Mintak: All of the projects we’re focused on are from projects utilizing brine from the Smackover formation. The two projects we have now, the Langis project in the Southwest Arkansas project, the resource by chemistry is by and large the same. So the broader development will be across the smackover, but the projects are separated, specifically the length of projects are there brine that we will utilize from.

The leases that they have under their control. The Southwest Arkansas project is a standalone project, and we’re also doing a significant resource expansion program to bring on more resources across the smackover as well.

Antoine Walter: So I keep calling it Lanxess. On that Lanxess project, you’ve been partnering with external companies, some of them being also close partners to you, like Koch Engineering?

Koch does the pre-treatment for you and then you focus on the DLE, right?

Robert Mintak: Well, we’ve been responsible for all the costs associated in developing the project to date, and that’s probably our next DLE Secret.

DLE Secret #6 – Dare and Trust your Destiny

We paid Lanxess to actually work with them. So we didn’t do what a lot of companies do, which is to come up with an idea and try and get funding from a larger partner.

We paid them to allow us to get access to their facilities, be able to publish resource reports, and to work pretty much exclusively on lithium with them. That initial investment or payment we made to them has allowed us to move much quicker, leverage their infrastructure. And do all of the steps, as you said, to make us the company most likely to succeed on DLE.

The relationship with Koch started with us beginning outreach for a strategic investor that also brought more than just an investment, brought broad industry expertise mm-hmm. Across a number of businesses. And we spent a good 17 months looking to find that right investor and strategic partner. Uh, we spent better part of nine months.

Working with Koch to define their expectations and ours, which made them a very large shareholder of Standard Lithium. They made a hundred million investment in December, 2021. And with that investment and the time we spent with both companies getting to know each other, we recognized that they had an extremely successful and very good fit on the brine processing or water treatment business.

Koch became more than Standard Lithium’s partner

Koch Engineered Solutions and Koch Separation Solutions, they run a global water processing business. They were visiting our facilities. They recognized certain choices we made on equipment. And asked us why we chose certain vendors where they had different offerings that may work as well. So as you highlighted the pre-treatment stage, if we were at our plant in Arkansas today, you would see that Brian pre-treatment goes through a Koch membrane process.

Mm-hmm. We had trialed numerous other membrane or pre-treatment stages, and many of them were successful, but came with significant operating costs or maintenance challenges. Koch pre-treatment process just happens to work better. Koch has been awarded through a competitive bidding process. It wasn’t, uh, just granted to the, the feed study for our first commercial project.

Mm-hmm. And the definitive feasibility study underway. So Koch, OPD optimized process design is an EPC contractor based in Texas. So that’s just another benefit of having not just a good investor, but, but a spreadsheet partner. But, but Ital also, and a complimentary one to Lanxess. So they weren’t a competitor in the chemical business or in the water treatment business.

Teaming up with Koch OPD helped speed up the project

So a complimentary strategic partner. So when a company like Standard Lithium. Which we’re closing in on a hundred full-time equivalent consultants employees, but it would still, it’s quite a reach to go from that into developing the first commercial project. So bringing OPD in as the feasibility and feed design, and then with the mechanisms we put in place on that contract, the ability to convert that to an EPC contract where they will be responsible for delivering an entire wrap on a process.

Start to finish. Rob Ryan coming in, integrating all of the elements of the DLE process, along with the pre-treatment, the polishing, the concentration stage, and the conversion Elysium carbonate underneath a wrap with certain performance guarantees and other aspects that. Reduces and manages a lot of the risk that would be taken on by the company like ours as an owner of a process.

OPD, that’s a whole EPC contracting facility in Texas. Fabricator perfect location for us. It’s in the Gulf Coast. Less than a day’s drive from the project. No one’s built a DLE process like this before, but they have expertise from their other industries as well. So they are a great partner. Especially considering our next DLE Secret!

DLE Secret #7 – Scaling Up

And then their business model is not just building one of something for a client. It’s replicating those and building multiple facilities or multiple projects. So our goal, if we’re successful with the first project, our goal is to build multiple extraction facilities across the smackover formation cuz the chemistry and the hydrogeological conditions is similar.

And we can build them either aggressively or conservatively based on success of course, as the industry requires it. The industry needs a lot of projects to be successful, but we don’t need to try to. Convince investors that we can take a project from scratch to 25,000 or 40,000 tons based on a very small pilot plant.

Our scale up is reasonable, we think, and very responsible, but it isn’t large. It’ll be more than the current US production of Lithium, but it removes that scale up risk As we develop the further projects where that brine and subsurface management will be required, so that as we step out into the second project and the third or fourth projects outside of the Langis facilities, we’ll begin to take that roll on.

But we’ll have removed many of the aspects of the scale up.

DLE Generation 1 vs Generation 2

Antoine Walter: On the integrated extraction process. I’d like to discuss that, that future in your next steps. I have a last question In your DLE process. When he was on that microphone, Ben Sparrow from Saltworks explained the difference between DLE Generation 1 and DLE Generation 2:

Ben Sparrow: DLE Generation 1, which has been around for over 20 years.

It’s an alumina-based absorbent. The lithium-containing water flows by it, so it’s either a powder or a resin bed. Material flows by it, and that absorbent grabs the lithium. So that’s fine but now you need to release the lithium. The way you do that is you stop flowing the brine past the absorbent.

You now flow water past the absorbent. It’s water sorption, so alumina-based water sorption. And it works, and you can very mildly concentrate the lithium, but more importantly, you reject a whole pile of total dissolved solids and salinity. You’re essentially improving the lithium-to-TDS ratio.

Generation two is a different fundamental technology.

That’s where you have a titanate or manganese oxide based absorbent. You, again, flow the lithium brine past it, and it grabs the lithium and it does a better job at grabbing the lithium, but there’s a catch. In order to elute the lithium from the absorbent, you need to wash it with acid.

Thermodynamics, again, kinetics, generation two DLE plants are “quote unquote “hooked on drugs” for many, many years, right? So they have to keep pumping acid into the system. When you pump acid into a system, you lower the pH. That means you then have to add a base to elevate pH. Again, generation two has a very significant advantage in that it can concentrate lithium, it can achieve a higher lithium-to-TDS ratio.

It’s a capital cost smaller plant. But the operating costs are higher because you’re constantly having to elute with acid and then adjust with base.

Standard Lithium’s take at the Gen 1 vs Gen 2 question

Antoine Walter: What’s the route you’ve chosen?

Robert Mintak: At Lanxess our process is a pH-mediated process. We raise the pH to selectively absorb the lithium. We bring it up to a pH neutral condition and lithium’s released in acidic conditions.

Mm-hmm. So we drop the pH. I wouldn’t say one process is better than the other. The project drives the process. There are a number of projects where reagents may be too costly. We would just have any work in the Gulf Coast. It’s chloride capital of North America. Mm-hmm. So you choose your process and your project based on not just what you think is gonna have the highest recovery in a laboratory or in a test tube.

You need to be able to reagent costs and security of supply. The permitting aspects as well. So no process is universal. There’s no silver bullet. There’s a number of processes that you may integrate successfully one or another on the same project, but you have to do that work. And I wouldn’t call ’em generation one or generation two, it’s an evolution.

But also applying them again at the right project.

“Gen 2” – produced lithium Chloride

Antoine Walter: Today the, the demo plant is producing lithium chloride?

Robert Mintak: Yes. So the extraction process produces lithium chloride. And then we do have a carbonate conversion pilot plant on site as well. And we’ve got also a novel lithium hydroxide pilot plant running as well.

But those are early in their development stage. Those two processes, we will be using a vendor, an OEM supplied. Chloride to carbonation plant for our first commercial operation. But the selective extraction produces lithium chloride.

Antoine Walter: And your output is gonna be lithium carbonate?

Robert Mintak: Ultimately for the, with lengthy, lengthy, the arrangements we put in place with them allows them option to acquire all of the carbonate that’s produced on their sites and that everything produced from brine extracted from the LAIs leases will be for the production of ball.

Lanxess can decide to opt-in on the Lithium production

Lithium carbonate At the fixed cost or what’s the, we’re working through the commercial arrangements with them now. So LAIs has two options upon completion of the feasibility study. They can come in as a project partner mm-hmm. And acquire up to 49% of the project company that gives them the right for the lithium carbonate.

At a market-based price, less a sales or handling cost. If they choose not to come in as an equity partner, they still have an option for the lithium carbonate output, cuz we’re utilizing their brine and their infrastructure. And then it is at market-based pricing, less a discount, not to exceed 20%. So they get a win-win.

Either way, we’re de-risking the project for them. They come in as an equity partner. It’s done on a ratable basis with us recovering some of our development costs. And then there’s revenue sharing on the project. If they choose just the offtake, they have a project that’s de-risked, then they get an advantage Pricing.

On the lithium carbon, it’s still very attractive for both parties though.

Choosing the right output

Antoine Walter: Your other Arkansas’s projects is expected to produce lithium hydroxide, right?

Robert Mintak: Yes. Another reason we chose carbon for the first project is lithium brine projects producing lithium chloride produce lithium carbonate commercially now, so it’s far less of a technology risk to add the chloride to hydroxide conversion.

Antoine Walter: That is what’s done in South America right?

Robert Mintak: Yes, they’re doing chloride to carbonate and then they convert carbonate to hydroxide using a, I believe, a wet lining process. So it’s adds additional costs. On our Southwest Arkansas project, we’re looking at a number of ways to produce hydroxide using, uh, electrolysis or uh, an electrochemical cell.

DLE Secret #8 – Being Future-Proof

We’re trial trialing a novel iron exchange process, and then there’s always the chloride carbonate and then the classic wet liming process as well. Hydroxide. Is where we feel we have the most value and the interest that we’re receiving from tier one battery companies, automotive OEMs. For a domestically sourced lithium hydroxide in the United States is incredibly high.

It is almost aggressive. The interest that we’re getting from groups looking to get secure supply. Uh, this stage, it is where I spend most of my time bringing people to the site and talking about our development timeline and our offtake strategies and the interest in getting their foot in the door to secure that is completely different than the lithium environment from two or three years ago.

Down the line: a lithium offtake agreement?

Antoine Walter: We are in downtown Vancouver. Yeah. You have neighbors here. Which a couple of weeks ago got some major investment from a major car manufacturer. Yeah. So is it something similar, which we are discussing here?

Robert Mintak: We’re going to be very careful on the partners we choose. I understand there’s significant interest and what’s most important to us and the reason we working with Lanxess.

The reason we are working with Koch is that we have a long-term vision. Mm-hmm. A business plan to build in stages, facilities across the region. So we’re starting with blank’s phase one A, and then subsequent projects in parallel or sequentially as we build out the resource on the Smackover formation.

It is the only tier one brine resource in North America. There’s geothermal projects and there’s other oil field projects, but none of them can point to the brine lithium concentrations that you have in the Smackover formation. We’re starting at 230 on the lengthy, we’re going up to 460. On the Southwest Arkansas project, and you can just look at the data from the U S G S and others that are purported higher than 500 parts per million in the smackover.

Standard Lithium leverages North America’s best brine

Every other brine in North America is sub 200. Some of them are sub 100, so there’s no reason to look anywhere else. Having a partner that aligns with us on our strategy of developing these resources, a partner that will be using the materials in North America. That’s our primary objective. So we align with a lot of the administration’s policies, but then also allows us the flexibility with the right partner because the lithium chemistries, they may change.

So the advantage we have where we’re working as well, producing a lithium chloride solution, you can take that in multiple different chemistries. You could go to a solid state battery, the lithium chloride solution, you could go carbonate or hydroxide. And then you also have the ability where you don’t have to necessarily locate your conversion facilities on site.

We can look at a centralized or co-locating with the right partner. So those are many of the, uh, questions, but what we’ve identified for bringing in the right partner,

Standard Lithium’s long term vision

Antoine Walter: you’ve referred several times to your business plan and to how all of that aligns with a long-term vision. Yeah. So what’s that long-term vision?

Where do you head with standard lithium? Our

Robert Mintak: objectives is to, to get the first project built. That is the critical one. Or sorry, don’t wanna run before you even walk. Makes sense. Don’t put the cart before the horse. Prove that you can build the first one. But now with the industry’s attention that we’re getting, The administration’s policies coming out of Washington, focusing on developing domestic resources.

There’s an opportunity for us to now be more aggressive as we’re developing these. So the long-term vision we have the two projects under our control now, the Langis and the Southwest Arkansas. Those are combined. If we’re successful, with 50,000 tons of carbonate and hydroxide production, the region can support a multiple of that.

DLE Secret #9 – Pick the right base camp

It is the best location in North America to build a lithium chemicals business. It’s an area where you have a massive lithium resource, tier one lithium brine resource. You have the inputs required to run a lithium brine business or a lithium chemical business. Secure low cost power water is critical on every project.

If you chose a project in an area that’s under extreme drought and water stress conditions, you may have chosen the wrong project to look at. And regardless of the lithium concentrations or how favorable the mining jurisdiction is, because water’s critical. So we’re in an area that’s. Not underwater stress.

You have to be a good steward with water. But this area isn’t underwater stress. We’re in an area with a social license. Very few lithium projects in the United States can point to having support from their local communities. It’s on a blanket statement. You have to earn it, you have to continue that. But this area is familiar, culturally comfortable.

I hope I’m not overreaching on that statement with industries in the chemical and the energy space cuz they’ve been doing it for a hundred years and you’re geographically in the center. Of the country and with access to your markets, either domestically, within a day’s drive or export through the Gulf of Mexico.

So it’s the absolute best place to build a lithium chemicals business with the resource and all of those other aspects. There’s an opportunity, it may not be a standard lithium capturing all of it to produce well north of a hundred thousand tons of lithium chemicals in this region. Building it using responsible extraction processes and developing it as the industry requires it.

Critical for it is to demonstrate you can get the lithium out commercially. That’s our first project, but it’s not a cookie cutter, but it is a replicable process that you can develop. Every project’s gonna face a lot of challenges. We’ll face less of them because of the area we’re

What’s the role of ESG in the Lithium Development process?

Antoine Walter: You mentioned how you have to do it responsibly.

That is, Something which transpires through all your website communication and also what technically you are putting in place so that you just started a pilot for carbon capture. Yeah. So, which I guess goes into that same direction, how important is ESG to your operation? It’s

Robert Mintak: incredibly important. The end users, when we look at the big picture, the materials we’re producing are going into lithium batteries, and the primary driver for battery demand is EVs and stationary storage.

And the consumers, the end users. That’s probably DLE secret n°10.

DLE Secret #10 – Strive to Positively Impact

And the entire rationale as, so we’re going into this new energy economy is to lower your environmental impact. Mm. Everything comes with an impact. If you can lower your environmental impact, that’s critical. So building project, choosing the project location, you have to be critically aware of what your impact is going to be by the nature of the.

Technology, our impact will be smaller, but we still have to be very careful on the reagents we’re using on all of the conditions that we’re operating in. And it’s a chemical industry as well. So health and safety, all aspects of that are critically important. But the outside looking in, if you have a supply chain that’s causing child labor issues coming from Africa and Cobalt, if you’re working on projects that are producing large tailings, having impact on.

First Nations having long-term end of mind life challenges on how you’ll develop them, or infrastructure that you’ll be needing to bring in across fragile ecosystems. It’s a hard argument to win on why you should build those to supply the final product going into a clean energy or an ev. People will say, you know, you’re greenwashing, just, you’re saying you’re put, you’re getting rid of internal combustion engines and.

You just have to give us a pass here cause we’re gonna build this mine and it’s going into a car and that’s the greater good. We’re gonna destroy some fragile ecosystem or an endangered species or a plant that only exists in one part of the world. But you have to, you know, look at the bigger picture. I would have a trouble sleeping on that.

ESG’s impact will rise when the Lithium imbalance will reduce

Antoine Walter: There is an an imbalance between supply and demand in lithium and that imbalance is here to stay. I think by jewelry’s projections, by the end of the decade, you still have that imbalance. And I’m wondering, because I hear all your arguments and I would subscribe to them with my two hands. Makes a lot of sense.

You don’t want to just go out from one trouble to move into the next trouble. But if car companies are desperate for lithium, will they really be looking at ESG?

Robert Mintak: I can only speak from my experience in the dialogues I’ve had with both car companies and tier one battery companies. Is that, is it?

Question. They ask, what’s your water impact? What’s your carbon intensity? Okay, what’s your social license? Whether that at the end of the day stops on from writing a check. I can’t say they’re all in the process now of trying to finally catch up from what the industry has been telling them. For years.

Joe has been extremely loud telling them five years ago, three years ago, that they need to invest upstream and they’re now late to the party. So that may impact them, but definitely you need to be able to accurately define what your impact’s going to be. The other challenge is, doesn’t matter just with the car companies or the battery companies, you still gotta get permitted.

You still have to be able to get through this, those stages. Mm-hmm. Funding a lot of the, the bankable feasibility studies and the, the debt finance, once you get through that and your debt finance providers, they require significant amount of guidance and guarantees on, I don’t know, E S G is the right term for it, but just on your impact and the sustainability specifically on the project, there’s certain.

Protocols that you have to meet to get specific types of funding. It is going to be the limiting factor for the adoption of EVs is the critical mineral supply chain. So that aspect, whether it forces projects that should either have taken longer to build or taken a approach to try and find the cheapest way to build them as opposed to a more sustainable or less impactful way.

We’ll see we’re building our projects in stages and that you mentioned the carbon capture. We were careful in how we’ve defined our impact because until you’ve done the work to know what your energy costs, your energy demand, your mass energy balance that you, you need to build, and then also your water requirements, all of those are understood.

Standard Lithium will build one more synergy on site: they will capture carbon

You shouldn’t talk about how your carbon negative or carbon neutral because that’s only aspirational. So with the carbon capture, we were comfortable last year where we understood where we would have carbon intensity. Mm-hmm. Evaporator, crystallizers use natural gas, so we will have a few flu streams. We were fortunate that we had, with our technical team, a very strong, the ability to begin looking at novel carbon capture processes and ones that would tailor with a flow sheet.

Aqua, uh, Norwegian technology that we’ve invested in now was a nice fit. We’re doing the r and d work now, the testing work to get the data to see if it will be applicable at the commercial scale. Mm-hmm. And we’re working to see whether we can utilize some of the CO2 that we capture within our own flow sheet to replace reagents that we use and or any CO2 that is required.

The bigger opportunity, and this is arm waving, is that we’re moving massive volumes of brine to the surface than re-injecting it. There’s an opportunity with carbon capture to sequester CO2 that we capture from our processes and then the broader. Emitters in the region, cuz it is a large CO2 emitting region from the fertilizer industry, the chemical industry, natural gas in the Gulf region to utilize the technology across other emitters, capture that CO2 and dissolve it into the brine.

When it’s reinjected, a lot of work needs to be done working with the regulatory groups and the other stakeholders in the area, but there’s an opportunity with the brine industry that exists in the Smackover to make it a massive CO2 sync as well. It’s not critical for the lithium business, but we need to identify and manage our own co2.

But there’s an opportunity to, to build an even bigger CO2

Carbon Capture in El Dorado is a pure-positive move

Antoine Walter: management. If understand you write on that one, that means that you have no necessity to do that. It’s about walking the talk and being consistent with your approach and saying you want to have an overall good approach to to things and it might lead into a bigger opportunity because if already you’re trapping CO2 and you have that opportunity to sequester it with your reinjection, then you could be doing good on a.

Bigger scale and doing good at, at a certain point in time, a profit because the carbon price is going

Robert Mintak: up as well. A lot of work needs to be done. I’ll just be very clear. We, we, we need to get all of that work done, but it is based on the work that we identified today. We know where our CO2 footprint will be and we’re gonna do everything we can to reduce or eliminate that.

We just, there’s an additional benefit if we’re successful at that. When you pump the brine back into the aquifer, it needs to be acidified. So you can do that with carbonic acid. Yeah. And it replaces a reagent we use, it’s a carbonate matrix aquifer. I’m, I’m not the geochemist, so hopefully I’m not going off topic or, or saying something incorrectly here, but there’s an opportunity there that can be built upon successful, sustainable lithium extraction where you can add that additional benefit and there may be an opportunity to build a large business of it as

And what about a surprise French Lithium Project?

Antoine Walter: I have a, let’s say, surprise question for you, because I didn’t warn you at the start of that full investigation into lithium. Actually, just in my backyard where I grew up, there is a full network of former potash mines, which closed down at the turn of the 21st century. And when they closed down, they turned that network of potash mines into a landfill, special landfill for special things.

Which ended up burning, and so they had to close the mine. And so now for 20 years there is debates about what to do with that place. That raises a lot of environmental questions, which are off topic, so I’ll leave them off topic for today. But they’ve been looking at the water and they were looking at the water to look if there’s contamination from this waste.

I got hold of this water analytics. What struck me is that there’s a high lithium content, there’s a lot of other stuff, but there’s a pretty high lithium content. Similarities to what you see in ours. So it’s between, I have one of the sample is that 300 ppm and the other sample it’s just 420 ppm.

There’s lot of tds as well. It’s not the perfect brine, but there’s a good lithium to to tedious ratio. So that’s one part of the story. The region where that happens is maybe 50 kilometers away from basil, which is one of the European capitals for chemistry. So you would have the supply of chemistry available.

You are in the middle of the biggest aquifer of Europe, so water is available as much as you want. And electricity. You are in the middle of Europe, so you have a good, great. What I’m trying to paint here is that it sounds, I have no ambitions to opening a litton business. That’s not the aim. But I want to just, you know, as a, as a thoughts exercise to see.

What’s the limits to all of that? Is it something which you would be potentially looking into or do you say No, that’s a different play? We are specialized in what we do in our s, maybe in California, maybe North America, but it would be too much of a stretch to pick maybe even promising project. But so

Robert Mintak: far from our home, we get approached almost weekly with opportunities for oil field brine or processed water with lithium concentration.

Not as high as what you had just said. And we don’t take them on. Most of them are in North America, a lot of them in the Gulf region, not from the Smackover, cuz we don’t have the bandwidths. We have to complete the tasks at hand. We’ve told our partners, our investors, that we’re gonna build this first project and there is no ability to take on new r and d processes.

Right now, looking at our business plan, we’re focused on the resources that we understand. I would. Back of the envelope, get the data from you on that and to find the resource, just using pretty simple calculations if they were available. What you need to understand on the project. Having all of those elements of water, that existing site looking for remediation, may make it attractive to have a development there.

You need to understand the brine production, how much you can actually pump, or is it a lake?

Antoine Walter: It’s an underground aquifer. Yeah. So you are 300 meters

Robert Mintak: down. Yeah, so you would need to do the, we call it Canada 43,000 1 0 1 resource evaluation, which would be poking holes in the ground and doing some pump tests on that just to, to find what the production would be and whether if it’s a process that was a T L E or a selective extraction.

The reinjection aspects of that. Mm-hmm. But that if I wasn’t focused on what we’re building and I was looking for a project with a standalone company, I would definitely take a look at that for sure. I think

Antoine Walter: I, I’m reaching the same conclusion all the time. I have to change my job and now I, I won’t, but that means that for now, what’s really on your agenda is for 2024, do you have the commercial plant?

When is, when do

Robert Mintak: you expect to, well, the targets, I should say feasibility study for phase one A, which is the first langis project, which is gonna be located adjacent to our existing demonstration plant. The feasibility study is targeted to be completed first half of this year. Mm-hmm. And then we’ll go through a process with Langis to have them just determine their option on the, um, project participation on the equity side.

We’re hoping to have all of that completed q3. And be in a limited notice to proceed and final investment decision before the end of the year, which would put us on a construction path through 2024 and 2025. So we’re giving ourselves sufficient padding on the development timeline, subject to everything coming through positively on the feasibility studies.

Just put the global supply chain challenges right now. Mm-hmm. So it’s about a two year build on that. The Southwest Arkansas project is a preliminary feasibility study underway. We’re gonna roll that into a definitive feasibility study, so no gap in time on those. Hopefully that DFS begins in Q3 of this year, and then it’ll be completed probably by mid 2024 if that’s a positive outcome on that definitive feasibility study.

Begin final investment decision before the end of 2024, early 2025. So building them both in parallel and then we’ve got a significant. Expansion program underway in the smackover formation. So acquiring leases, getting samples, doing the necessary resource development work under the, uh, 43 1 0 1 guidelines, and doing all that in parallel as well.

Mm-hmm. So that is, uh, gonna go through 20 23, 20 24, and 2025, so that we’ll have subsequent additional projects to bring online as well, that if we’re successful, this is forward-looking statement. For anybody listening, we’re our target is to have them as orders of similar magnitude to what we’ve got in Arkansas.

So a lot of work, it’s basic, all primarily focused in the region, working with our project partners and bringing in where we can additional expertise to de-risk these subsequent projects. I could push you

Antoine Walter: into further forward looking statement, but I, I won’t do that. So I have to thank you for the very open, deep dive and the very open conversation.

Oh, you’re welcome. I have a couple of rapid fire questions to round that off. Okay. If that’s fine with you. Yeah.

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Rapid fire questions:

Antoine Walter: start with one, which I had intended to ask you in the beginning, but we jumped into the conversation and actually I just spotted that one of your scientific advisors happens to be a twice Nobel Prize laureate. How cool is that?

Robert Mintak: Yeah, no, that’s incredibly cool.

We’re very, we’re blessed with our scientific advisory team. Um, as I mentioned, we’ve got them across a number of industries. One specifically PEs Jason Hein. Who’s been working with us on our novel carbonation process. He’s based in Vancouver. He comes from the pharmaceutical industry. We were introduced to Jason in 2017.

He helped us, uh, develop the sift selective ion filtration technology, which we believe will be a next generation carbonation process. His mentor was Barry Sharpless, professor Barry Sharpless. So Barry had won Nobel Prize at that time. Uh, and we were fortunate because of Jason’s relationship that be, uh, Barry was more than eager to join us and as, as available as required to help with novel chemistry process problems and had the benefit of meeting him at Jason’s wedding.

I was at a loss of words of anything to say to him cuz he is next level. Um, he is incredibly generous with his time. And then he’s additionally, yeah, the, the second Nobel Prize, there’s only five people that have. Ever won two Nobel Prizes and he’s the only living person with two Nobel Prizes as well.

Yeah, no, he’s, we’re extremely fortunate just with the relationship with, uh, professor Hn and then, uh, Barry’s relationship with him. We let Jason, professor Hn do the communications with, uh, Barry, because yeah, he’s works on our next level, but Professor Hn, um, is also probably one of the most brilliant scientists on the planet.

If you ask Professor Sharpless who he thinks is one of the smartest people on the planet, he’ll name Jason as someone that he thinks is, is a standout across the chemical engineering industry. I’ll take you to

Antoine Walter: more conventional rep for questions. So my next one would be, what is the most exciting project you’ve been working on

Robert Mintak: and wide outside of Standard Lithium, I’m teaching myself how to play the Theon.

Wow, that’s cool. Yeah. Well, it’s very difficult. My wife made, made me take it to the office and she wouldn’t let me practice at home cuz I was driving the dog crazy. That’s a cool one.

Antoine Walter: One thing that you’ve learned the hard way. Oh, just one.

Robert Mintak: Oh, everything I’ve learned has been the hard way. I’ve had to learn the lithium industry.

As you and I were having a brief conversation earlier that my education background doesn’t come from the chemical industry side or even the, the geology side has, uh, been a crook across a number of industries. Is there something

Antoine Walter: you’re doing today in your job that you won’t be doing in 10

Robert Mintak: years?

Traveling, this is on the road, uh, 150 nights last year. Been on the road for, I think, uh, 40 nights this year. So far, almost every, you know, four or five nights a week have been on the road this year, so hopefully traveling less. What’s

Antoine Walter: the trend to watch out for in your sector?

Robert Mintak: The attention that’s being paid to the US domestic supply and how that is going to play out with the Inflation Reduction Act and how important building domestic projects will be and the administration’s policies.

I don’t think it’s been fully grasped by analysts, investors. It’s, it’s an incredible opportunity right now to build projects that. We’ll feed into the onshoring ideologies or principles that are underway Right now. Every project’s got challenges. The global mining industry needs to reinvent itself, but the US projects specifically and as a Canadian talking about the US projects, but the policies that are coming online from the US and they’re forcing the Europeans and other countries to adopt them will reset the way that the global resources have been primarily focused or driven by China.

This onshoring principles that, uh, the administration in Washington is pushing, it’s forcing. The Canadians do similar and the Europeans are looking at it and saying, we need to also adapt. I think that is probably the most exciting

Antoine Walter: trend I have. The last one, would you have someone which you would recommend me to have on that microphone as soon as

Robert Mintak: possible?

Yeah. My associate, Andy Robinson, Dr. Andy Robinson, he’s probably, if not the top, in the top two on the direct lithium extraction globally. He’s done the work over the last eight years between pure energy and standard lithium. He’s easily the most level-headed non-emotional when he is talking about certain aspects.

Um, very pragmatic. I would, I would definitely recommend getting, uh, and on not just a plug for standard lithium, but uh, he knows the direct lithium extraction and, and generally the resource development space is good or better than anyone.

Antoine Walter: I’d be very happy to, to have him. Yeah. Thanks so much. You’re welcome.

All the time. You, you spent with me, I could have pushed you with 10 more questions, but I already went over time, so I’m sorry for that. That’s okay. But it was really pleasure to have you and thanks a lot for, for you

share.

Robert Mintak: Thank you very much.

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The post What are the 10 simple secrets behind Standard Lithium’s DLE success? appeared first on (don't) Waste Water.

Find out more with my entire Lithium deep dive.

with Tony Strobbe – EV supply chain Projects Director

Every Monday, Tony compiles a dedicated content piece he shares on LinkedIn that covers one aspect of that said supply chain

What we covered:

How there are no electric vehicles without batteries, no batteries without lithium, and no lithium without some kind of mining, hence you have to build a supply chain

How the closer you are to your customer, the higher the margins for your product, and the consequences this has on the lithium mining vertical

How car manufacturers could well end up being left without lithium if they donc tackle the challenge seriously

2⃣ How there are two ways to approach the vertical, from the bottom and from the top and where those two paths cross and meet

How the large lithium companies currently “printing money” have two paths to continue doing so, and which one is probably the best for them

What are the material requirements to process one ton of spodumene and turn it into battery-grade lithium carbonate or hydroxide

How ESG considerations will impact the lithium value chain today and tomorrow

What parameters to consider when conceiving and building a lithium refinery and where to ideally locate it

How geopolitics and history shape the current and future lithium markets

How there may well be a Powerpoint path to lithium equilibrium, but how the devil lies in the execution

How DLE deals with a hot soup, and how this comes with its own challenges

Lithium offer and demand, high prices solving high prices, the shelf life of Lithium Hydroxide, shipping spodumene across the World, extracting as much value as possible locally, lithium from new sources… and much more!

… and of course, we concluded with the 𝙧𝙖𝙥𝙞𝙙 𝙛𝙞𝙧𝙚 𝙦𝙪𝙚𝙨𝙩𝙞𝙤𝙣𝙨  

Resources:

Come say hi to Tony on Linkedin

is on Linkedin

Antoine Walter on LinkedIn

Infographic: Lithium 101

Teaser

Full Transcript:

These are computer-generated, so expect some typos

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Antoine Walter: Hi Tony. Welcome to the show.

Tony Strobbe: Hello, how are you?

Antoine Walter: Well, excited . I’m really excited about the conversation we’re about to have for many reasons, because I think you are filling a void within my series on the lithium world, value chain, whatever you want to call it, but also because I’m usually opening this show with a postcard and you’re sending a postcard from Mexico, and I really don’t know anything.

I never was to Mexico. So what can you tell me about Mexico that I would ignore by now?

Tony Strobbe: Well, Mexico, like you say it’s a beautiful country. I like being here, that’s for sure. It’s also an exciting country because it’s not like Europe where the companies are already settled. It’s basically still Evolving, let’s say certainly in the lithium industry.

But I’m sure we’ll talk about it later.

Antoine Walter: Well, actually, if I can be curious to start with, if I’m right you’re, you’re from Belgium, so how do you end up in Mexico?

Tony Strobbe: Ooh, long story. But basically if you look at my story since I was young, I was very interested in the world around me.

When I was 10, for instance, I remember spending my Sunday mornings at my grandma house and basically right across the street there was an industrial laundry. I really like to go in there and look at the machinery. The machinery were turning around in hot steam very noisy. The machines were running without interference of people. I would say that’s also where it started my interest in machinery, in productions. And basically when I was 15, I had to choose my education.

It was 1984, long time ago. I know. But that was also when the computers came up, so that was a technology that was really new. I know for some of your readers, they will not understand that a world without computers is actually possible, but that was my youth without computers. But that first year the computers came around is also the first year that actually computer technology classes were introduced. So I went to follow computer technology.

And after my computer technology I went further and go in my engineering degree where I started electrical and mechanical engineering. Now, directly after my studies, I was able to join the firm where I did my thesis. And basically for my these I had to develop a machine that actually Tested tires under a specific load, forklift tires. And when I started working, they asked me to build a machine and actually to implement it in their plant in Sri Lanka.

So I went to Sri Lanka and built a plant there. When I did that actually I always continued to look for Projects like that because I liked it so much. And that’s actually how the ball starts is rolling, I would say

Antoine Walter: so you got attracted to this word of building and starting up factories.

Tony Strobbe: yes. And also, basically I’m very curious about everything that goes around me. , Curious about places in the world, but also curious about something new, something exciting that I don’t know about. That’s what I like.

Antoine Walter: So something which you wouldn’t know about, I guess a couple years ago, and that’s my transition to lithium might have been this word of electric vehicles. So what got you into this topic?

Tony Strobbe: Well, like I say, I was interested in a lot of things. I started with computer technology and then internet came in the late nineties. Then basically at uh, around 2010, electric vehicles came with the rise of Tesla. And quite frankly, it interest me a lot. So I start learning about it, reading about it, and , in 2020, as we all know, the world changed a bit and I certainly had a lot of time on my hands. what I did was I start. Deep diving. , like, you say deep diving in the world of lithium and electric vehicle supply chain, actually, and I still do that at the moment. So that’s how I started.

Antoine Walter: well, you are making me the smoothest of all transitions towards the deep dive because what caught my attention first in you’re sharing and you’re sharing a lot of lithium related content on your LinkedIn feed is you are sharing a map of Europe with few points. And saying basically, it’s great to have a plan to develop gigga factories.

It’s great to have a plan towards electric vehicles, but it sounds like we are missing a link in the chain, which is the lithium refineries. So what’s the problem there and what is the biggest challenge Europe would have to overcome with regards to those refine.

Tony Strobbe: In my view, the biggest challenge now to overcome is basically the EV supply chain in europe but also in the states is really in, in the baby shoes. I mean, there is not much as you stated It all happens in Asia and China for the moment, but that’s changing rapidly.

They started with the push to electric vehicles, but you don’t have electric vehicles without batteries. You don’t have lithium batteries. Without lithium, you don’t have lithium without mining. So you need to start up that whole supply chain, basically what you have now, the biggest challenge in Europe and also in the US is getting started, it’s. CapEx heavy industry. So there’s a lot of money that needs to be invested , in an industry that not much people understand.

So you have a little bit of wild west, you have the big names like Volkswagen all known. They have really good experience, but you have also a lot of gold diggers in the field that say, okay, let’s start up a battery factory company it can’t be that difficult, right? And we see where it goes. Well, sometime it go good, sometime it goes bad. So that’s a little bit the issue we have right now.

Antoine Walter: So what happens when it goes bad? I’ve seen you covering quite extensively the British Volt story, so I guess that’s an example of it

Tony Strobbe: Yes. British Volt is going bad. I knew that from the beginning. I was interested in British Volt from the beginning 2019. They don’t have a product, they don’t have a supply chain set up, so they don’t know where the raw materials need to come from. They don’t have customers, they don’t have money, and quite frankly, they don’t have the expertise of building a plant like that and running it. But they want money.

So me as an investor. Okay, what can go wrong? A lot. I think. It was from the beginning. It was a no-brainer for me. I tried to explain that but eventually chose another way and they said, no, we going, gonna do it by ourselves. Well, with, well, the results we have right?

Antoine Walter: So, so that’s this battery word, which is usually the one which gets the light. I mean, you hear about the Giga factories, you hear about those projects, and Europe has been quite bragging about how fast it’s developing. Its battery production. The next link in the chain the one I was mentioning in the beginning.

So this refining. Maybe also the lithium extraction is something which is fully lost to the specialist. I mean, if you’re a specialist you know about it. If you’re a layman, that is a foreign World. So is it a topic where people should be diving in and do decision makers dive in sufficiently, or do they just take it for granted when it’s not?

Tony Strobbe: For the last years, I think it was taken for granted and said, okay, it will happen. But quite frankly the OEMs the car manufacturers, let’s say they see it’s not happening and because the money isn’t there.

That’s a little bit the issue and what you’re seeing right now is it’s obvious that the mining industry let’s start first with where the margin is made, the closer you get to a customer. The bigger the margins is of your product you make. So it makes sense for a mining company that actually produces spodumene which lithium is derived from. To go into lithium refining, you see that. You also see that with companies like Li Vent, Albemarle. SQM, the big players in the mining industry.

What you will not see is actually the car manufacturers going back in the chain and developing batteries. The battery manufacturer developing lithium refineries and going back, because quite frankly, if they have a hundred million to invest, it’s better to invest in something that is closer to the end customer than farther away from the customer.

Now I hear you thinking, all right. That’s not correct because Volkswagen has actually invested heavily in Northvolt for instance. Northvolt is a giga factory operator. And NorthVolt is investing heavily in Aurora with makes with startup lithium refinery in So what is happening over there?

Well, they don’t want to invest, but they have to because a car manufacturing without the batteries, you have a nice , car plant, but basically you have no raw materials to build cars. So that’s a little bit what they say. Hang on, we need to do something and we need to help build up that supply chain in order for us to be able to make electric vehicles.

And that’s what you see with Volkswagen, investing in NorthVolt, investing in Aurora, and so on.

Antoine Walter: there’s a lot , to unpack in what you just said. It makes me think of, I think 50 or 60 years ago, Ford was investing in rubber plantations because they found out that they couldn’t build the tires they needed, so they had to go upstream. And the example of Volkswagen is interesting.

One might say it’s the great direction. What you might also say, it’s a bit late to move into that because everybody talks about the lithium supply chain issue, which is gonna last over the next decade. So at some points there won’t be lithium for everybody. But Volkswagen’s made the move.

What about the Tesla of this word, which maybe didn’t go upstream yet?

Tony Strobbe: That’s an interesting question. And it’s hard to look in the mind of a guy like Elon Musk because he’s a special guy. I mean, he does things that’s no others, more let’s say traditional entrepreneur does.

So I don’t know what will happen, but basically I think , he will be very hesitant to move into the market of mining because quite frankly, if you look into the supply chain and you start from the first step mining it’s bulk material handling.

Lithium refining is also pretty much bulk material handling, so they’re very common. Although lithium refining is more specialty chemicals part of the industry, but it’s also bulk materials.

Now, if you go a step further and do battery manufacturing, the first step of battery manufacturing where you actually make the electrodes, you mix up materials and that’s also bulk material handling.

The second step of battery manufacturing, when you have the anodes and the cathodes and basically you roll them up and you start packing them. It’s more pick and place. It’s more like a car, manufacturing assembly line, and then the car manufacture is also assembly line, of course.

So you have a pretty. Obvious for me divide somewhere in the battery. So basically what you’re seeing is mining will go into lithium refining, but not so much in battery manufacturing. While car manufacturing might go into battery manufacturing, but not further down to lithium refining because it’s a different ball game. And I think Tesla Mr. Musk also. Acknowledge that is basically it’s something completely weird for him. That’s what I think. On the other hand of the spectrum, after the car manufacturing, you have also the recycling, because that’s something we tend to forget. But also here we have the same, you have first you have the dismantling of the pack.

That’s automation, that’s pick and place pretty much close to what the car manufacturing does. And then you grind the modules up into a black mass whenever you have the black mass. Then it also, and it becomes back bulk match material handling. And that’s the circle supply chain we’d speak about.

Antoine Walter: so there are two types of knowhow. There’s the assembly and disassembly knowhow, which would start middle of the battery chain up to the car and then dismantle the battery again. And you have this chemical play, which is from mining up to refining up to the electrolyte and the first step of battery.

If I look at the numbers today The biggest lithium supplier in the world is Australia. I mean, they are mining the spodumene, and then only 5% of the spodumene in the world is refined in Australia. So the big chunk goes in ships and goes to China to get refined. I’ve looked, that’s the beauty of having publicly traded companies.

I’ve looked up the quarterly reports of Albermarle, Pilbara, and all these big players. And over the past year they’ve basically been printing money. They have incredible EBITDA Is it the right time for them to go that step up in the value chain and to say: we have money in our hands so we can finance the CapEx. Let’s go into Refining!

Tony Strobbe: Well, I think there’s no better time than today. Actually, the better time was yesterday. For them, quite frankly. You say Albermarle, SQM, Ganfe ng and Tianxi, that’s are the other two big ones. Basically they have cash.

Everybody know that and they are pretty much the only ones that have cash enough to take up an undertaking like that. Free on hand cash, so they don’t need to borrow a lot. They have two options in my view that basically open up another mine and mine more lithium, or like I said, go up into the supply chain. And add some value to the product they’re having right now. What you need to understand here is basically to open a lithium mine, it costs a lot of money.

Same like a refinery, but it takes a lot of years because the biggest problem they will have is actually to get the permitting done. To permit a mine, a new mine, it takes at least seven years more in the 15 years or something like that. To start up an open mine. So when you see that with the progress is going on right now into the EV, you see that basically 15 years. that’s a long time from now. And quite frankly, now is the time to go ahead in the ev in the electric vehicle supply chain. So when you have. Cash right now, it’s quicker to go in the lithium refining. And that’s what you’re seeing already.

There is a lithium refinery being built. Albemarle is going that way. That’s what you see.

Antoine Walter: you mentioned these timelines, but still hard rock mining is the section which moves the faster from the various ways to extract lithium. So when I started this deep dive into lithium, I was expecting mining to be almost something. Like the way we were doing in the nineties, but outdated.

And I was expecting that, evaporation pond and direct lithium extraction would be the real deal. And the more I look into it, the more it sounds I was absolutely wrong with that statement. It sounds like mining. Despite being slow, it’s still fast enough to be the right horse to bet on.

Whereas Evaporation Ponds, there’s still not one single gram of lithium produced in Bolivia, which just shows that it is not that straightforward to extract lithium from brine. So how can you explain this dichotomy?

Tony Strobbe: Well, basically, I mean, mining will be with us forever. If you need minerals from the ground, you need minerals from the ground how you get ’em out. For lithium would say, Evaporation ponds, that’s basically the cheapest method to get lithium. But it takes a long time.

I do not know if it makes economical sense because what you do is you pump up water from deep into the ground. You let it sit there for two years, 18 months, two years, and then you scoop it up and you have lithium, you refine it a bit. You change it a bit, the lithium chloride and then goes up to the supply chain. I think. mining is basically here to stay, to make it short. that’s my view.

Antoine Walter: you mentioned. Having the cash, the companies will go into this refining, and you mentioned how it is close enough for them to feel confident, but still there’s a difference between having. Big trucks and digging up the soil and running a chemical plant and refining lithium. So is it really that straightforward? Is there like a booklet which says how to build a spodumene refinery?

Or do you still need some technical deep know-how adapted to every kind of soil , or input?

Tony Strobbe: Well, the process of refining lithium and lithium hydroxide and lithium carbonate is a well known process. They do it for 50 or 60 years, not supplying the. the. , Then, but basically lithium is also used in ceramics and glass and in a lot of other industries. So it’s a well known process.

The trick is basically you know the process, but for batteries, you need to have lithium, a hydroxide with a purity of 99.95%, not 99.5, but 99.95%. That’s a high purity. And basically, as we all know, what comes out is a function of what goes in. So if you need a high purity output, then you need to have a stable input. And that’s where the trick is. I mean, the difficulty is not , in producing lithium hydroxide, but the difficulty is producing lithium hydroxyde with that kind of purity all the time.

I mean, it’s a continuous process. So you have spodumene, but basically spodumene from . One mine is different from spodumene, from another mine. If you get your spodumene or your raw materials from a trader, Who knows, the tra mix different minings. So you will see that in, in your process and you will see that in the purity and also in the purity of the end product.

And that’s where it’s tricky and that’s a difference between mining and refining. Refining is very much process control. You need to be on top of your process. And if something changes a bit. I say humidity or the temperature changes a bit. You need to be able to adapt the process just a little bit to get that high purity.

Antoine Walter: Talking of that process, I’ve seen you decomposing that process into the various steps. Can we just take them step by step for the layman, so for me, so that we really get what we’re discussing here.

Tony Strobbe: Sure. I mean, the. first step is basically the calcination step. What you’re doing then is you get spodumene as a raw material, right? Spodumene concentrate, SC6. It’s called SC6. It’s basically the 6% is 6% lithium and 94%. Pretty much useless. I wouldn’t say completely useless. You still can sell it. But 94% rock.

Now the spodumene that comes in is called Alpha spodumene. And that needs to be transferred in the Beta spodumene. The reason for that is when you do calcination at high temperature 800 to 1050 degrees, what you’re doing is basically the volume increases of the spodumene alpha and the spodumene alpha transforms in the spodumene beta.

And that goes with the 30% volume increase. So the lithium that is hiding in all the crevices, in all the little holes, let’s say in the spodumene, the whole spodumene becomes bigger in volume, 30%, but also the holes become bigger. So it’s much easier to get the lithium out of the holes and you get more lithium out.

That’s why they do it. And that’s actually the first step. If you need to visualize the first step. The first step is actually a li, a big blow torch. Blowing natural gas. You burn natural gas into a kiln, and you heat up the, that’s one is basically that goes a little bit more onto that.

But for laymen, that’s what it’s.

Antoine Walter: Absolutely clear. So that’s step one.

Tony Strobbe: The second step, what you’re doing is now you have the lithium, you’re gonna roast it at temperatures at 250 degrees. You’re gonna roast the lithium, acid roasting it’s called, and with acid roasting, you going get lithium out of in a solution, let’s say. And you get, you extract the lithium.

Now what you do is with acid roasting, you extract the lithium , you dissolve the lithium, but also you dissolve the other minerals like magnesium, calcium impurities, I call them. And that’s basically the third step is, All of that removing the impurities.

You do that by water leeching oxidation, ion exchange… There are various steps in that. But basically the main thing is you get the impurities out. So you have lithium by the end.

Now the fourth step is basically the lithium is not , in solid form, so you need to get the water out. So you gonna dehydrate it. You need to crystallize it. So make solids out of it. And the crystallizing, because you have such a high purity, 99.95%, you need to crystallize it twice and after that you have lithium

Antoine Walter: I was reading henry Sanderson. I just wrote his book, Volt Rush. And in his book he mentions how to get one ton of lithium. You need two tons of coal. Here. It might be gas or it might be, it sounds like a fossil fuel intensive process.

Is that a concern?

Tony Strobbe: Well basically to process one ton of spodumene, you need 1.5 GigaJoule of natural gas, one GigaJoule of electricity, 24 tons of water, and half a ton of sulfuric acid and sodium ash.

So it’s quite energy intensive. Yes, that’s a concern. A lithium refinery, in addition to that process, the process generates a lot of inprocessed dust and has the potential of concentrating heavy metals in byproducts and waste. So environmental issues, yeah, you have it and you need to be concerned. About that.

That’s also a concern for the refineries, by the way, in general. Special chemicals facility has not only the bottom line to think about, but also their reputation. So basically that means the recuperation of materials, heat, water, chemicals, solid waste disposal instead of liquid waste disposal at both, it is a must economically, but also environmentally.

Antoine Walter: You mentioned this byproduct, these heavy metals and waste. How is it treat?

Tony Strobbe: Well, basically what they do is they make solid waste. Well, I hope they do it. I mean, the 18 refineries in Europe, I talk about at this point there’s only one. That will start operation by the end of this year and in 17 other ones, it’s still in planning phase, so I don’t know what they’re gonna do, but if they’re smart they take a good look at heat recuperation. They take a good look and water recuperation. And they take a really good looking waste disposal and they try to avoid liquid waste, but go into solid waste.

Antoine Walter: The reason why I’m asking is that when I was discussing with several of the experts, I got to speak for that deep dive, many mentioned me the importance of ESG and the importance of looking at the impact of the process. And I’ve seen that you shared an article about a way to trace the origin of lithium by looking at really the chemical characteristics.

And if now I try really to be mean and to be the devil’s advocate in a market where demands. Is far above supply. I fear that ESG will become an afterthought and whatever lithium you can get, you just get it.

Tony Strobbe: I share your concern there. But basically what I think is now that they get whatever lithium might get is fine enough. Yes, at this point. But it won’t stay that way. What you will see is the supply of lithium will catch up. The demand of lithium will go down because new chemistries will become available.

I’m sure about that. And at a certain point, I will be an equilibrium or even an oversupply. And then they will start to looking at that, I believe, I hope!

But yeah, for now it is a concern. I mean, they speak also a lot about the cobalt. As you well know, cobalt is coming from the Congo.

Where yeah, there are concerns environmental concerns, but all social concerns, and still they get the cobalt from the Congo. They don’t change that. There’s a reason for it. If the cobalt is in the Congo, the cobalt is in the Congo, I mean, what can you do?

You have a valid concern there. But quite frankly The thing we are having right now, I know the European Union is working on a battery passport which tracks all the raw materials and basically the life cycle from lithium mine, all the way to recycling. I think that’s a really step , in the right direction.

Antoine Walter: I’m just coming back to something you said before, which I, I took a note and I’d like to be sure I got it right to, to produce one ton of lithium, you need half a ton of sulfuric acid. Did I get that one right?

Tony Strobbe: To process one ton of spodumene. So it’s even it’s even less you get less lithium the half ton of sulfuric acid and sodium ash. But yeah, you have it right.

Antoine Walter: Because Giga Joules I get it. You get connected to the grid or you get connected to a pipe and you get it delivered. But to my knowledge, there’s no network of sulfuric acid. So, Does that mean it’s produced onsite or how is it done?

Tony Strobbe: I bet they buy it. I mean, how is it done now in the chemical industry, the chemicals you can’t produce on site basically you buy it and then, and you go from there.

Antoine Walter: Okay, so you have a gigantic supply of asset, which is..

Tony Strobbe: Sometimes that’s overlooked. The logistics are huge in a refinery. A typical refinery that produces 24,000 tons of lithium hydroxide a year. That’s basically one train. The logistics to get all the products in and out.

I mean, they are huge. There are, I would say, tens of thousands of trucks if you do it with trucks, tens of thousands of trucks. So you need to have a location close to your port so you can ship the spodumene or whatever you want to use in by ship. The best thing you need to have is basically a train to ship in the chemicals and so on and so, but yeah it’s a gigantic undertaking. Don’t underestimate it.

Antoine Walter: That’s a very good dot. You’re helping me connecting here because I was wondering, when I was reviewing this quarterly report from Albermarle, I think, or it was maybe SQM, one of the two and one of the. Fields they were looking into is doing road trains. Like it looks like a train, but it’s on the road. And I was wondering why is a mining company looking into transportation now?

It makes much more sense. And the other thing is I’ve been looking into 59. Project, which are in the pipeline of production at some point of lithium in the next 10 years. And I was surprised to see how they put on the same level, the richness in spodumene or the richness of their brine and the fact that they’re close to a road or close to a highway or to I mean this kind of transportation facility.

But now it makes a ton of sense.

Tony Strobbe: if they wanna build a refinery and let’s say Munich or in a place where I live a small place and suddenly you have 20,000 trucks a year coming past to, a local road well that’s environmentally is not the friendliest, but also socially. You will have a lot of Resistance from the local population, which is understandable. So that’s why you see refineries popping up close to the shore, close to railroads. If I see plants to build a uh, refinery in the middle of nowhere I immediately I’m suspicious about what they gonna do there. I mean, it doesn’t make sense.

Antoine Walter: Now, you know, I feel a bit like playing risk. I dunno if you know that game where you’re just putting things on the map and there’s a geopolitical aspect to it, which I’d like to discuss later. But just before we go into that, I’m thinking if I can put my refineries wherever I want. It seems to make more sense to make them directly on the mine because that means I’m shipping something which is much more compact instead of shipping.

SC6, which is more concentrated than direct supply of ore, but which is still very bulky.

Tony Strobbe: Well, you have a point, and that’s basically a decision. It’s also the geopolitical sites don’t forget that. I mean, if you have your country running on 50 years ago, let’s say your country is running on oil. If you don’t have oil, You right. You can get into a crisis like in 1976, I believe where Saudi Arabia said, well, we are not gonna deliver no more oil.

So with the batteries it’ll be the same. It’s not for nothing that European has labeled several minerals of the battery supply chain as strategic materials. So there is certainly a geopolitical side on it. On the other hand, If you have a refinery, you can build it close to the mine, but you can also build it close to the battery manufacturing. Now you need to know that lithium hydroxide is, well, actually lithium is really reactive to water. Lithium hydroxide has a shelf life. I don’t know if you know about that, but basically after six to eight months, it’s diminishes a lot in quality. You don’t want that for a battery because if you diminish the raw materials in quality, the battery the energy density and all those and the cycle things will also diminish.

You don’t want that, so you want to have a fresh product. If you like. Lithium Hydroxide, if you make it in, let’s say Australia, put it on a ship and ship it all the way to Europe, it’s six weeks on the sea. Well, as you know, the sea is very wet. That’s not good for lithium. hydroxide.

Lithium hydroxide reacts really well, let’s say with water, even the water in the air, it reacts to that. So shipping it by six weeks over the sea, it will have an impact on the quality.

That’s basically a plus to build a refinery close to the battery factories in Europe. On the other hand, you’re absolutely right if you ship spodumene concentrate across the ocean, you ship 6% what you want, and 9 4% what you don’t want.

Now, there is an intermediate. And that’s basically a company in the UK does that. I won’t tell the company, but basically what they gonna do is close to the mine. They’re gonna build a factory that produces lithium sulfate. And the lithium sulfate is then transported to. You still have a, a waste, but the waste is much less than all the or e.

Antoine Walter: It’s interesting because you really have all these shades of gray because you have the ones which are doing direct supply of ore, especially these new African projects which are in development and some projects in Northern Australia. You have the shipment of SC6

have the lithium sulfate, you have refining onsite and sending abroad.

So it’s fascinating. I’d never heard of this shelf life of lithium hydroxide, so thanks a lot for that one. You really bring an interesting new link in the chain.

you opened the box of geopolitics and that sounds like something which goes beyond what we’ve seen so far, which is economy, e s g, practical concerns with the she life of hydroxide. It’s a bit about what happened if the main supplier of lithium side all of a sudden is not my friend anymore.

Seen those concerns in many countries. My question here is what is the right scale when it comes to geopolitics? Is it like Europe, America’s, China, or is it even more specific that maybe Canada has to take its safeties as compared to the us?

Tony Strobbe: that’s a difficult question for me to ask cuz I’m not a politician. But I would say that the scale NATO countries for instance, I mean, on that scale, I believe there are two aspects on this. First the geopolitical Thing, but it’s also an aspect of the countries like Bolivia, Mexico where I am Argentina, Chile, they want to have as much value out of that as possible.

So what they’re trying to do is basically they want to build the lithium refineries close to the mine. Preferably also built the cars here, built the cars in Argentina, and then shipped the cars all over the world, which obviously is not the right thing to do in my view.

But. that’s a little concern because quite frankly, what they don’t wanna do is they don’t wanna create another colonial age, like in the 17 hundreds where all the countries in Africa basically were mined empty, and the raw materials were shipped to the developed countries, let’s say Europe .

to be processed into more valuable stuff. They, wanna do as much as possible in land. You see that what Zimbabwe is doing right now in Zambia.

Antoine Walter: , to that extent. I’m curious to get your view on, you mentioned Mexico, which to me is a good example because the biggest development project in Mexico is 50% owned by Ganfeng, maybe even more than 50%. I’m not sure. Which means it is a Chinese asset. In Mexico. So if you’re entering in a trade war for whatever reason, between the US and China, would they accept lithium coming from Mexico?

If it is a Chinese lithium

Tony Strobbe: I,

I dunno. What I do know is Ganfeng who is starting up the Sonora mine here in Mexico. They will support their, or to China. I mean China for now is I believe 68% of the products from lithium France come from China, but they only have 21% of the lithium in house.

So it needs to come from somewhere. And that somewhere is, mines like Ganfeng like the Sonora mine , in Mexico. I’m sure. Well, actually I’m pretty sure that the Mexican government doesn’t want that. But basically it’s a little bit ofk. The mine is in Chinese hands. And to nationalize it, that’s something the Mexican government can’t do and will not do.

However, the new mine that’s coming up in Mexico that potentially will come up in Mexico will be owned by the people. That’s basically now. I think for the last six months or so, written in law. So they can’t be owned by foreign companies anymore. It’s basically will be processed by a Mexican state company.

Antoine Walter: So even at that level you might say Mexico is part of. really muggle here. So I might say something stupider than me, but the I mean, Mexico, us, Canada. So you would think if US and Canada are beefing up their supply chains, maybe Mexico doesn’t need to, but it seems like every country wants to have some security about access to lithium in the future and access to EV revolution.

Tony Strobbe: they, They call it the gold rush. The current day Gold Rush. If there’s lithium in the ground, you want to get it out and you wanna make value of it for the profit of the people at least in, in Mexico which sounds a good idea.

However, the lithium the minds that are not yet operational, but. Can go online. Basically they are lithium, sedimentary, lithium they call it. So basically lithium hiding in clay and to extract lithium from clay. That’s something that is not yet done in on industrial scale.

So quite frankly, they’re a long way off. In addition, if you don’t want foreign investment or foreign involvement it’s not so easy to get the required funds to start up a lithium supply chain. You don’t have also the expertise in-house. To build up that supply chain.

You mentioned in the beginning of this podcast, you mentioned Bolivia. That’s a key example for 20 years. They wanna do it on their own, quite frankly. For now, what do they have to show for? Well, much nothing I believe.

Antoine Walter: To, to me, really as a layman, Bolivia is an in incredible thing. I, I can’t rub my head around it. You have 58% of the words lithian resources, and you don’t produce a single gram,

Tony Strobbe: Yeah.

Antoine Walter: and you have this. Multi-faced, tender for whom is gonna be the technical partner. And still they haven’t reached a point where they’ve taken a decision.

So I, I have. My difficulty with it to really understand it. And the other thing is what you mentioned about the know-how is pretty impressive. I was looking to know what names of companies and the companies were called European, lithium European methods and. , all these companies are from Australia, and then you had Argentina lithium, lithium, Americas, never Lithium American, lithium, and all these companies are from Canada.

So it’s only to me like they are. In fact, out of these about 60 projects in development I think something like 40 of them. So two third are done by Canadian and Australian companies alone. So to me what that tells is that there is a knowledge and a know-how in certain countries, because of their mining background, because of their oil and gas background.

And when you come to Tahi and kind of unknown fields like lithium, I mean, it’s still in development. Well, you rely on that experience and they have an.

Tony Strobbe: absolutely. I mean, what you see in Bolivia, Bolivia wants to avoid, absolutely avoid what would happen in stripping out the gold and the. Valuable metals and materials in the 17 hundreds. They wanna avoid the same scenario, so they’re really reluctant to invite the foreign experts in to get the lithium out.

And that’s basically what, what is happening? They say, yeah, but and, Of course the foreign investment, if you do a foreign investment, you wanna have a return from it, and that return wants to be as much as possible. But Bolivia wants to have as much as possible captain , in Bolivia to improve the life of the Bolivians.

So it’s a little bit well, haggling, I would say . But it took them 20 years now and they’re still haggling, which is not a good thing. Not for the industry, not for nobody actually.

Antoine Walter: You mentioned the investment, and that is also something which I found clever , in what you were sharing, which is it is capital intensive, so you have to raise money and you have to raise money upfront, long before you actually deliver something, which means for a while you are delivering on a PowerPoint and.

You might or might not reach what was written on your PowerPoint, which leads to sometimes inflated expectations, sometimes shortcut in the timeline, which are not that realistic. So all these projections we see of what’s happening towards 2030, how much is real and how much is wishful thinking.

Tony Strobbe: Well, I think it’s anybody’s guess really. But you are absolutely right. The PowerPoint presentations, and I say that to everybody who wants to listen to me. The power presentations are written to entice investors to invest. So what I wanna say is, oh, we are gonna have that, we’re gonna have that, we’re gonna have that two years later.

It’s very nice, but in reality, I dunno. it wouldn’t surprise me of the giga factors. If we talk about giga factors right now 50% of the giga factories, the capacity won’t be there. Pretty sure of it. There will be more firms like British Fault, that will go the same way.

I’m certain of it, I mean, as an investor and basically if you wanna step on the investing in the Green Wave right now, I would say do it, it’s still good, but do your homework. If you see a firm like let’s say Tony Volt my name, then building a Giga Effect.

Check out who that Tony guy is. Does he have a nice shiny website? And that’s about it. Check them out before you invest. Do that. What you’re seeing right now is basically many people are thinking, oh, they want to step on the train, they want to be there before it’s too late.

They don’t wanna say, , for Amazon, I didn’t invest in Amazon. I didn’t defend it Google and I missed out on that. Well, I would say, do your homework and it’s better. To skip on a good investment then to enter a bad one.

Antoine Walter: There’s a last leg that journey where I like to catch your brain, which is when I started this full investigation, you know, I’m a water professional, so I’m starting from water. That’s my thing. That’s the thing I understand. And the reason why I got attracted to this deep dive into lithium at first is that the promise of direct lithium extraction sounds so cool.

And I mean, it’s perfect. You are taking whatever. Groundwater, which has a certain level of lithium. And actually just in my backyard actually there is this type of water, which is rich lithium. You bring it through steps, which the water industry would consider. Pretty standard. I mean, we have the technologies, they have been tested.

Maybe they need to get slightly adapted, and at the outlet you get, lithium sounds really so cool.

I’m digging into the. The more I’m hearing that might as well never happen. So, , what’s your vision on Direct Lithium traction and where will it play a role if it ever plays a role?

Tony Strobbe: Well, basically , I share enthusiasm for the process. I strongly believe in dle. I have high expectations about that. But. It sounds too good to be true. I mean, you pump up a hot soup. Let’s say you take out what you want, then you pump it back in the ground. Wow. Oversimplified, of course.

But we are not there yet. And that’s also what you heard about. We are not there yet. Whatever the company’s involved claim. It’s still has technical issues that need to be resolved before mass production. I know about one thing, the real impact on diluting the underground brine deposit is still unknown.

You don’t know that. Also what you have is if you have a D l E plant it’s a hot soup. Basically it’s very abrasive for the piping. It’s very abrasive for all the materials you use. There are three or four different techniques to get the lithium out.

But if you use membranes, the membrane. Tend to clog up a lot. If you have an industrial process and 50% of the time the plant is down, eventually, that’s an issue. . But I agree with you. Vulcan resources in your area, I believe and control term resources in California, consultancy in California, I believe that are the two that, that doing it also live as something operational.

But it’s still not on the industrial scale. So I do believe in the process and I really hope it gets off the ground, but we’re not there.

Antoine Walter: And will it go out of the ground first as a standalone, or is it a clever, complimentary technology to evaporation ponds?

Tony Strobbe: Good question. I know Levant does it In, in there, I believe in Chile. It is while terminal resources in California is actually an extension of a Berkshire Hathaway plant that uses the heat to produce electricity. Because quite frankly, if you have a hot brine, you can also make steam and electricity, and that’s basically a known process which is done already.

The only step further you need to take the lithium out. I think in my view, I don’t know the process that much, but I do believe it’s a standalone process in common junction with the electricity production like Vulcan in the German plant. I would say if it can be done in Chile, Bolivia, Argentina.

Wow. You get rid of the evaporation pumps which is. Environmental not so friendly. But I don’t know which way to go, actually.

Antoine Walter: To close that deep dive. You made clear how there is a separation between the chemical parts and the assembly part and how that calls for two ends, the one which goes up to batteries and cars and the other which goes chemicals and mining or evaporation pond, or whatever it is.

Yeah. Yet when you look at PowerPoint, , they are players which are looking at building the vertical.

And if you look at what Ang is doing, somehow they are building that vertical. So if we look now in a crystal ball in five or 10 years in the future will we see these powerhouses going from the mines, somewhere in the word up to the battery, in the car, and maybe up to the.

Tony Strobbe: to predict the future, you need to look at the past. And if I look at the past, I mean, you had the same thing going on with microprocessors. This shipping technology. There was also some people went first pretty much completely vertical and some didn’t. Now you have a design part with companies like Synopsis.

You have a part where they produce it, the fps, let’s say like T S M C. Then you have a third part of packaging that, that actually make the chips. And then you have delivery machine manufacturing, like A S M L. Basically the factory that went all vertical had to stop because the research and development part to be at the top, the research and development was way too much to do it, and that’s why you see that separation.

And I think with batteries it will be the same.

Antoine Walter: So we are rather heading towards ultra specialization than we are heading towards verticals.

Tony Strobbe: I think so because quite frankly, it’s a CapEx intensive industry. And if you can go back to British Fault British fault, need to. Invest in research and development, need to build a pilot plant to do their testing, need to build a giga factory, they all need to do that.

Quite frankly, you need to have a lot of money to do that because what you’re doing is you’re making , three companies and ones. So basically what would you have, you have one factory that does r and d. You have another factory or company that basically makes a pilot line and the designers can test their product on that pilot line at a fee of course.

And then basically you have the giga factories who. Make the batteries on an industrial scale with technology that actually comes from somewhere else. And that’s what actually will happen with the new guy that’s taking off British Vault Recharge industries. They have their own products, but basically the technology they use is not their own.

They use technology from sior Fee, that’s basically another company. So what they are going to do is basically they gonna produce. On industrial scale batteries, and that’s what British Fault also had to do. But they choose to also build a pilot client. They also built a research and development center, and that can also work.

Look at Norville. Norfolk does it like that, but nor has a strong backing. I mean, they have $1 billion as a backer, while British Fault has nothing as backing, so you can’t do.

Antoine Walter: you have the risk of spreading yourself too thin.

Tony Strobbe: Yeah, absolutely.

Antoine Walter: Tony, it’s been incredible to tap into your brain for that deep dive. So thanks a lot. And to round off these interviews, I have a series of rapid, fair questions. I’m sorry, because they might be a bit water oriented at some point, but I’m sure you also have a Joker card, which you can use whenever you want.

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Rapid fire questions:

Antoine Walter: The principle is I try to keep the questions short and you have to try to keep the answers short, and I’m the one side tracking, so don’t worry. My first question is, what is the most exciting project you’ve been working on and.

Tony Strobbe: Well, one of my first, let’s say, designing, building, and installing a temperature supervisory control system for a line with hundreds of curing ovens for tires in Sri Lanka. Why because early nineties in rural Sri Lanka, most line raids had never seen a TV before, let alone I needed to instruct them how to operate the laptop computer.

So that’s something that is, was exciting.

Antoine Walter: Can you name one thing that you’ve learned the hard way?

Tony Strobbe: Well, even the best programs fail if you cannot achieve the support of all the stakeholders. Stakeholder management is really important.

Antoine Walter: Is there something you are doing today in your job that you will not be doing in 10 years?

Tony Strobbe: I see myself, well, in 10 years. I’m I’m not 20 anymore, so in 10 years already. a long part. But basically the HandsOn part, I see that already the hands-on part of actually building and visiting sites constructing the plant is becoming less. Every day the advisory part is growing, so basically advising plants, advising people who want to start a manufacturing plant that is growing,

Antoine Walter: I’ll slightly change the next one. What is the trend to watch out for in the industrial sector

Tony Strobbe: For batteries, I would say battery chemistries are evolving and quite frankly I see them evolving in the solid state batteries and hopefully in 10, 15, 20 years into battery on chip technology, that’s something that interests.

Antoine Walter: I’ve seen you posting about the various possible materials that could replace Lithium, you’re absolutely not liable to your bet at all. But if you had to bet on just one, which one could it be?

Tony Strobbe: I would say nickel, cobalt, manganese will go further. Now we are at eight 11. It’ll go further to 9 55, so higher nickel content. Basically the existing technology. That’s my path. Just for a short while. I’ll think from the next decade onwards, it’ll be solid state.

Antoine Walter: Well, Tony, it’s been a pleasure to spend that hour with you. If people want to follow up with you, what is the best place for them to look you up?

Tony Strobbe: Well, I the same way you look me up and basically I post every Monday I post something new about the EV supply chain. I’m more in specifically lithium and the chemistries and all those kind of things. Linkages.

Antoine Walter: So LinkedIn is the place to follow you to contact.

Tony Strobbe: is. Yes.

Antoine Walter: Awesome. Well, thanks a lot and I might be interested in a follow up at some point to see how all of that develops , in, let’s say one or two years. So thanks that for your time and I hope to speak to you soon.

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The post The Shocking Requirements of Spodumene Processing (and More Lithium 101 stories) appeared first on (don't) Waste Water.

Find out more with my entire Lithium deep dive.

with Benjamin Sparrow – CEO and Co-Founder at Saltworks Technologies

Saltworks provides innovative products and solutions for industrial wastewater treatment and desalination.

Full Video

What we covered:

The current state of Direct Lithium Extraction (DLE) and its possible technological paths

How DLE gets paired with Concentrate Refine Convert (CRC) processes and how this takes lithium to battery-grade

4⃣ The Two main sources of Lithium in the World and their Two Contenders (DLE & Battery Recycling)

The timelines of a lithium mining project and how fast tracks are myths

How speed to market is going to be a key metric for a new lithium player’s success and how to maximize your chances of success

How regions with a rich mining history, such as Canada and Australia, will lead the charge in the lithium mining revolution

How water processes being massively used in lithium extraction projects will have consequences on lead times and technology availability in the Water Sector

How lithium mining is an industry where everybody is growing and how there is more money flowing into the sector than companies ready to receive it

Generation 1 vs 2, Evaluating a Surprise Lithium Project, what’s important for DLE’s Success, Key market players, Growing as a water technology scale-up… and much more!

… and of course, we concluded with the 𝙧𝙖𝙥𝙞𝙙 𝙛𝙞𝙧𝙚 𝙦𝙪𝙚𝙨𝙩𝙞𝙤𝙣𝙨  

Resources:

Have a look at Saltworks‘ website

Come say hi to Benjamin on Linkedin

is on Linkedin

Antoine Walter on LinkedIn

Infographic: Lithium Mining

Teaser 1 – There’s plenty of Money but a few Companies able to receive it in DLE, CRC and Lithium Mining

Teaser 2 – It Takes 3-4 Years to Build a Lithium Mining Project (Myth Busting)

Teaser 3 – Direct Lithium Extraction is not faster to market than Evaporation Ponds

Teaser 4 – Lead Times are Increasing: Get your Lithium Mining technology now, or you might be left out!

Full Transcript:

These are computer-generated, so expect some typos

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Antoine Walter: Hi Ben. Welcome back to the show!

Benjamin Sparrow: Thank you for having me, Antoine. Very pleased to be here.

Antoine Walter: Actually, I think it’s this first time that I had a guest so closely back after, I mean, we, we discussed. Less than one year ago, and it feels to me like so many things have changed and the thing that maybe changed the most is me, because when we discussed together, I discovered the words of D L e, CRC and lithium extraction.

And since then I had the chance to dive a bit deeper. And it sounded to me like I had the best person on that microphone and I didn’t leverage it. Right. So that’s the reason why I wanted to have you back on that microphone. So thanks all for taking the time. So that’s the very wordy introduction.

There’s one thing I noticed on your website between our two conversations is that last time lithium. Had some space on your website and was one of the topics you were addressing. Now it is really the headline, like you open the Saltworks websites and it really opens with your new refining, lithium refining testing center, your capabilities, everything you do to support that industry.

So is that kind of a marketing soft pivot?

Benjamin Sparrow: Uh, it’s an acceleration of where the market is. So with Saltworks, having started with industrial desalination, concentrating, refining, and crystallizing, hard to treat. Industrial waters that those technologies translate very ov, very well over to lithium refining to concentrate, refine, and convert lithium resources.

And there’s examples of these kind of machines behind both of us.

Antoine Walter: So actually just tell me what, what’s that machine and what’s this one? So that we, we have an.

Benjamin Sparrow: Sure. This is a lithium carbonate reactor. Okay, so you put clean lithium chloride in and battery grade lithium carbonate comes out. There’s some washing and drying that needs to be done, and what’s behind you is a lithium hydroxide crystallizer.

The two primary lithium chemicals that go into batteries are lithium carbonate or lithium hydroxide. ,

Antoine Walter: I’ve seen you recommending to go to lithium carbonate because that’s the most cons, cost competitive today, or the best way to, to get money out of the system today. So is that the main driver of your systems or do you resell both of them?

Benjamin Sparrow: Sure. Um, so lithium carbonate is a shorter hill to climb. Lithium carbonate is a taller mountain to, pardon me? Are we doing repeats? Yeah. As much as you wants. Ken, I’ll turn off the screen too. . So sorry I made a noise. Sometimes I’d muddle at my words, Kate. That’s all.

Antoine Walter: Where do I start? So Liam Carbonate side involves on the both sides of it, but I’ve seen you mentioning that carbonate was maybe the economically the best one you would advise to people right now.

Benjamin Sparrow: Sure. And there’s a fair bit to unpack there. Um, today, based on economics, lithium carbonate is more profitable for the lithium asset. and here’s why. Uh, it’s lower cost for them to reach the battery grade goal, and they get paid a decent price in the market. The incremental value or market price for lithium hydroxide isn’t, is not as high as, uh, to sustain, to provide the profits for lithium hydroxide.

So ultimately lithium carbonates more profitable, but there’s another component. If somebody builds a lithium carbonate plant, they can always bolt a lithium hydroxide plant onto the backend. So by going the carbonate route, your future proof to go with hydroxide. In addition, some EV and automotive manufacturers are installing lithium carbonate to hydroxide conversions at their battery plants in preparation to absorb lithium.

From the marketplace. So we help clients go in both directions. It depends, do you want to climb a hill lithium carbonate, or do you want to climb a mountain? Lithium hydroxide.

Antoine Walter: So that one you said the input is lithium chloride. So that’s what you get when you’re evaporating brine. So does that mean that it is cuttered to these.

South American market so far.

Benjamin Sparrow: So, um, it could, you could use it, but it’s really catered to direct lithium extraction processes. And now in all honesty, this is a brine refined machine. So Brine refined does various things. We have brine refined machines at semiconductor plants that help remove fluoride from wastewater.

We have them on reverse osmosis brine to help remove silicon and scaling ions, but they. Uh, can and do precipitate out and produce lithium carbonate. So it’s a flexible Swiss army knife of a chemical reactor that you can use to do various things. Lithium carbonate production being one of them.

Antoine Walter: So you explained last time how you are really focusing on the crc.

So concentrate, refine, convert, convert. I was forget the last C. Um. and you are bolting that to D L E D L E so far, doesn’t have a commercial scale plant. So you are working with these junior companies or new entrants in the market. , why don’t you want to go also over that hill and go into dle?

Benjamin Sparrow: Oh, uh, there’s a lot of great companies out there already practicing dle, and it’s a very active space.

There’s a lot of sorting out that will be done over the next five years, shall we say. Some will thrive and survive. Um, others will fall by the wayside. We’re purposely DLE agnostic such that our clients have open access to the CRC technology regardless of what DLE is up. Try to maintain commercial flexibility for our clients.

And

Antoine Walter: so this refining step, will it work as well for concentrated pot domine or is it then a totally

Benjamin Sparrow: different route? It’s a totally different route. Um, for your listeners and viewers that of interest, there’s really three ways to battery grade chemicals. One ispo, domine, or rocks. Right. And um, often the pathway is lithium hydroxide.

You would, the machine that’s behind you is a lithium hydroxide crystallizer. You could use that in a su domine process. The other way is the evaporation ponds in South America, which, um, they concentrate naturally. using the sun and the atmospheric dry air. Uh, and then ultimately they could pop their concentrated lithium chloride into a brine refined lithium carbonate reactor.

But they already have methods of doing it. Or the method that you mentioned, which is dle, where you’re extracting lithium from geological brine in wet climates where you can’t build evaporation ponds. You mentioned

Antoine Walter: three routes. Mm-hmm. , there’s potentially a fourth one, which is recycling lithium from battery plants.

any type of lithium that you, I mean the end of life of a battery or whatever. Is that something you’re looking into as well?

Benjamin Sparrow: Oh, so I’m really glad you mentioned that, uh, because 30% of the lithium that goes into a battery plant can end up being wasted. And the answer is yes. Not only are you looking at it in into it, but two machines very similar to the ones that’s behind you, are currently being started up at a lithium battery recycling plant in the us.

Antoine Walter: Let me give you a bit of behind the scenes here. . I started this lithium investigation and I thought, I want to have really the full spectrum. So I went to Australia, looked at the mines. I I, I discussed with DLE companies, I discussed with evaporation bonds companies. I discussed with battery companies. I discussed with um, consultants in that market and I thought, okay, I already had saltworks on that microphone.

Maybe there’s someone else which can be active on this crc and. I might be stupid. That’s a good possibility, but I didn’t find anybody else than you in that, in that exact spot of crc. So what’s your special sauce? What makes you so unique that. You are the one be

Benjamin Sparrow: all. So we do absolutely do have competitors.

Um, there’s a certain very large and, uh, reputable company out of France. Okay, so the Reds, . Yes. Yeah. And, uh, they equally like us practice industrial desalination. And with that, um, they’re a leader in CRC in lithium. So what’s our special sauce? What sets Saltworks aside? Our plants are highly modularized and highly digitized.

and what we’re finding is that translates into higher lithium yield and recovery. That’s very important and equally shorter timelines to get to plant up and running at site. So rather than stick building a lithium refinery, At a remote site that can be quite expensive, and then having to commission it at a remote site.

All of our plants are modular built here in this factory and pre-commissioning, pre-tested here, and so they’re Lego blocks, adult Lego blocks that go to site and can be placed down and then bolted together. They’re also pre-com commissioned here and highly digitized, so we use advanced levels of automation to reduce.

Needs and also to reduce chemical consumption, increased precision and increase yield.

Antoine Walter: You were kind enough to give me some, some pre-reading before that conversation and something really struck me in what, what you sent me, which is that your timelines are incredibly short. You are advising people to go.

A first test, then a pilots then edema plant and altogether takes one year, one and a half year. Mm-hmm. . And when I look at the DLE projects out there, or even the evaporation pond projects out there, the ones which want to, to go a bit beyond the existing four wants, they all have 10 to 15 years timeline.

So, , what makes you so confident you can be going so much

Benjamin Sparrow: faster. Sure. So, um, to unpack that question, we’re not going necessarily faster than the mines or the permitting process, but it does take us. 12 months from a purchase order to build plants like what’s behind us right now. So that’s about 12 months.

And if somebody wants to pilot and do a Fulsom pilot, you can get that done in three to six months. So that’s where you can get to the 18 months. But to your very good point, there’s a whole pile of other work that needs to be done by others. There’s the permitting. , there’s the brine disposal wells. The building needs to be put in, the equipment needs to be put into the building, uh, needs to be commissioned and what have you.

So, you know, realistically from a go that a company has a permit and they have financing and they point to dirt, they’re probably looking at three to four years anyways, even inclusive of our timelines. They still have to, if there’s, if they’re going dle, they have to figure out their DLE system, procure, install, and commission, their DLE system.

Uh, just to switch topics to evaporation ponds for a second. A lot of people talk about how evaporation ponds take 18 months to get to production, right? And that’s just because of water having to evaporate and concentrate. How long do you think it takes to build a DLE plant? It takes 18 months to two years anyways, so I don’t really see DLE as a faster way to lithium production than evaporation ponds.

Antoine Walter: I have to say, uh, I have to give credit to, to Juri, the host of the Global Lithium Podcast who told me that you have this element of DLE being faster because the second of it starts, it’s producing straight away or almost straight away. . But once an evaporation pond is started anyways, it’s gonna produce the same yield.

It’s just that it has this startup phase, but which is the same then building the dle. So in fact, that’s maybe not the best argument in favor of dle. You’re right. Never and so is Joe. Never. Nevertheless, when you look at at South America right now. So to stay on evaporation ponds, what I got is that they could be producing much more lith.

If they had more water and, and a better extraction efficiency than what they have today, which sounds like. Something calling for a better technology to maybe reuse that water, loop the water, and maybe having a higher extraction yield, which again sounds like something where you could be helping. Am I fully off with

Benjamin Sparrow: that?

No. Um, the key is the extraction yield. There’s, um, If I’m allowed to say misinformation, there’s some misinformation about water utilization and evaporation ponds. And just to focus on that for a second, one needs to think about the quality of water. So they’re pumping up hypers, saline water from underground that cannot be used for agriculture or human consumption.

And it happens to contain lithium. So it’s low quality water, very similar to the, uh, the concept of entropy in thermodynamics and physics. So it’s highly disorder or disordered water. It’s low quality. Um, . Now, in terms of their freshwater consumption, they do not use a lot of freshwater in these evaporation ponds.

They’re literally just counting on the sun to evaporate as much of the water as possible to the atmosphere. In the process of doing so, they’re crystallizing out sodium chloride and potassium chloride, so they’re crystallizing out all of these salts, and herein lies the problem. The process of crystallizing out those salts, they’re losing lithium.

Lithium is bound up in those salt crystal. Equally, they have to add some chemicals, lime to deal with magnesium, and when they precipitate out the magnesium oxide, they’re binding up lithium. So the downside of the evaporation ponds technically really is, is what you hit the nail on there, which is the yield.

Their yield is about 40, 50%. Now with DLE technology, one could increase that yield. You could put dle. Geological brine resource and recover 85 to 90% of the lithium through a DLE system. And then in your downstream CRC, you could recover another 80 odd percent depending on how you configure it. So you up your yield.

It’s not going to be as dramatic as some claim, but you will be able to up your yield with DLE in South America.

Antoine Walter: So is that the first output for dle, or shall we really focus dly on new ways to produce lithium? Because it sounds like a low hanging fruit. You could be. If I’m very car architectural, you could be doubling your yield mm-hmm.

by marrying DLE with evaporation ponds. So why bother looking at other sources? No,

Benjamin Sparrow: you’re, you’re spot on. Um, if DLE is successful, it will one, we will one day see it, at least I’m confident. We will one day see it upstream of evaporation ponds. They’ll use DLE to produce a dilute dirty lithium chloride, and then they’ll use the evaporation pond to concentrate it.

That is a much more elegant. . Uh, however, uh, the evaporation pond companies have been looking at DLE for 20 years. It’s been been around for a long period of time, and they haven’t adopted it yet. And when you talk to them, I’m not sure what they’ve said to you, but when you talk to them, it’s about the water consumption because Generation One DLE does consume a lot of water.

And to your point, they don’t have water. And then also the capital cost hasn’t been as capital cost competitive as building a big. Relatively economic to put ponds in deserts if you have the land, which they tend to have. Which they tend to have. In terms of D’S first market application, um, I think that it’s wisely focused on geological brine in North America and Europe, like what standard lithium’s doing in the Smackover or Vulcan in um, Germany.

And then, uh, soon there’s apparently gonna be some developments in France. As well. So, uh, you cannot, we do not have the technological option to put a pond there. And so I think you’ll see d e grow up there first, become successful, and then start to be installed on the evaporation ponds.

Antoine Walter: You, you shortly mentioned d e Generation One and generation two.

Mm-hmm. , can we define those two generations?

Benjamin Sparrow: Absolutely. So, generation One Daily, which has been around for over 20 years, it’s um, an Illumina based absorb. I think in France you call it aluminum? Yep. Our American France call it aluminum, so it’s an Illumina based absorbent. And the Illumina based absorbent, uh, the lithium containing water flows by it.

So it’s either a powder or a resin lake. Material flows by it, and that absorbent grabs the lithium. . Okay, so that’s fine and into anti, but now you need to release the lithium. The way you do that is you stop flowing the brine past the absorbent. You now flow water past the absorbent. Mm-hmm. , it’s a water elution, so Illumina based water ion, and it works and you can very mildly concentrate the lithium, but more importantly, you reject a whole pile of total dissolved solids and, and salinity.

You’re essentially improving the lithium to TDS ratio, and that’s a key metric. We’ll talk about more lithium to td. , that’s generation one, been around for a while, and there’s some great companies that have really tuned it and improved its efficiency. Generation two is a different fundamental technology.

That’s where you have a titanate or manganese oxide based absorbent. You, again, flow the lithium brine past it and it grabs the lithium, but in order to, and it does a better job at grabbing the lithium, but there’s a catch. In order to elute the lithium from the absorbent, you need to wash it with. . Mm-hmm.

thermodynamics, again, kinetics. So, uh, generation two DLE plants are quote unquote hooked on drugs for many, many years, right? So they have to keep pumping acid into the system. When you pump past it into a system, you lower pH. That means you then have to add base to elevate pH. Again, generation two has a very significant advantage in that it can concentrate.

It can achieve a higher lithium to TDS ratio. It’s a capital cost smaller plant, but the operating costs are higher because you’re constantly having to allude with acid and then adjust with base. Most DLE plants have a chloral Cali plant bolted next to them. In concept to produce the acid and base.

It’ll be continuously used. ,

Antoine Walter: you mentioned generation one, generation two. It’s tempting for me to ask, is there a generation three in the pipeline? There’s

Benjamin Sparrow: a lot of people working on generation three, um, university levels, national lab levels, uh, some startup companies. Uh, we’re watching it closely and it’ll be exciting to see what comes out.

Antoine Walter: So that’s something which I like to understand is why do you watch that closely? Because that happens. I mean, they’re your neighbors, but it’s not in your house. It’s whatever happens before your crc, but it’s in the daily field. You could say whatever they have at the outputs. We ensure that. Manage it. So why do you look into their garden?

Huh?

Benjamin Sparrow: We want the best for our clients, and now we only look into their garden if we’re invited to do so. Uh, but a lot of people put a lot of information online. They publish academic papers and at our heart, uh, Saltworks Technologies, we are a technology firm and we’re innovators and, and we’re curious.

And so we’re constantly on the lookout to find. Better technologies that will help our customers accomplish their goals, including if they’re not invented here. We’re very proud of our digitized modular plants that we build for our customers today. Uh, but customers do ask us, because of our position in practicing CRC and being downstream with so many DLE technologies, they do ask for our council on DLE systems and, uh, which way their compass should point dle.

Is a bit of a smoky space there. There’s been some big claims made. Um, there’s been a few houses of cards built and, uh, there’ll be some winners in the future. There’ll be some legitimate players, but there’ll also be some that fall by the wayside. And so it’s very confusing for asset owners to navigate that space if they don’t have the technological background around the periodic table elements in water and kinetics and et cetera.

And that’s, that’s what our people do here every day.

Antoine Walter: I remember that from, from our first conversation where you say you, you’re basically moving the elements in the table of elements right and left. So, mm. That seal applies in that focus of, of, of lithium. You just inaugurated your lithium refining center.

Mm-hmm. . So test center, I guess. So what is it that you can do with your new capabilities?

Benjamin Sparrow: Sure. So we have, uh, two. Test pilot plants pilot one, one ton a day. It’s over there. Pilot 10, 10 tons a day, and it’s outside clients ship. D l eent, and we convert it into battery grade, lithium carbonate or battery grade Lithium hydroxide

Antoine Walter: in the 10 tons a day of lithium carbonates.

Oh, I

Benjamin Sparrow: wish 10 tons a day. Of dilute. So DLE produces, and I, the DLE folks might throw bricks at me for saying, this, DLE produces dirty, dilute lithium chloride, right? You still have to refine it, you still have to concentrate it or remove a whole ton of water and then convert it.

Antoine Walter: And so what you try to find out here is what is the right technology to do that?

and to fine tune that so that for their demo plants or their big plants, they go with the right technologies. So that’s really what you’re doing.

Benjamin Sparrow: Exactly. We develop PFDs process flow diagrams. Mm-hmm. , optimize them on a mass balance level at a computer level, and then test it in our pilot plants to, um, confirm the pfd, but also to very importantly provide them lithium carbonate samples and lithium hydroxide samples that they can then provide to their off-takers

Antoine Walter: so that you can prove that it’s really

Benjamin Sparrow: battery.

Correct, correct. And they can take those samples to the off-takers. They can sign contracts, they can then secure financing and build their facility.

Antoine Walter: When you discuss with water professional, they always tell you that every drop of water is different. Hence, especially when you go on the dirty side of water, you have to capture your process all the time.

And when you discuss your financial people, they tell you, come on, can that really be true? Can’t we just standardize stuff? Now that’s a different field. It. concentrated brine. It’s dirty. Liam Carbonates. Ellu. Is it really that way that every single sample you receive is different, or do you also see trends like that comes from South America?

It’s gonna be mostly like that, or that comes from North America? It’s gonna be mostly like

Benjamin Sparrow: that. There’s absolutely trends and there’s a lot of similarities within the, within lithium plants. Um, I’d put it this way. So, and again, these examples behind us are a great example. any CRC plant, it’s often the same processes.

You’ll have a lithium carbonate reactor and you’ll have a evaporative crystallizer or an evaporator that’s behind you, but the process flow diagram for that plant will differ based on their chemistry. You’re rearranging the parts of Mr. Potato head to put together an optimized plant. .

Antoine Walter: So that means that step three could become step two, or how much would you rearrange it?

Correct. Okay. Correct.

Benjamin Sparrow: Okay. There’s a little bit of furniture rearrangement. Step five in some cases might be bigger. Step five, for example, would be an ion exchange polish. Some brine have increased boron levels, so they might need a boron extraction system and increased ion exchange. Some plants or some lithium resources have lower boron, so they do not need that step.

Antoine Walter: And from all these steps, what’s the tricky part D. . Okay. So we not within this crc it’s comes the tricky part Comes before,

Benjamin Sparrow: yeah, yeah. To, to your very good point. There have not been, um, really legitimate end-to-end d l e commercial plants built. Uh, there is a D L E system operating South America that’s been operating for some time, generation one and it’s bolted to an evaporation pond, so we should have actually spoken about that.

So, um, and uh, so, so that plant’s been around for some time and then there’s also some D L E CRC plants in. .

Antoine Walter: So what’s the best combination? Do you always bolt the CRC next to the D l e or the evaporation pond or whatever it is? Or would you also see the possibility to have this conversion plant somewhere else, like closer to the battery production?

Oh,

Benjamin Sparrow: good question. So, uh, this is where one can get into distributed production. So let’s take for example, an oil field type analogy. And there’s a lot of. Oilfield containing pardon of me. Lithium containing oilfield brine. And in the oilfield, they’ll often use the term of battery, right? And I’m not talking about battery in terms of positive and negatives, but a collect gathering battery.

And so you might, for example, have a series of wells that come to one d l e spoke, if you will. , that DLE system is producing dirty, dilute lithium chloride. You then may have some concentration close to the dle, reverse osmosis, maybe ultra high pressure, reverse osmosis, and produce a even more concentrated lithium chloride juice, which you then ship to a centralized refinery.

That centralized refinery is receiving concentrated lithium chloride from various uh, locations, and then further refining it and converting it. So sort of like a hub and a spoke. Um, some are looking at that strategy for their lithium developments in terms of shipping lithium chloride, right to a battery manufacturer.

I’ve certainly heard talk of that, but you’re shipping a lot of water and, um, those economics and the GHG impacts of it may be questionable.

Antoine Walter: It kind of makes as an we speak. I mean, when we spoke last year, you mentioned how lithium had multiplied price by by five. And that was the highest it was. It has it had ever been at that time and since then, it’s been a bit up, a bit down, but mostly flat.

All specialists say that it’s gonna be staying above, almost all specialists say it’s gonna be staying above this $50 per kilogram of 2000 perton at that price. The beauty is that everything is profitable. Everything is economical, including. Putting rocks not even concentrated into boats and crossing the word with it.

So in that happy bubble, we could be testing everything. So is it like an open space for the imagination, or how would you see that?

Benjamin Sparrow: In my view, I think a key metric there is going to be speed. So eventually, um, high prices will solve high price. A lot of projects will get developed and prices will erode, and so those who are first to production with speed will then achieve cash flow and achieve profitability and will survive.

And of course, they hope that their costs are among the lowest on the cost curve. Those who are late and on the highest on the cost curve, they may miss the boat. Uh, it may be that at that time on an inflation adjusted basis, lithium comes back down to $10 a kilo. . So it’s very important for speed. Hence again, why these digitized modularized plants are beneficial.

You can get them out fast, you can get them installed, you can get to production

Antoine Walter: in, you know, there’s, there’s this saying that in a gold rush, the one making money is the guy who sells the tools. So it’s not the gold rush, it’s a wide oil rush, but we all know that. Mm-hmm. , at least 2 million tons will be needed by 2030.

Other say three or five. , everybody’s throwing numbers. One thing’s for sure is that there’s an imbalance between demand and supply. Mm-hmm. , I’ll just restart the camera. You bet.

Benjamin Sparrow: I’m glad you caught up with Joe. Larry,

Antoine Walter: I. puts a lot of pressure on him. good. I’ve been writing to him a lot. Yeah. I’ve been listening a lot to his podcast as well, so I had informed views on what he was saying. Yeah. And he’s brilliant, so

Benjamin Sparrow: Yeah. Yeah. I think he was, I think, uh, during our last session you asked who he was, the one person you should have next on the podcast.

I’m not sure if you’re call, I said, Joe Lowry . Um, let’s continue.

Antoine Walter: Um, so yeah, in, in a gold rush, you would expect to the, I mean the, the tool seller to, to be, what’s that, sorry, I lost my, I know where

Benjamin Sparrow: you’re going. Okay. Um,

so there’s white

Antoine Walter: gold, so it’s, it’s, it’s white oil. Mm-hmm. , um, and you are basically setting the tools. So is that the best position to be in the.

Benjamin Sparrow: Huh? It depends on who you ask. Uh, it would be wonderful to own a lithium resource, but you’re less diversified. You’ve got one chance to make that resource successful.

Saltworks. Our view is we’re quite diversified in selling the equipment and the most advanced tools to help people refine and recover their lithium. There is a lot of lithium on this planet and there’s a lot of lithium in all various brine, and the world could easily get to the 2 million tons per year of lithium carbonate that we.

with the resources that are known today, it’s going to be those that can move fast enough and develop the projects in a risk managed fashion that will supply that market. And, uh, that’s again, where we really focus is providing those tools, providing them that they’re robust, they’re reliable, they’re effective, and they’re dis digitized and they’re fast.

So

Antoine Walter: we’ve discussed a lot of objective parameters. Mm-hmm. , I mean, the cost, the technology. And the market trends. Mm-hmm. , which is maybe already a bit more subjective, but still pretty objective. There is nevertheless a big subjective part to all of that, which is geopolitics. Hmm. You have an existing route for lithium, which starts in Australia, puts whatever they can put into boats, ship it to China.

That route has been slowed down, which means China has started expanding to Africa. I mean, I’m not freewriting the Fuji politics. What I’m interested in is your view. , this North America Nexus. Mm-hmm. . Just in Vancouver, I found 12 companies, which are more or less dealing with lithium at different stages of, of the lithium route.

And even when I was discussing with Canadian companies, they told me, maybe we shall make sure that we have a Canadian value chain from A to Z, because repeating what we’ve done with oil and the dependency to the us. Might be dangerous. So is it like every single country will need ultimately to build its lithium value chain, or where do you set the bar?

Benjamin Sparrow: Okay. All right. We’re talking about geopolitics. Ah, that’s a broad one with a, with a technical geek. Um, so if we do talk about geopolitics in lithium, we should certainly talk about Bolivia at. Because Bolivia could, if they develop their lithium natural resource and just put ponds in, they would solve the supply.

Uh, come close to solving the supply demand imbalance. Uh, now as far as geopolitics in the US and Canada, um, this is maybe just geology and I won’t pretend to be a geologist. The US has higher concentration, lithium containing brine. Take the smack over or the Salton sea. Their lithium concentrations are 250, sometimes 300 milligrams per liter, so they’re 2 5300.

In Canada we’re 70 a hundred. The best was just found 190 odd. So Canadian lithium brine are weaker. In terms of lithium concentration, but like everything in Canada, they’re enormous. Everything’s bigger here. We’re a huge natural resource country, so there’s no doubt, a technological leap that needs to be made in Canada to provide access to those lower concentration, lithium brine, and there’s good companies working on that.

Uh, at the end of the day, I’m not sure that many automotive companies would really care where they got their lithium as long as they got it. I think their biggest need right now is supply. I’m sure they’d care if it was unethical, but if they could buy it from, if there’s ethical production South America, which there certainly is now, or Bolivia or Canada or the us, I’m not sure they would be too fussed about that.

Antoine Walter: That’s another one where I would, I’ve raised that question. To many of the people I, I’ve, I’ve met within that, that deep dive on the lithium topic, and I’ve got contrasted answers. So I’m interested in your opinion. You mentioned how they might look at what’s ethical or not ethical if in the coming decades we have such a strong imbalance between supply and.

Wouldn’t they just grab whatever is available regardless of ethics? It,

Benjamin Sparrow: yeah, it, it depends. I honestly don’t know the answer to that. I hope. Uh, and of course the question of ethics is a sliding scale. You could have the greenest, most ethical lithium in the world, and, uh, it’d probably be among the higher cost.

Um, I know I wouldn’t want to buy an electric car that had unethical lithium or unethical critical minerals. Um, , it’s that sliding scale. And where does white turn to gray to black? Um, I think there’ll be a lot of gray lithium on the market. and I think the automotive companies are going to accept it.

Antoine Walter: You mentioned the minerals and probably the best or worst example is cobalt.

Where anyways, 100% of the worst production is unethical. So Correct, but that’s a tangent. I don’t want you to, to bring it there. Um, I mentioned if you

Benjamin Sparrow: buy an EV by iron phosphate, lithium bion, bat Liam Lithium iron phosphate. so

Antoine Walter: you can be choosing with your, your, I mean, when you’re, yeah. Taking your car, you’re basically choosing the, the supply route.

That’s, yeah, that’s a good one.

Benjamin Sparrow: Lithium iron phosphates. A more sustainable lithium resource.

Antoine Walter: Coming back to this Canadian story Hmm. From the projects. I tried to track all the project, which are announced to come live between now and 2030. I made a list of them. Maybe I missed one. So, uh, if, if anyone wants to correct me, I’m really up for, for corrections, but there’s a strong pattern.

40% are developed by Australian companies. 40% are developed by Canadian company, and then the rest of the world is working on the 20% remaining projects. . So does that make Canada the future big lithium country?

Benjamin Sparrow: Well, the Canadian companies that are developing lithium projects, they’re often not on Canadian resources.

Absolutely.

Antoine Walter: Yeah. What’s the company itself, which develops it

Benjamin Sparrow: is, yeah. Yep. Correct. So Lithium America’s who um, will soon hopefully build Tacr Pass, America’s largest lithium mine. They’re headquartered in Vancouver Standard Lithium, who’s a leader in DLE and lithium brine extraction. , the Smackover Reservoir in Arkansas is headquartered in Vancouver, so, uh, there’s a lot of mining talent in Canada similar to Australia.

Mm-hmm. . And I think what you’re seeing is you’re seeing a natural progression of that into the lithium industry, but they go where the resources are.

Antoine Walter: Do you team up with your neighbors?

Benjamin Sparrow: Uh, yes, absolutely. Neighbors meaning in Vancouver or neighbors? Meaning in the us.

Antoine Walter: In Vancouver would be the closest neighbors.

Then there’s another spot in Calgary and then probably in the us. Yep. No, we

Benjamin Sparrow: do, we we go where, um, our clients are looking for our type of advanced technology and modular solutions and back to the discussion around there being a lot of lithium and a lot of lithium developments underway. I think the industry is Sue going to find that one of their constraints is process equipment.

what do you mean by that? There’s not a lot of companies producing the process equipment to direct lithium, extract the lithium, and then to concentrate and refine and convert it. They’re going to find a, uh, longer lead times.

Antoine Walter: So you’re saying that basically you, you, you might be the bottleneck.

Benjamin Sparrow: Us and our competitors.

And that has implications on the water treatment industry as well, because with the lithium industry heating up and, uh, these clients move fast and they have a willingness to pay, that’s going to draw capacity out of the water treatment industry. And so this will, this will all unravel in the coming years.

I hope I’m wrong, but I, I think, uh, in fact, we already know that lead times are increasing across the board. Some of our competitors are quoting up to three. ,

Antoine Walter: I won’t give any names. Mm-hmm. . But I can tell you a bit of behind the scenes I’ve discussed with some board professionals and I was surprised to see them moving into the lithium space.

And I asked them why they did so, and they told me we are sick and tired of these three to four persons profit margin markets. We also want to go into the 30 and 40% profit margin market. So it sounds like your provision has lots of chances of happening. , what’s your le, I mean, you mentioned some of your competitors are three to four years lead time.

What’s your lead time right now at Saltworks? Are you reaching limits? Can you grow as fast as the market? So,

Benjamin Sparrow: um, our lead, it depends. , for a end-to-end plant, multiple unit operations are lead times about 12 months for a single unit operation and extreme U efforts about six months. For a bigger plant it will increase, but lead times are absolutely increasing and across the.

we’re

Antoine Walter: in the middle of an amazing production center. You have everywhere across the building, additional tents with stuff happening. Is it that you’re moving the walls or do you have to to grow faster?

Benjamin Sparrow: Um, well, we do a lot of testing outside and, uh, welcome to Rainey Vancouver. So we have to keep rain, rain off of things.

Um, but we’re, we won’t grow out of this facility anytime soon. So we have work underway. We can four x production at this facility and, and we’ll do that, but we’ll soon be adding a satellite facility, uh, alongside our growth. All of our. Amazing partner vendors have been growing. So these steel frames are fabricated in British Columbia.

These tanks are fabricated in Texas. Uh, our electrical panels are made by a great company here in, in British Columbia. They’ve grown 40% alongside of us, so the whole industry is growing.

Antoine Walter: What’s your growth rate, uh, in terms of headcounts? Let’s use that one.

Benjamin Sparrow: Sure. So our revenue and order book is growing much faster than our headcount.

Okay. Because the company was designed to scale, um, and, and we’re now seeing that, but our growth rate’s about a hundred percent a year, whereas our head count’s about 30, 40% a

Antoine Walter: year. So that’s the typical path of a unicorn

Benjamin Sparrow: maybe, but we’re not trying to achieve that status. . Yeah, we just, we sincerely, honestly like doing the good work to deliver robust, reliable technology that either treats harmful wastewaters to protect aquatic ecosystems, or helps refine and recover lithium to advance the ev re revolution, advance grid energy storage, and to do so in a more sustainable manner.

Antoine Walter: I mentioned my, my tracking of the projects. Out of this projects, there’s a minority of daily projects. I found 11 of them, which are in, in a phase. They are beyond the definitive visibility study, so, or about to release the dfs. These 11 projects represent a 7.7 billion US dollar investments, so, , what’s, is that also on the critical path, this investment into that sector or Really the materials are much more critical in terms of coming in the way than money.

Money’s plentiful.

Benjamin Sparrow: Uh, I could be biased. , um, permits are an absolute requirement. . So per lack of permits can derail things or lack of, uh, stakeholder involvement like can derail things completely. Um, there’s a lot of lithium in the world. There’s a lot of capital that wants to be spent on lithium in the world, but there are not a lot of companies that can genuinely build and deliver full scale plants, both at A D L E and at a CRC stage.

What we’ve found when I consider the companies are very forward thinking, they’re working early to develop partnerships. With DLE companies, with companies like us and with the manufacturing capacity to make sure they can deliver. If they wait too long, they might find that they’re in a three or four year lead time window.

Antoine Walter: So let me give you my personal little projects because hearing you, I might have to move fast. So I’d like to secure that we have everything, uh, in the right direction to give you a bit of background. Um, I’m coming from the south of Zas, which is the eastern part of France, which used to be a place where there was potash mining.

So the full underground is full of potash mining. And once they exhausted the potash, they had a very clever idea. They used ths mines to store some, um, dangerous waste. And they did that for three years, and then it caught fire. And then the. Broke down and they had to stop, and now it’s been 20 years that they’re wondering what to do.

That waste with the mine, with whatever. So that’s one portion of the story. The portion of the story I won’t be going into today. The other portion of the story is that as they were evaluating the impact on the environment of that potential hazard, somewhere in, in, in the grounds, they took some water samples and um, and they found out that they had high lithium concentrations.

and I actually have to say they didn’t find that out. Nobody mentioned it. It’s just that I read the reports and the report was talking about everything else cuz they really looked at the environmental hazard. And when I looked at the report I said, Hey, sounds like a lot of lithium. So it’s kind of stupid what I’m doing because I’m doing that on record and people might be stealing that idea, but it sounds to me like I could become a billionaire with your help

So in preparation for our discussion, I sent you. and lasers of water? Yes. And uh, let me start with the lithium itself. Mm-hmm. , I compared it to what I knew, so I compared it to Vulcans projects in in Germany and I compared it to the SEL sea in the US and my sample has almost twice the lithium. Is that good

Benjamin Sparrow: news on the surface?

Yes. But there’s a metric in Lithium that a lot of people don’t speak about and that’s the lithium to tds. .

Antoine Walter: So when you say on the surface, yes, I would expect that my lithium to TDS ratio is very bad. So

Benjamin Sparrow: it’s, you’re better than the Salton Sea . Uh, you’re not as good as Vulcan.

Antoine Walter: And so what’s in particular, I mean three, the tds, so the total, which is problematic, or do you have specific scavengers that you should look for?

Benjamin Sparrow: So, so there, there’s many, um, dimensions to this. Your lithium resource. , how much water is there? So is it just one underground mine that once you’ve extracted it, you’re said and done? Or is that replenished and does, does the lithium continuously flow

Antoine Walter: in? I don’t know if the lithium will be flowing. What I know is that it’s part of the Rhine Valley, uh, water system, which is one of the biggest of the world.

So water is plentiful. I don’t know exactly where the lithium comes from, so. Mm-hmm. , the lithium source might be depleting at some points. I didn’t raise money yet, so

Benjamin Sparrow: I . Yeah. So, so let’s take the optimistic view and, and both of us can pretend to be geologists. Uh, so. Let’s assume then that this lithium resource continuously gets recharged with water and dissolves more lithium and brings it to the well where you’re bringing up lithium.

So, so, so if that’s true, then that’s a good thing. Um, you’ll have a continuous flow of water from which you can continue to extract lithium, your lithium. Am I allowed to disclose to your listeners what your lithium concentration is? You can. All right. So, uh, thank you very much for your, this data. Your lithium concentration is very good.

It’s 300 to 400. Milligrams per liter versus the Salton Sea in this dataset being 200, sometimes a bit higher, and then Vulcan being 200. So you absolutely have higher lithium concentration if you have AFL of the flow rate. That’s a good thing. Do you know if you have a means to dispose the brine after you’ve extracted the lithium?

Antoine Walter: I guess I can put it back exactly who it was, , which might not be solving the environmental hazard, but I’m, I’m here to make money, so , I’m fine. .

Benjamin Sparrow: Um, yeah. So you need to find a place to. and find a place to put it that it doesn’t frustrate or disrupt your lithium resource because if you, you know, you’ve extracted lithium, you put the brine back underground, you might just be diluting your lithium resource.

So Brian disposal is absolutely key to DLE projects. Okay. And, and this needs to be a DLE project. Um, otherwise you’ll have all this water on the surface in order to put it. And I presume you cannot build evaporation ponds in the south of France.

Antoine Walter: Okay. I could say that. Uh, my hometown is comma, and just next to Kmar, we have the place which is the driest of the entire France.

but it’s right that compared to other countries, driest of France still doesn’t mean much. So yeah, evaporation pond probably are not a, a possibility. Right. Especially because we wouldn’t find the ground for that.

Benjamin Sparrow: But yeah. Yeah. I’m stakeholders and permit, so I check into permitting, um, in particular around Brian disposal because if you can’t dispose the brine, your project’s probably dead.

Okay? So you need porosity, you need flow, um, you need Brian disposal, you need infrastructure, um, power. And uh, but then if we get into the chemistry, your lithium to TDS ratio, is oh oh two. Um, pardon me, Vulcans Lithium to TDS ratio. Our resources oh oh two. Yours is oh oh one 13, whereas the Saltan C is oh oh one.

This is, and your TDS is very, very high. So although you’ve got this 300 or 400 milligrams per liter, lithium, your TDS is. 240 to 360,000. So it’s nearly saturated and that’s why you must use D l E. If you just try to evaporate the water off and precipitate out the salt to concentrate up at lithium, you’d lose all the lithium with the precipitated salt.

Okay, so you need D L E and then becomes a question of do you go generation one, D L E, Illumina and water wash. or do you go generation two, tighten eight. Manganese oxide and acid and base. So what’s water access like in your region?

Antoine Walter: Plenty full. Okay. So really the Rain River could stop flowing. We would still have water for a century, so water is

Benjamin Sparrow: available.

Okay. Um, and if you want to do it fast because you need to get to market fast, um, you’d probably want to go generation one. DLE technology. It’s readily and available today. Uh, if you can solve the brine disposal problem, then you might be onto.

Antoine Walter: So you’re saying that the Salt Sea, which is developed by Berkshire Hadaway, so Warren Buffet, which got 14 million grand from the federal US governments at the same day the Biden administration was inaugurated, has.

less of a goods project than I could have in my backyard.

Benjamin Sparrow: I do not want to say anything about their project. being lesser good. Everybody knows that the Saltan Sea is a very complicated resource. So we’ve only talked about a few metrics. Then there’s all of the other chemistry in the soup. So is there H two s in your water and does that need to be managed?

What happens when you depressurize your. are there naturally occurring, uh, radioactive materials, norms in your water and the Saltan Sea? It’s a very interesting resource, but it has a lot of stuff in it and that’s why it’s fantastic that the doe and companies like Berkshire Hathaway Energy, there’s companies like, um, ESM and others.

controlled thermal resources are all working to solve that problem.

Antoine Walter: If I zoom out from my very particular case, which I know cuz I really tell now too much, but my, my father re retired end of last year and he’s only project he’s still pursuing is getting. Critical waste out of the ground. Mm-hmm. . So it’s like really now the, the goal of his life is to get that down. And, um, and he thought that maybe if I can find some use for that lithium, it could, it could help.

So long story short, what I’m wondering is that, is there these kind of lithium reach resources a bit everywhere and we just never looked for it. .

Benjamin Sparrow: So there is lithium everywhere. Um, and I’m, I’m not sure that we’ve never looked for it. People have been aware, but now because of high lithium prices, people are coming increasingly aware.

Uh, again, I come back to there are no shortage of lithium brine that can supply the world’s needs. It’s just a matter of permitting them and building the plants.

Antoine Walter: So assuming I, I get the permits right, assuming I order all the systems. A ideally company, you’re gonna recommend me and then hold the c r t from from you.

What would be your expectation in terms of timeline? When can I be up and running?

Benjamin Sparrow: So I’ll set permits aside because I don’t understand them. Um, and we’ll assume you have Brian disposal. You’re probably looking, and if you, and, and, and the money’s available, you’re probably looking at about four. and, uh, you’re probably looking about a, at a cost of production from a process equipment standpoint, coupled with chemicals and energy, about $10,000 a ton.

Antoine Walter: So with today’s spot market of 70,000, I have a good potential to make a good profit. Yeah, you still need

Benjamin Sparrow: to build a building. You need to do other things. , but that’s the process equipment, the core of it. DLE plus crc, $10,000 a ton, not what some people are seeing on the stock market.

Antoine Walter: Okay, so that might be the last episode of this podcast because right now I’m changing gears and , I’m becoming a dle, uh, uh, a GLE play.

But, uh, thanks a lot for having taken the time to, to study with my, my stupid little project.

Benjamin Sparrow: It’s not stupid. It’s fascinating. And that’s great that you’re out. Um, innovating and hunting. , you may be onto something. You may not want to publish this podcast.

Antoine Walter: No, I sure want to publish it. Uh, I have one more question on that, that that market, which is, I joked a bit about Warren Buffet being involved in, in the Saltan Sea.

Bill Gates is involved with Lilac. Mm-hmm. . Um, is there like a move from. The eighties and nineties, big guys, big innovators or big financial persons to, to now be looking specifically at that lithium topic.

Benjamin Sparrow: I don’t know. Um, I honestly don’t know. It’s, it’s great that Bill Gates is out there spending some of his money on, uh, technology through Breakthrough Energy Ventures.

Um, others are too. All right. So, um, lilac is a, a good DLE company. There’s another one Summit, uh, nanotech based in Calgary. They’re both generation two DLE companies, uh, both working very hard. And then you have the generation one DLE companies and they’re all receiving a lot of funding and, and for a good reason.

Who would be the

Antoine Walter: generation one Letham companies? Uh, there’s

Benjamin Sparrow: esm. . Um, there’s, I, I need to be very careful here cause some of them are our clients. Uh, maybe people should Google

Antoine Walter: Okay. . Sorry, I don’t want to put you in that

Benjamin Sparrow: position. Yeah. But, but a shout out to all of the lithium innovators out there trying to improve lithium extraction technology to improve sustainability and improve the cost curve.

Um, there’s a lot of hardworking people and

Antoine Walter: if you can with a bit of a joking touch. Um, we all know that Elon Musk spent a hell of money on Twitter knowing that Tesla might be in trouble any time with lithium supply, wouldn’t have. I mean, now let’s imagine you are the richest guy on earth and not Elon.

Uh, would you invest in Twitter early lithium supply chain?

Benjamin Sparrow: I certainly don’t want to comment on Elon or or uh, Tesla because I have great admiration. I guess that for them. , yes. Uh, but. , I would absolutely be investing in accelerating lithium resource development and technology development. And I think you’re going to see the Canadian government, uh, do exactly that in the coming future with their critical mineral strategists as the US government has

Antoine Walter: that, that’s one thing maybe on, on the geo political side to, to come back a bit to, to that aspect of the story, the governments.

Pushing at different places. If you look right now, what’s happening in Europe, there’s a big push for battery plants, so gigga factories, and there’s a 10 to one ratio worldwide between what’s invested in Gigga factories and what’s invested in lithium. Spot on. Is it because that’s really the cost ratio, that’s a gigga factory costs 10 times more than the Liam supply chain, or is it because we are not.

focusing on the rights part of the supply chain.

Benjamin Sparrow: Y you’ve uncovered a, an imbalance that everybody who works deeply in the lithium sector is aware of. There’s not going to be enough lithium carbonate, lithium hydroxy to go into all of the lithium battery factories being built. It takes two years to build a lithium battery factory and a couple billion dollars.

It takes a lot longer to build a mine.

Antoine Walter: So it looks like my project has a good, , a good position in that market because thanks to you, I can be up and running in four. And the imbalance is here to stay. So it does, it does.

Benjamin Sparrow: Um, yeah, if, if you’ve figured out the disposal, if there’s brine disposal there, and if there’s good porosity, it’s very exciting.

Maybe I’ll quit my job and join you ,

Antoine Walter: then I’ll get you to Europe for that. Very good. So, um, , is there an elephant in the room I missed in that word of

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Rapid fire questions:

We are recording that. just one months away from the UN Water Conference. So I’m op opening with that. Rapid for a question. If you had one topic that you could put on the agenda of the un, what would it be?

Benjamin Sparrow: Um, stop putting deleterious matter into the rivers and lakes that provide healthy, long-term, sustainable drinking water. Protect the rivers and lakes. You end up protecting drinking water from millennia.

Antoine Walter: Is there anything in your job that you won’t be doing in 10 years? Uh, with,

Benjamin Sparrow: well, Is there anything in my job I wouldn’t be doing?

10 years? I think I already answered this one. Yeah. Sorry, I went off topic. Can we , um, try, try me again because I I have my, sorry, I lost it. .

Antoine Walter: Well, the promise that you, you got my traditional list, so I have to be creative. Yeah. Um, you can ask me again now. Let, let me, let me steal one from, from Joe Laurie.

That, that, that way it’s gonna be really and. And, and homage podcast to, to what the great work he is doing. I mean, really appreciate what he’s doing. Um, what’s your favorite movie

Benjamin Sparrow: right now? Taro. Don’t Know It. I have a three year old child, and she loves Taro. It’s a Japanese movie about a wonderful mythical being that takes care of children and, uh, helps ’em find their.

Okay.

Antoine Walter: I have to discover it because we are more a paper pick family, but . Um, and who would we, I mean, I’ve listed you all the people I’ve talked to with within that, um, I mean all the types of profiles I’ve talked to within that deep dive mm-hmm. , did I miss one of the aspects of this lithium value chain?

And who would you advise me to, to speak to next?

Benjamin Sparrow: I think it’d be very interesting to speak to some of the battery cycle. . So, uh, lifecycle, lifecycle redwood, um, they’re equally building lithium concentration, refining converting plants, but from waste feeded stock. .

Antoine Walter: Well, Ben, it’s been a pleasure to spend that hour with you.

I will put your links into the, the, the, the show notes of course, but if there’s anywhere else that I should redirect people outside of your LinkedIn and saltworks net websites,

Benjamin Sparrow: what would it be? I have a very small online footprint, so that’s exactly it. But, um, Saltworks is definitely open for business and looking to help accelerate the EV revolution with sustainable.

So

Antoine Walter: which kind of leads or customers would be the right fit? The ones which you wouldn’t know yet? No more,

Benjamin Sparrow: please. No more. Okay. ? Yeah, the, the cup is overflowing. Um, we’re just really deeply focused on delivering for the key lithium projects. Amazing. Yeah. So thank you for having me on your podcast and Thanks.

Thank you for helping to inform your listeners and let’s discuss

Antoine Walter: next year. Wonderful. Great.

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The post Why Water Technologies Matter in Lithium Mining (And Why You Should Buy Now!) appeared first on (don't) Waste Water.

What if your microorganisms told you live and 24/7 how they feel and what your effluent looks like?

with Carol Maxwell – CEO & Director of MICROrganic Technologies and a Founding Member of ENYA Funds 1, 2, &3

with Brent Solina – CTO of MICROrganic Technologies

MICROrganic Technologies builds a Microbial Fuel Cell platform that aims to change the way the world deals with wastewater.

What we covered:

How Microbial Fuel Cells open a new paradigm in plant operation – the era of bacteria that can communicate and interact with your Google Calendar

How limited we are today, with our chemical tests and lab analysis

How we don’t know much about the root cause of most of the upsets a wastewater treatment system encounters

How Microbial Fuel Cells work and how their core characteristics trigger the operation opportunity we just described

How wastewater treatment blowers represent 3-5% of the US’s energy use and how microbial fuel cells could enable turning them down

How microbial fuel cells could represent an overall decrease of 85-90% in energy use

How beyond today’s benefits of microbial fuel cells, there’s even more to come tomorrow with for instance microbial desalination cells

How MICROrganic Technologies’ VIVA modular series could be the fundamental brick for those future applications

0⃣ How it all boils down to a fundamental feature of Microbial Fuel Cells: they set the path for a decarbonized wastewater treatment

How MICROrganic interacts with companies and acceleration programs the like of Xylem’s Innovation Labs

How anybody can take off a start-up, assuming you’re creative enough and push hard enough.

How you can learn sales and marketing the hard way, and how that’s beneficial to aspiring entrepreneurs.

How the bottleneck to turn MFCs into a large-scale solution lies on the cathode’s hardware – and how MICROrganic strives to solve it.

How building an MFC is very close to making a battery – just with additional constraints, using wastewater as a fuel

How large and small plants have different challenges and how that reflects in their KPIs.

How MICROrganic’s product works yet isn’t fully ready for commercialization – and what the next steps are.

Wastewater being liquid composting, wastewater containing 7x the energy needed to treat it, VIVA being the size of a refrigerator, MFCs powering predictive maintenance and potentially decentralized systems, VIVA being a kind of biosensor… and much more!

… and of course, we concluded with the 𝙧𝙖𝙥𝙞𝙙 𝙛𝙞𝙧𝙚 𝙦𝙪𝙚𝙨𝙩𝙞𝙤𝙣𝙨  

Resources:

Send your warm regards to Carol on LinkedIn

Make sure to also reach out to Brent over there

Visit MICROrganic Technologies’ Website

is on Linkedin

Antoine Walter on LinkedIn

Teaser: Digitized Microbial Fuel Cells

Infographic: Microbial Fuel Cells that fill your Google Calendar

Full Transcript:

These are computer-generated, so expect some typos

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Antoine Walter: Carol. Hi, Brent. Welcome to the show,

Carol Maxwell: you for having us.

Antoine Walter: you’re two on one. So be kind with me, I’m alone. Jokes aside. We’ll be exploring today a topic, which we scratched a little bit on the microphone in the past, but which is really amazing. It’s one of my recurring theme to say that wastewater is actually liquid energy and you’re actually walking that talk and you’re turning wastewater into energy, but we’ll go to the nitty-gritties of that and try to understand a bit more what you’re doing yet.

We have traditions on that microphone and that starts with a postcard and you’re sending me a postcard today from Albany. So what can you tell me about Albany? Which we, you ignore by now?

Brent Solina: It’s a Albany again easy to point out. We’re about three hours north of New York city. So we are in New York, but as I mentioned part of this interview, we had horses going past my front door here. So certainly not Manhattan. It’s a wonderful area to work. We are an hour south of the Adirondacks an hour north of the Catskills and an hour west of the Berkshires.

I will say there’s a lot of industrial manufacturing resources around here. One of our biggest challenges has been Albany has quite a bit of fresh water and cheap power and that has made our lives difficult at some points. Despite what a blessing that is

Antoine Walter: Brent. You’re the CTO of MICROrganic. Carol, you’re the CEO of MICROrganic. Is it a good start and a good opening question to ask one of you to give me the elevator pitch to MICROrganic?

Brent Solina: Sure.

Carol Maxwell: Yeah.

Brent Solina: I think that’s more your domain,

Carol Maxwell: Okay. All right. Well, MICROrganic technologies is a young company. That’s developing microbial fuel cells for very high energy efficiency, wastewater treatment. And basically the technology reduces energy use and secondary treatment by about 85 to 90%. It also generates clean DC power and it creates real time process intelligence on what’s happening in the system continuously.

And as far as we know, there is no other technology that can provide those benefits.

Antoine Walter: Carol actually to get to know you a bit better.

You’re a bit of an outlier in the list of entrepreneurs I had on that microphone, because usually you see technical people or you see people coming from a different industry, which are then bringing something which works somewhere else and bring it inside that industry.

And you are from a sales and marketing backgrounds, which is a bit less common. Let’s say.

Carol Maxwell: Yes.

Antoine Walter: does that bring to the.

Carol Maxwell: Well, first of all I have done other things than marketing and sales in college. I was a biology major with also a lot of chemistry and physics. And I started out after college in a PhD program. And then I realized I didn’t want to be in academia. And so I bailed but because of my biology background, I ended up my first real job was with Eli Lilly and company, the pharmaceuticals company, and At that kind of company, unless you’re a lawyer or a scientist, a bench scientist that company makes you what they call a, carry a bag.

In other words, you have to meet customers and get sales. And that was something that I was a little miffed about when that happened, but actually it was a great entree into learning about, how do you sell, how do you do a bad job at selling? And and so I went from, okay, I’ll take this job to actually loving it.

And it gave me a lot of exposure that I wouldn’t have had. So I’d say that sales and marketing is a pretty big part of any company. If you don’t have sales and marketing, you’re not going to make very much money. So that’s where I bring a lot to the table.

Antoine Walter: the other end Brent, you’re if I’m right straight out of technical and research background into MICROrganic, what’s the story there.

Brent Solina: Yes. Started as a undergraduate at Rensselaer Polytechnic Institute here in Troy, New York. My original focus and my academic focus was actually in protein, folding. So how enzymes get their shape and function? As part of my undergraduate experience I started working with a company by the name of eco native design that is doing a biopolymer production from mushrooms.

And when we started, they were very early stage. That’s kinda how I got the itch for the startup world, because to be quite Frank, I could see them meeting problems, head on and stumbling through the growth process. And that’s when it hit for me that anybody can do this kind of thing if you’re creative enough and push hard enough at it.

I had originally started doing the kind of student business plan competition circuits around on-site composting for reduction of food waste. And of course in food waste, it’s equally important as it is in wastewater that you have energy efficient aeration which is how I had stumbled on to, this absolutely amazing technology that we’ll be talking about.

Antoine Walter: When as they stumble upon, what, how do you stop stumble upon.

Brent Solina: Well, so again, in food waste and in composting, there’s a lot of energy just like in wastewater that is spent providing the air to avoid a anaerobic condition and get proper breakdown. I always like to say that at the end of the day, wastewater treatment is really just liquid composting.

It is of course, just a lot more difficult to get oxygen into water than it is into a pile of compost. So in exploring that I read about microbial fuel cell. Which, as we’ll talk about just sidestep the problem altogether.

I was able to see that and look at, the microbial fuel cells ability to essentially provide aeration through wire and avoid, all of the blowers, everything that was associated with that.

And, that really drove home to me, what a new piece of technology this was, and just a complete paradigm shift within the wastewater treatment space.

Antoine Walter: to finish and round off that, that introduction, how do you get work together? Carolyn Brent w what’s the encounter and how do you feel that’s the right way to develop that thing to.

Carol Maxwell: It was kind of capricious that we met. I still belong to in an angel group, in the Albany area. I think we started in 2008 or 2010, something like that. And one day one of the guys that was the founder of it, he brought in Brent and he any immediate, it was our first meeting, I think.

And he just said, I want to introduce you guys to, to Brent here, because he’s been working on this. And I think you were maybe still at RPI at that time. I’m not sure Brent, but

Brent Solina: right towards the end. Yeah.

Carol Maxwell: yeah. And and the guy basically said, okay, we’re not ready to invest in them now, but we should keep an eye on him because this is really exciting. And most of the people in my angel group are lawyers or things like that. They don’t have a lot of technical knowledge, but as a biologist, I was like, I want to hear more about that. And so we started talking and then eventually it got to spending more time with him and we expanded a board. And then somehow I became CEO.

Brent Solina: I’d like to, expand on that a little bit. If I can. We essentially, I started just by starting. Oh, another thing that really attracted me to this technology is at the end of the day, it being wastewater means it’s a mixed culture, so you have no need for, a sterile, clean room environment.

The materials are inherently low cost because, they have to be scalable. Right. And that really lends itself quite well to just early experimentation and figuring out what the technology development plan is. So, that all immediately made sense to Carol. She saw the same thing I did, which is saying, at the end of the day, All chemistry, including biochemistry is electrons moving around.

And this is a natural way to kind of tap into this whole notion that life is electric and it real big way to address a problem here where the bottleneck for the technology appeared at that point. And, in large part still is large scale manufacturer of some of these components.

Carol Maxwell: You should make a really short story about the.

Brent Solina: we’re kind of glossing over a whole part of our history here where, you know, like I said, we started just by. So before Carol was really involved I was doing quite a bit of that out of my apartment very early on. I had my concerns at times about people’s reactions to the glassware and the windows and, what they thought it was really doing in that lab there.

And at a certain point I realized that just wouldn’t work and, Albany and Troy in particular hosts, quite a lot of creative startups and it turned out I wasn’t the only one who was trying to use my apartment for things that probably shouldn’t have been used for. And we were able to put together the Troy center of gravity, which was, maker-space back when that was still a relatively new of.

I remember having to explain it to people as a heavy metal gym, that you pay a membership and you get to use the machines, now people understand the concept, but at that point it was still pretty new. And I’m happy to say that has since expanded. They have a beautiful new facility.

They continue teaching classes to this day and it’s, know, it’s a wonderful asset for the community. Similarly, early on, we were engaged in a great program with, of all things a local school district, they had a population decline, but you know, we’re looking to get utility out of a building that was mostly empty classrooms.

And so they started offering that space to start ups and exchange for us, participating with their academic curriculum. So it was a wonderful way to teach some of these students and. If we have our way, some of our future employees one day maybe about this brand new technology that, frankly some of the folks at the PhD level, we’re still kind of struggling to wrap their heads around.

So, certainly an interesting origin I’d like to think,

Antoine Walter: Talking of this technology. I have a stupid and simple question to open the deep dive, which is your very first actually Reacher. I mean the very first startup accelerator you went through was an energy one. And you said life is electric after all. So are you in the energy sector or are you in the water?

Carol Maxwell: We’re in both. It’s impossible for us to pick which child is the right child.

Brent Solina: And on the subject of, energy for microbial fuel cells the stat that gets kind of bandied around a lot is that there’s about seven times the energy in wastewater than it takes to actually process it. So clearly there’s a surplus of energy there to be had. Again, what was very attractive to us about the technology is there’s a very natural progression to the life cycle.

We have an immediate value opportunity in the ability to turn off the aerators. And while we’re laying the technological foundation for power generation at a future again, it’s part of what led to our overall process and our focus on development is that there’s a very rich and active academic community exploring, every nook and cranny of what this technology can do.

And we’ve sort of taken the mantle of, manufacturing full-scale systems to act as a platform for everything that community’s working on as we move forward.

Antoine Walter: if I get that right, that means that there’s a lot of academic research about MFCs. So microbial, fuel cells, what was missing. So, so this this part of the chain, which was missing was how to execute on it, how to make it, how to turn it to real, how to industrialize it. And that’s the challenge you wanted to solve?

I oversimplifying it.

Brent Solina: No. I mean, it’s actually surprisingly simple but in retrospect, again, it’s a incredibly interdisciplinary technology and a total paradigm shift for the wastewater space. So what you saw is that despite all of this wonderful bench scale data and everything, the academic community was, leaning hard into solving.

There was still this handoff that was missing between academia and industry. To put it simply there just weren’t the components to build larger reactors. Everything was handmade. There are a couple of researchers that I know very painstakingly went through fabricating some of those components, just by hand so that they could do larger studies, but of course, industry wants to see larger scale pilot.

And, you’re not going to get the funding to start researching manufacturing techniques of these critical components until that pilot’s there. But to do that pilot, you of course need the large scale components. So that was this very chicken and egg problem that we just kind of dove head on into and said, okay, nothing is going to get solved here until we figure out how to scale specifically the cathodes.

Carol Maxwell: Well, that is true but there is also, Brent is being a little optimistic about that because in a way, I mean, there were lots of researchers that were trying to create materials, but as far as we know there hasn’t been any real academic success regarding the materials themselves. And so a lot of what we were doing very early on in the company was figuring out what is really the right materials that we need to make the cathodes themselves, because that’s really where it all has to happen.

We had to have a plan to have it be workable in industrial situations, not at lab. And that took us quite a bit of time to really keep perfecting that. And I think we’re still kind of perfecting our materials now.

Antoine Walter: I liked when to understand that material elements. first for the people listening to that, I know it’s sometimes difficult when we discuss technical topics too, to figure out what we’re exactly discussing. So I’m linking in the show notes to very good webpage of MICROrganic, which is explaining how all of that works.

I mean, I’ve seen websites describing that process. I’ve never seen one, which was so much straight to the point and easy to digest. So if there’s one you need to read about that, it’s that one, it will take you two minutes and you will get it. basically in a microbial fuel cell, you have an anode and you have a cathode and if I get your rights, the tricks so far to scale things up was the cathode side.

What’s did you find out and what are you doing differently? Which somehow solved.

Brent Solina: first yes, you’ve got that. Exactly correct. And for those of us that are listening right now and unable to click on the website at a very top level, a microbial fuel cell features, as you just said, an anode and cathode with a community of microorganisms on the anode who are using that as part of the respiratory process, they push the electrons into the anode, those electrons flow through an external circuit onto the cathode, which then transfers that electron to atmospheric oxygen in the air.

So from their perspective, it’s just like, they’re breathing, using oxygen. The only difference is that their electron transport chain is literally a electron transport. Why. So we, that’s where I often describe it as a electric chemical snorkel. It allows the microorganisms to respirate using oxygen, do a aerobic metabolic respiration without ever coming into contact with the oxygen, which of course means no blowers.

So to your question on, the challenges around the cathode, a huge component of it was just simply physical scale. When you’re looking at uh, equipment that needs to be in aeration basins, that can be, acres and acres large, and forgive me, that’s not metric. But the, you need physically large cathodes to be able to do that.

You can’t be looking at installing, hundreds of thousands of these small electrodes and then maintaining all of them. I think it’s also important to remember the context in which all this was happening. Right now, we’re used to fast charging cell phones and, batteries have grown just at light speed over the last 10 years.

But when we were starting electric chemistry was still largely a dark art. You certainly didn’t know, even in technical fields, unless you were in electric chemistry terms like activation losses, mass transport losses, that was not something that people were familiar with. And again, to what we were discussing with Carol, we’re going to people that are in wastewater, pretty far removed from electrochemistry, talking about the challenges we’re addressing at our cathode and using these electric chemical terms that were just, not on anybody’s radar at that point in time.

So the challenges with the cathode one was, the physical scale too, is that, while we are living battery the electrolyte we use is sewage. So we don’t get the same kind of trick playbook that a battery researchers and manufacturers do, where we can use things like phosphoric acid and where they just have this really tight control of the chemical environment.

Certainly anybody in wastewater will say it’s, anything but consistent. So you know, that really curtailed the number of catalysts that we could be looking at. It curtailed the kind of materials we were looking at. It really shaped the kind of geometry we were looking at, which in turn also drives the physical manufacturing process.

We’ve tried a number of different, large scale manufacturing platforms before settling on where we are now. And that was the biggest change.

Antoine Walter: So going to the end of the story. So I’m really now fast forward into the results that ends up being Viva, which is your product today. The reason why I’m fast-forwarding is just to understand that step. You said that you don’t want to have thousands of of small size MFCs, which you would have to fit into your treatment.

How much wastewater can you treat at once with one Viva unit to get a sense of scale?

Brent Solina: Yeah. So, the scale that we’re at right now, we’re doing about, 400 gallons a day at Anheuser-Busch. What’s important about that? Pilot is the retention time that we have it set to right now is about half of their current process. The, to give you an over all sense of the scale of the unit.

It’s, if you could picture something roughly the size of a refrigerator that features both the anodes and cathodes in a cassette, similar to how you might look at a membrane filtration module that is sitting in the tank at Anheuser-Busch. So that module could likely support a much larger tank and as a result, a much larger footprint.

But that is, the kind of size constraint that we went with for this pilot.

Antoine Walter: Okay. So that answers my question on the size. And that gives me a hint with your retention time, that divided by two, towards the. The advantages of your solution against the status quo. And who gave us in the individual picture. We did some hints, Carol, but now really circling back to the challenge we have to solve in the wastewater industry.

Out of all of those challenges, if you had to pick only, I’d say three, which are the three top challenges, which you can solve with MFCs?

Brent Solina: First and foremost it’s turning off those blowers. That is depending on which stat you go by here in the U S that’s somewhere between three and 5% of us energy use goes to running those blowers. And again, I think that stat is a bit inflated, but it’s clearly a very large problem.

And there’s knock on effects to that. Those blowers require quite a bit of maintenance, quite a bit of, service as they go. They drive not only the energy requirements of the plant, but the power requirements. So, you won’t see even a small wastewater treatment facility that doesn’t have a significant power station support.

When they turn those blowers on and off, they typically have to let the power company know because of the effects it has on the grid. So, over and above the actual energy use, there are huge implications of the power that’s required at those facilities. I’d say the second and it’s one that we, address quite handily with by monitoring that electron flow.

It’s just process intelligence. Wastewater, you’re typically looking at daily lab workups biology typically, isn’t nice enough to tell you how it’s doing. And this internet of things age we’re so used to, being able to check whether or not the Oven’s on from a continental way.

But you know, microorganisms don’t typically use Twitter. So we’re able to monitor that electron flow. That again is coming directly from the respiration of the microorganisms. And that gives us a real time indicator of how healthy our bioprocesses

Carol Maxwell: it’s also though important to mention that that is a key component of it. But in addition to that the potential in both the cathodes and the anodes gives you additional information that normally you wouldn’t have. And for example, if the potential starts to go down, exactly where it’s going down, like by the park, by, by the actual piece of equipment itself, now we haven’t really experienced that, but at some point we will.

And you would know if there was a part that wasn’t working properly and you’d be able to identify it specifically.

Brent Solina: well, we haven’t really experienced the part failure. I can tell you just this morning at Anheuser Busch we had an issue with one of our circulation pumps, just one of the breakers flipped in the building. And I was able to tell that half a state away right there on our dashboard, more importantly, I knew it wasn’t a biological problem.

So. Again, if you look at our implementation strategy where you have these cassettes that are all just dropped to an aeration basin, like Carol said, you would be able to look at that readout, know which module and which electrode needed to be pulled, brought a shore, maybe examined. And there’s two important things about that.

One is, as Carol said, you know exactly where the issue is. And to while you’re fixing that one module all the rest of them are still working. You don’t need to drain the tank. You’re not looking at a major process disruption. It very much streamlined maintenance.

Antoine Walter: So you had number one, turning off the blowers. Number two, process intelligence. What is your number three?

Brent Solina: you know, if I’m dragging myself outside of microbial fuel cells for a second, I would say actually the third biggest problem within specifically wastewater treatment right now is one of policy and optics around water reuse. You see a growing push for what I’ve seen sometimes called the pure water movement a toilet to tap or at minimum aquifer recharge.

It is outrageous to me that we spend all of this time, energy and money and just generations of solid engineering, making sure the water that leaves a treatment facility is as clean as it can be. And then we don’t use it, that should be a more closed loop process. And, we should be more conscientious of where the water that’s leaving.

Antoine Walter: But you’re cheating here because you dragged yourself out of MFC. I want you to have challenges that you solve with MFC. So. The third one

Brent Solina: Absolutely. In that case, then if you’re sending me back down into

Carol Maxwell: know where you go in now.

Brent Solina: I won’t even call it a challenge. What I would say is the most exciting opportunity about microbial fuel cells is that electron flow and separation also allows us to do energy positive desalination. That is not, something that we’re actively pursuing right now.

We are very excited about some upcoming opportunities with Xylem and our ongoing pilot with Anheuser-Busch. But again, the ability to desalinate water and do so while generating electricity and processing waste is just, I mean, that’s the holy grail of the value proposition as far as I’m concerned.

Antoine Walter: I’ve seen a presentation about that last week, so let’s call it serendipity and. I was surprised because the presentation sounded to me like really the kind of things, which is an awesome application of the seven to one ratio, you mentioned a bit earlier, I mean, this energy positive potential of wastewater.

And what surprised me in that presentation is that the horizon that we’re giving for the rollout of the technology was something like in a decade or two. And it was like, okay, but we needed today. And I don’t see what prevents us technically from doing it today. I mean, I’m not saying it’s easy, not my point.

I’m just saying that. Yeah. If we want to advance the stars, it sounds like something that we shall be pursuing right now, but I don’t want to sidetrack you here. It was just my gut reaction.

Brent Solina: No. And without getting too deep into microbial desalination. But that does tie into my previous point where with everything this technology does, it was so critical to develop a platform and, that’s the story that we’re looking forward to eventually being a part of is that with our ability to make these electrodes at a large scale, that gives folks that are doing the research right now, a target to hit with our modules, it goes from a kind of concept of, oh, a microbial desalination cell can do X, Y, and Z.

Well, now they can picture our modules and we have a platform that, we would love to try that kind of stuff with in the future.

Antoine Walter: Let me dive a bit deeper into you, your first advantage, which he says turning off the blowers. So that is the 85 to 90% energy reduction, which you hinted to Carl at the opening of the discussion.

Carol Maxwell: Correct.

Antoine Walter: so that’s the potential. Now there’s something in what you do is that you have this a aeration without air trademarked to cite your website.

I love how you trademark it. That, that one. So you’re still a rating a little bit. And if I’m right, that is for denitrifying?.

Brent Solina: It does help with the simultaneous nitrification and denitrification. But the small bit of air we do use is, our cathode, because it uses atmospheric air. The cathode has to have air on one side and water on the other. So the question becomes if you want to drop in solution.

How do you keep essentially a wall of air on one side of that electrode? And the answer that we came up with was we essentially have a window frame that has a cathode on both sides, and that creates a sealed pocket of air that we occasionally sort of refresh the air content of. So while we don’t completely eliminate the aeration, you are moving air through air it’s at a much lower pressure.

And you avoid any of the issues around oxygen transfer efficiency, because again, you’re not putting that air into the water.

Antoine Walter: But doesn’t that turn your cathode into a membrane aerated biofilm reactor?

Brent Solina: So it’s interesting you bring that up. A lot of the MABR companies, if you look far enough back did originally have some microbial fuel cell DNA in them.

Antoine Walter: I can quote you Gilad Yogev from that microphone on that he said MABR is what we did while we were busy doing MFC.

Brent Solina: Yep. That sounds about right. And, I’ve met some of the folks at OxyMem and some of the others, and, they have some really interesting stuff going on. And early on, this may have been before Carol even stepped in, we had looked at that, just like an MABR it’s critically important that we do that gas air to liquid transfer.

What is an added layer of complexity and perhaps they were a bit smarter for going after the lower hanging fruit. First is adding that electric chemical aspect taking that gas transfer membrane and then getting a electric catalytic surface attached to it and figuring out how to manufacture that was hugely challenging.

So again, if you go far enough back for a lot of the MABRs, it’s a very tempting path to go to say, Hey, we got the oxygen transfer going let’s, maybe not do the electric catalytic part right now. And, but we wanted the breast ring.

Antoine Walter: Very clear. I think we have a good overview of the technical side of it, and I like to go a bit deeper in a minute on the process intelligence, but I’ll keep that in the fridge for now. What I’d like to understand is something which would surprise me is that you say that your solution works for high and low strength.

Most of the time we see this kind of processes tried out in high strength, wastewater. What makes you confident in the fact that this can roll out, in low strength, wastewater, and what’s your different take at at that matter to be so strongly differentiated there.

Brent Solina: I can say we’re confident, low strength waste. That’s an easy one to answer

Carol Maxwell: Well, we’ve done it.

Brent Solina: Yeah, there’s that same mind again. Again, being up here in the Northeast United States, a lot of these plants and infrastructure tend to be combined as well as fairly aged at this point.

So, we had a really great host in the form of the Pittsfield, municipal wastewater treatment plant. It was an excellent pilot. We did that for, just shy of two years. But they had a pretty low strength waste due to primarily a lot of the infiltration that happens within, their sewer system.

So I will say that isn’t something that we shot for, but it was nice to get that data. And at the end of the day, our approach to sizing I think is still relatively different to what a lot of other folks do. Our Viva module, in addition to the treatment it’s providing directly really helps to stabilize the effluent around it.

So we kind of have this combination of fixed film and a free-floating treatment going on, which for lower strength waste, it brings it pretty similar to what you’d see for either a, an anoxic or return activated sludge process.

Antoine Walter: So it can strive in many environments and there is many playgrounds for Viva yet. Let’s really now a business model and sales question. What is the ideal configuration where you say, okay, if that happens in Viva is the obvious better solution than whatever existing out there.

Brent Solina: I think, at this point, the advantage of the technology, the larger the plants, the more they’re going to care about the energy savings certainly at smaller plants there are enormous benefits but you know, saving a $10,000 at a very small plant is not going to be as interesting when, something’s on par with like, let’s say resurfacing, the blacktop that they have.

Antoine Walter: So it’s really a matter of size. The decisive factor is size?

Brent Solina: Yes. And I’d say, as we get into smaller facilities and especially food and beverage onsite the smaller facilities, do get excited about the energy savings, but the process intelligence just becomes absolutely paramount. If you look at a brewery that will typically have a small package plan onsite, they probably don’t have a full-time person dedicated to just maintaining that equipment.

Because typically, those packaged plants will operate without intervention really well until all of a sudden they don’t. So while they are interested in our energy savings and especially around brewing, we see Just a very strong appeal of just good water stewardship. Having that data intelligence, lets them focus more on their other operations without worrying that they’re about to be in violation of their permit.

Carol Maxwell: And to kind of go along with that, when you’re in that kind of situation, where there is something that is going a little bit. It’s not looking right. In general, a plant wouldn’t really necessarily even have the scope of data that they would get from Viva to really understand, like, where is this coming from? Is it a biological problem or a mechanical problem? There’s a lot of, kind of, getting down to the nitty gritty that you can’t, if you only really have in your hand, just taking some chemical tests.

Brent Solina: And, similarly that chemical sampling for, food and beverage facility that may not even be happening once a week, maybe it’s every other week. And I said at the, kind of the top of the interview that, biology doesn’t use Twitter ours can right now we’re focused on, interpreting the data and collecting it.

But as we start to round out the software we can absolutely have it so that the bugs not only let you know, Hey, I need some help here. But they can contact your operator and set up a calendar invite for you. That’s shows up right on your Google calendar with no intervention.

Antoine Walter: how far did you go with this internet of wastewater?

Brent Solina: Oh, I like that. Can we still do it?

Carol Maxwell: We better trade market right away.

Brent Solina: I would say, right now we are still collecting a lot of the data. We make extensive use of what we’ve started calling a red, yellow, green kind of traffic light system. As we expand, our piloting efforts with Anheuser, Busch and Xylem we are looking at potentially employing some more big data approaches.

There’s just a ton of information. And while I said previously that we didn’t get to borrow a lot of the tricks that people are doing in traditional electric chemistry, like batteries. A lot of that signal interpretation is immediately applicable, and there’s a huge body of academic research that’s growing in terms of being able to identify specific compounds what compounds are going to be made if you poise the electrodes at specific potentials.

So similar to our scale-up strategy, we are very happy right now to just get a glimpse into that world, but there is a whole treasure trove of data to be had there.

Antoine Walter: So if I try to unpack that means that you’re going right now through test and learn at your pilots beachheads plant at Anheuser-Busch. And right now your wastewater can already set things in your calendar, which is already crazy when you think of it and down the line, there could be much more about it.

Brent Solina: Yes. Yeah, absolutely. If you look at the growing field of bio electrochemical, biosensors essentially every one of our electrodes is that, so, again, we focused on getting this workhorse of treatment done. But we benefit from that body of knowledge. And clearly, there’s already a market poll that people really like what that field has to offer.

Antoine Walter: You mentioned Anheuser-Busch, which is very clear to me. It’s the one producing the wastewater, running the plant probably the site where all that is hosted. You also mentioned Xylem. What does Xylem do in that equation?

Brent Solina: So we are part of the Xylem innovation lab, which is a combination accelerator and incubator. And we’ve been working with them to identify a future pilot. And our hope would be, again, that our Viva module can be specked into their product offerings at a future date

Antoine Walter: by the time this interview will be out. My interview with Sivan Zamir will be out as well. So, you see, I didn’t know at all that those two stories were connected, but it’s interesting how those dots are always connected. So it’s also a good example of how it takes a village to solve the issue.

Brent Solina: oh, absolutely.

Carol Maxwell: And I would say that and she’s probably going to talk about it as well. They’ve created this kind of lab with companies that they think are very of great interest to them. And they are really looking beyond just kind of typical incubator accelerator type of experiences. We’ve been getting a lot of very interesting insights and support from some of their engineering teams to help us because, we have a product that works, but it’s not really fully ready for commercialization.

And so being able to get some of those insights as a very small company, we don’t have, has been extremely beneficial to us. And I think everybody else in that cohort too, they have, I think at least 25 or 30 companies in there.

Brent Solina: It’s just been an absolutely fantastic program. And I would like to take a minute to say, if you’re listening to this and you’re an aspiring entrepreneur in the water space these incubators and accelerators have gotten, much better over, I’d say even the last five or six years.

And our experience with Xylem has been phenomenal and I cannot recommend that enough.

Antoine Walter: It’s interesting because that could become a series right now because I also discussed I mean, just to the episode before this one should be the one with Scott Bryan, from Imagine H2O. And we discussed all of evolution of all the programs and everything around the startup ecosystem.

But if I go into that and really decide tracking you, so let me bring it back on track. Actually my question here would be how committed are you Viva and MICROrganics towards the biggest scale. And it sounds like a weird question. Let me let me unpack it a bit. Actually, if you look at the timelines in the water industry at the stage you’re at, you would predict that your technology shall be in the middle of the market in 15 or 20 years, assuming you stick to it and you do all the right moves first, do you believe you can speed up that curve and go against all the odds and all the historic rollout of technologies, which have happened over the past 50 years?

Let’s say. And second, if you have to endure that timeline and this conservative industry, are you ready for that?

Brent Solina: practically. Yes. I think some of the timing. You know, It was always a bit subject to debate. But certainly 10 to 15 years is right out of the question. And frankly, we collectively, as the human species don’t have that time. And I think, there’s two things coming together.

You’ve got a increase in pressure on, companies to really get their carbon footprint down as well as just general resource constraint. And then to, without going back down that path that we talked about and looking at the whole startup ecosystem, I think the water industry is doing a much better job.

Reaching out to earlier stage companies and more novel technologies. Everybody knows water is hard. Hardware is hard and water is really hard. But I think, through these programs, like the Xylem and incubator, what this other accelerator, the AB InBev accelerator that we’re in with Anheuser Busch I think you’re seeing the industry start to smooth out that valley of death quite a bit.

And realizing that they have to play a part in getting these technologies to market.

Carol Maxwell: I don’t think there’s a really good, totally established pathway for going from where an early stage company is out, especially in the water space, but you know, it is kind of consistent in working now with both Xylem and Anheuser-Busch, Anheuser-Busch continuously tries to reinforce with everybody in the cohort.

That’s there right now that they really want to deploy new technologies sooner, not later. And they’re not super risk averse about this. And they understand that, they live with having to deal with wastewater all the time, but, we weren’t just like one outlier in that cohort and the same with Xylem.

They they are really taking a lot of x-ray looks at what we do it’s not like some incubators where they’re just trying to help you get better. They’re really looking forward and to try to figure out how can we integrate that? Earlier rather than later. And so I think that there are ways to do that.

And and in fact, even potentially in the municipal space, they’re not saying we can’t do that.

Brent Solina: That is all sort of at a top level. But you know, your question was, what are we doing to shorten that and what are we doing to be ready to get, this technology everywhere on the planet. And the answer is, what it’s always been, which is focused on large scale manufacturing of this critical component that just does not exist right now.

When we started looking, the manufacturing process was as much of a design constraint as everything else, we prototyped on platforms that let us make these electrodes that didn’t care if we were making one or a million. And I’d say right now we’re in the home stretches of, putting the final touches on that.

But again, when we buy materials even if we’re just trialing it by, in five gram quantities, we buy it from a vendor that can get us. I have a bunch of activated carbon that frankly we won’t have a use for it because I didn’t like the lab results and I could only buy it in 50 pound sacks.

So, in the same is true with, again, the equipment we use this is all readily scalable and in a lot of ways already at scale whether or not we have the manpower to run it 24 7, or, a willing pilot site is a different story. But we built even our prototype manufacturing with an eye towards rapid scale-up.

Carol Maxwell: and it is also important to remind us that. the space of water right now with the technologies that are widely available. There are a lot of places on the planet that don’t have power grids to be able to deal with even the more efficient aeration systems. They just don’t have that. And so, I think that’s a pretty big impetus both in terms of human safety and sanitation and ecosystems, that it’s really important that has to be addressed.

Antoine Walter: I’ll take the two ends of your answer. Starting with just said, Carol. I had the discussion on that microphone with Stephane Bessadi from the Asian development bank and what the Asian development bank has been doing is that they’ve been looking at how much energy is available on the grids and how much of the wastewater still needs to be treated.

And there was a problem which was that if there were two to reach a full coverage, in terms of waste water treatment, they had an energy problem. So they created a tool which is called a screening tool for the energy evaluation of plans, and actually the seven to one figure that, that you reminded us at the beginning of the discussion.

Brent is part of that tool and of the note, which comes with it because they have a strong hint and incentive and technologies which could be tapping into this chemical energy of wastewater and say, we need that because if not, we will never strike a balance. So energy a clear part of that equation.

There’s something which is surprising to me. And that’s the beginning of the answer you gave me, which is you said the strongest driver might be carbon footprint, and I’m surprised that this comes 50 minutes in because when I see what’s your technology does, to me, it’s the obvious number one asset.

I’m not saying that carbon has yet the place at the table. It should have. And every time I mentioned carbon in that microphone or put it in a title, it’s the only case in which I have haters on that podcast, which come to me and tell me that climate change is fake.

But again, I’m not sidetracking here. What I want to say is that in your short resume of what Viva does you emphasis how you’re not going through the methane step. And methane is awesome. If you can leverage its energy, but is horrible. If it gets to the atmosphere, which we do know that the brown Jack quizzes have that little tendency to, to push methane and to the atmosphere and same with NOx emissions.

So to me, I would have expected it to be like the number one. Like, I asked you where are the challenges you can solve with our technology and say carbon something else. No, actually carbon and everything then a byproduct. How important does it become in your discussions with your partners, customers, prospects, that carbon element.

Is it really something you put that on the table and say, Hey, let’s meet in 2030 because that’s going to be a killer by then, or is it really an argument which becomes to be effective?

Brent Solina: It’s starting to be more effective today. Even in the absence of, really robust regulation around carbon emissions here in the United States I was, they might be upset for me is phrasing it as being surprised. But I was very pleasantly surprised about, not only the goals and the effort that both Anheuser Busch and Xylem put into tracking the carbon footprint of their processes and equipment.

But you know, how much that becomes part of their internal report card. They really both have been talking the talk and, I like Carol’s opinion on this, but I think the only reason we didn’t really bring it up is that, we’ve found in the past that we really need to emphasize, the non-carbon aspects.

So we kind of have to just scoot right by it.

Carol Maxwell: Well,

Antoine Walter: at all.

Carol Maxwell: Yeah. I mean, we have to prove that we can, it’s that’s the benefit from what we do. It’s not what we’re trying to do is to decarbonize, but it does have that massive ability to do that.

Brent Solina: And, I will say, there’s definitely been a growing focus. There’s similarly, I know there’s a growing body of knowledge around nitrous oxide emissions that folks are becoming more concerned with. And of course, unlike methane you can’t do much useful with that.

And at least not until five o’clock when work ends. And that has huge carbon footprint in the atmosphere or greenhouse gas equivalent in the atmosphere.

Antoine Walter: So I’m reassured I didn’t totally misunderstand it. And in carbon, either result.

Brent Solina: Yes. Yes.

Antoine Walter: driver, but it’s, I mean, you’re looking at many things. And then as a result of all of that, you decarbonize,

Brent Solina: And I, to talk about it specifically our microorganisms love volatile fatty acids. So we curtail that methane production by kind of essentially shunting away from that methane production even within the bulk fluid itself,

Antoine Walter: I have a last question in this deep dive, and it’s a question about your business model. all, let me be very blunt here. How do you intend to make money?

Brent Solina: selling Veeva

Carol Maxwell: Yeah,

Brent Solina: Again, just like our manufacturing, we had a strong focus on, what ROI matters to our customers, our potential customers, and are we on our way to hit cost metrics to match. And that was a very long road because it’s a very complicated pricing structure.

Everybody has different pain points. As I indicated before where, we had the wind against us is that we are right here next to the great lakes. We’ve got some of the cheapest, power and cheapest water that you can find on planet earth. That makes it hard to get traction sometimes.

But if you ask how we’re looking to make money, it is sales of Viva units.

Antoine Walter: so your intended Business Model for these CapEx sales of your product, I’m just asking because from what we were discussing, it could as well be, I don’t know internet of wastewater as a service, and I appreciate your trademark on that, Carol. So it’s written markets on me or leasing those, plenty of possible business models.

It’s interesting.

Carol Maxwell: have not really done taken a look at. At leasing from a financial standpoint, particularly, where we are still in the process of trying to figure out what would be the cost, what would we sell Viva modules at? And that’s something that we’re still in this process of trying to kind of parse that out.

We’ve been trying to talk to people about it so far. I’d say that we have mixed feelings about this because a lot of people don’t really want to open up the kimono and tell you a lot of things about it. So I think that when we’re done with some of our current piloting and we have a closer very close view of performance of Viva That is really validated both now in municipal and in industrial, that gives us an opportunity to try to go back to engineering firms and other companies to try and get a better handle on it.

In terms of what is this really worth beyond? Because it isn’t just about the energy efficiency specifically, even though that is kind of a high point.

Brent Solina: I’ll also say on when it comes to model, if you look at everything we just discussed about we’re, we’ve worked very hard to have a proprietary large-scale manufacturing platform. When we’re ready to light that rocket and move forward. We don’t particularly want to be constrained by all of the additional engineering services that come with direct sales supporting the installation when there are partners out there that have those connections have that access.

And the only thing they don’t have is Viva. So that doesn’t lend itself quite as well to either a lease or a benefit sharing. But what it does do is leverage, again, our large scale manufacturing capacity

Antoine Walter: Which is me to match my closing question here. How does success look like for you on the 10 year horizon

Brent Solina: Say a Vi va in, anywhere where there’s biological waste, that needs to be degraded. Which I realize is kind of a top level answer, but again, in leveraging our mass manufacturer ability that is what that rollout is going to look like. This is something that’s applicable to low strength waste to high strength waste.

There’s potential applications in in situ environmental remediation. If you have, a problem water stream, instead of, diverting any of that fluid, you could put Viva modules directly in, like, let’s say a retention pond that you know is having frequent, algae blooms and causing issues like down in Florida, for instance and, as we grow, that’s something that we don’t always need to be directly involved in because people will be more familiar with the technology, be more familiar with the platform.

And, we will, of course always support , those use cases there’s always back and forth between the engineering firms and the equipment manufacturers. But we are really looking forward to being able to leverage all the people out there that are already trying to solve this problem and just giving them a very sharp spear to go hunting with.

Carol Maxwell: I think. Opportunity for us, working now with Xylem and with Anheuser-Busch, they’re two totally different companies, but both of them are very anxious to be decarbonizing their operations and they’re also interested in innovation and they understand that. And they’ve expressed this a number of times that the reason that they’re doing these incubators and accelerators, isn’t just to kind of learn more, but that they want to expand what they can do from a decarbonisation perspective.

And also from their own operations, they can make them better. And so I think that in the end, the decarbonization is really important, but these companies are looking for better solutions. And what they had, they want decarbonisation, but it’s not just about that. It is also about trying to get a better system.

And that’s something that we can provide. It has novel features that you really can’t get anywhere else. And it gives them a lot more kind of strength in terms of evaluating how they’re doing with their wastewater.

Antoine Walter: Brent, Carol, it has been a fascinating dive into microbial fuel cells. And you’re take at this with Viva and I think I got some nuggets and I think I understand a bit better all of that scene. So thanks a lot for that. I propose you to, to round it off by switching to the rapid fire questions,

Brent Solina: Okay.

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Rapid fire questions:

Antoine Walter: I’ll try to direct them at at each of you. One by one. So, I’ll start with you, Carol. And what is the most exciting project you’ve been working on?

Carol Maxwell: I would say that the most exciting project that we’ve been, that we’ve worked on is actually the Xylem pilot right now. We’ve gotten w we’re a very small company. And so we have access to quite a few engineers in different capacities that have really upped our game quite a bit in terms of really understanding a lot more about the bigger picture of water.

Antoine Walter: Brent’s can you name one thing that you’ve learned the hard way?

Brent Solina: All of it. No, I would say one of the most difficult things in doing the scale-up is, again, my background has been biochemistry. I, having to learn how to code a PLC control systems, design pump systems especially Pittsfield where it was reaching negative 20 degrees Fahrenheit when we were installing that was absolutely trial by fire.

Absolutely brutal. And I’d say that’s the thing that I was an unintended lesson. I’ll put it that way.

Antoine Walter: I’ve read that story on your website. Preparing the tip is at first, I didn’t understand it because it wasn’t written foreign aid. It was written degree. And to me that was pretty hot. So then I found out it was Fahrenheit and that was pretty cold, but stupid Europe in me.

Sorry.

Brent Solina: yeah, negative 20. I can tell you, it took, you had, I would set my watch. It was a seven minute timer. If I had to stop flow to do any modifications in the line, I had seven minutes before that line would freeze solid until the spring. That was brutal.

Antoine Walter: I imagine the challenge you, Carol, is there something you are doing today in your job that you will not be doing in 10 years?

Carol Maxwell: I won’t be making pitch decks.

Antoine Walter: You wouldn’t be surprised at how often that answer comes.

Carol Maxwell: That’s right. Cause it’s really the least fun part of my day and I’m not very good at it. I think so overall, so

Brent Solina: Oh, she’s too modest.

Carol Maxwell: I don’t know about that.

Antoine Walter: Brent, what is the trend to watch out for?

Brent Solina: Well, I have been paying a lot attention to this microbial fuel cell space. And I think that’s really going places. All jokes aside. I mean, again, I am biased, but when we’re talking about something that has the potential to do energy positive desalination in the future, when we’re talking about something that has impacts on home septic, environmental remediation small plants, large plants and as well as the data, if I didn’t feel that way and couldn’t answer the question saying microbial fuel cells, I would not be here.

Carol Maxwell: Yeah, that is a really good point. We didn’t address it before, but microbial fuel cells don’t have to be only for industrial settings. And there are even in the United States, a lot of places that they don’t have sewer systems necessarily, or very good ones. And there are a lot of people that don’t have good septic either.

And so we have all, other ways to go in terms of basically using the same technology and even somewhat the same format but just size it down.

Antoine Walter: If you open that sidetrack, then let me follow it up. Because when you think of it’s the way you just explained it. And there’s one hot trends, which usually comes as an answer to that question , with a lot of my guests, which is the trend for distributed or de-centralized treatments. And what you need for that is a system which is sturdy, which apparently your system is.

But the number one feature is that it needs to be connected and automated because if your system is distributed, you cannot afford to have an engineer or a technician sitting next to it’s 24 7, that would be stupid. And that would defeat the full scalability of the experiments. And here you have something which is beyond automated and connected because you have your bacteria which are dragging things in your calender, which I’m still amazed.

And I’m wondering how much of that. Difficult and, blue ocean vertical, are you exploring now of this decentralized distributed treatments, which everybody could have basically in their backyard?

Brent Solina: I think it’s something that is firmly on our radar. And again, especially with somebody like Xylem that has, reason to be focusing on those markets it’s definitely a conversation to be had. But I think Carol would agree, right now we’re focusing on, these pilots that are right in front of us.

Carol Maxwell: Couple of years from now, that would be fun to really try and get into it because those problems are still going to be there.

Brent Solina: right. And we want, this Viva module perfected bomb-proof with just mountains of data behind it. And then exploring all of those other applications we talked about is going to be a much easier transition.

Antoine Walter: Which is probably the reason why you’re in business. And I’m asking questions because focus is the number one thing before going in all the tangents and inside track that they can imagine. Yeah. Carol. If you were a word principal leader, what would be your first action to influence the fate of the words?

What are challenges?

Carol Maxwell: I guess I would look at that probably from the human standpoint. And I think that everybody should be able to have access to basic safe sanitation.

Antoine Walter: And for both of you two to the strong enough, would you have someone to recommend me that should definitely invite on that microphone anytime.

Brent Solina: it’s an individual by the name of Sivan Zamir at Xylem. She just started heading up the incubator. She’s phenomenal. I would also recommend potentially some of the people at the AB InBev incubator there’s a large water focus there but again, they can really give you insights into what those companies are doing to walk the walk around decarbonization.

I’m continually astonished at what they do over and above water. And they just so many elements of their business they’re focusing on. I think that would be a really good program.

Antoine Walter: Well, thanks for the recommendation. And if people want to follow up with you after having listened to all of that, where should I redirect them the best?

Carol Maxwell: So if they want to just learn a little bit more about what we do, our website is the best. If they want to have a conversation or learn more about us, I would say that LinkedIn is probably the best way to reach us.

Antoine Walter: So as always, you’ll find the links to all of that in the show notes. Well, Brent, Carol, it’s been a huge pleasure to discuss with you and to explore all of that I’m going to be looking at what the future holds for you and and yeah, whenever you have a next big milestone to share be really happy to explore it with you.

Thanks a lot.

Carol Maxwell: Okay.

Brent Solina: you for having us on. Yeah, I I guess the last thought I’d like to leave you with is if there’s one thing you take away, it’s again, that notion that life is electric here. What Viva allows us to do is tap into, the electricity of life that’s flowing around all the time right now.

So when you look at wastewater, in our don’t look at just the oxygen, don’t look at just the bugs. You should be seeing lightning bolts flying all around that tank with Viva being the extension cord to plug into that.

Antoine Walter: I’ll do something which I never do is I’ll tell everyone what’s by intended title could be, right now after this discussion and the have to out of what you said, which was this life is electric and the other was are your microorganism on Twitter? And I think if I combine both of them, maybe you have a fund and catch a thing.

Brent Solina: Excellent.

Antoine Walter: And if it’s tied to it is fully different when you click on that is that’s. I changed my mind is remember I’m French. So that happens.

Brent Solina: Excellent. Thank you so much. This is a lot of fun. Thank you

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The post What if your Microbial Fuel Cells could Reach Out on Twitter? appeared first on (don't) Waste Water.

Why and How? Let’s review!

with Nicola Lei Ravello – Author and Founder of White Stag Investing

White Stag Investing is a research platform for responsible investments, focusing on sustainability as a source of value and stability in the long term.

What we covered:

How the interaction between Water and the World as we know it relies on a fragile equilibrium

How our whole economy builds upon a steady supply of water and how it could turn into an economic risk if it was to get disrupted

How with Climate Change unfortunately here to stay, events of too little or too much water will multiply and what it involves

How the acknowledgment of the economic risk of water is still embryonic and how stakeholders and decision makers may click too late

How mitigating the economic risk of water is fully doable, yet can be quite expensive

Why market forces can play their role to better value water and how

How we rely on probabilities and data to engineer our infrastructure as well as our financial portfolios and how the new unknowns create a new wave of risks

How the world’s economic risk is also a business opportunity for the Water Industry – and what we shall do to leverage it

5⃣ How there are five shades of investing in sustainability and what they are

How ESG approaches change the way many finance players do their job

How humanity has built its wealth around water in all its forms and how that may soon backfire

How new technologies can have an effect at a planetary scale and what it involves in our approaches to it

How there’s a relationship between building a ship and crossing the Atlantic as a Viking and modern investment approaches

Industries that are the most exposed to water risks, the available tools to measure it, the finance scene rapidly evolving, water wars and manufacturing peace, water from an indigenous perspective, making balanced investment decisions in an uncertain world, writing, educating… and much more!

… and of course, we concluded with the 𝙧𝙖𝙥𝙞𝙙 𝙛𝙞𝙧𝙚 𝙦𝙪𝙚𝙨𝙩𝙞𝙤𝙣𝙨  

Resources:

Send your warm regards to Nicola on LinkedIn

Visit White Stag Investing’s Website

is on Linkedin

Antoine Walter on LinkedIn

Teaser: Water is an Economic Risk

Infographic: Water is an Economic Risk

Full Transcript:

These are computer-generated, so expect some typos

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Antoine Walter: Hi, Nicola. Welcome back to the show.

Nicola Lei Ravello: Thank you very much. Thank you for the invitation.

Antoine Walter: So you’re one of this twice guest on that podcast. There’s only one ahead of you it’s Ravid Levy, who was there three times. So now you have some pressure.

Nicola Lei Ravello: Yeah, sure. I can come back next year too. You

Antoine Walter: I recap a bit what we discussed last time, but just before I’d like to open with our good tradition, which is the postcard.

Yeah. And actually we are sending a postcard together from Zurich because we sit in one of these fancy places, but what can you tell me about Zurich, which I would still ignore by now?

Nicola Lei Ravello: it’s very sunny day today. We get lucky and we got super lucky, I would say also over the winter to have a lot of sun.

Antoine Walter: So sunny Zurich. That was our advice as the tourist office.

Nicola Lei Ravello: Yeah. Now, but I would say that Zurich is really a city where it changes a lot by by the season, like in winter, everyone is a bit inside having maybe a beer or a glass of wine inside, but as soon as the sun comes around, like, It’s like the city flourish, like a flower, like there’s like terraces everywhere.

You can go in the water. It’s like, there’s a lot life in it. Yeah.

Antoine Walter: there’s a terrace here. Yeah. I was thinking maybe let’s do it outside, but I think you already have some background now from our place.

So maybe outside, would’ve been a bit,

Nicola Lei Ravello: yeah, we can get the coffee afterwards or be

Antoine Walter: So when we discussed roughly one year ago on that microphone, you showed us how finance could unlock something in the water sector. And I think that’s quote unquote, what you said finance can unlock something. And how that was good news because there’s this element of finance can be maybe something that people are afraid of.

 You expand how different investor profiles would see different appealing aspects in the scattered water industry from the utility bedrock that makes for a safe bed for pension funds up to the dynamic startup scene, that’s attractive for venture capital . And you’ve told us how that made finance a kind of engineering space where investment research and consulting companies like White Stag your company can build sustainable portfolios in all the acceptions of sustainability.

So hopefully profitable, but also with a positive social and environmental impact. And you see how I put profitable first? Yeah. Which is already a question. Shall we put profitable first or the impact first?

Nicola Lei Ravello: I think it really depends what you wanna do, mean, if you’re an investor

You want to make a change and an impact, then you can put the impact first, it really depends a bit of the. The owner of the capital and what he really wants to do, you can be a family offices that is a bit more conservative and just cares about the wealth of your family over time.

And then you put like the financial first, but you can also have, maybe want to have an impact on the side, you know, pension funds. They need to care about the financial, because otherwise they’re not gonna be able to pay the liabilities to the people, but, they still have a pressure from their constituents to have an impact, yeah. I mean, it really depends of the capital owner and what you want to do, I mean, you can be like also a family emphasis or a VC fund that really cares about solving water issues and you go on the impact full on. Yeah.

Antoine Walter: actually I warned you last time. I have to warn you again this time. Yeah. Of the fact that I’m really a finance layman and I’m happy being a finance layman. So I’m trying to simplify things

Nicola Lei Ravello: Yeah

Antoine Walter: I get them. And in that preparation, I was looking bit how big is, impact, how big is NG ESG.

And And so far, and from what I’ve found, ESG investments is about 15% of the investments worldwide, which would make about 35 trillion. If I’m right and inside this ESG one percent is impact and that would make about 350 billion.

I had the discussion with John Robinson on that microphone.

And when I said that he told me no, that is over simplification. That’s not how he would define the general pockets in the market. So would you agree with this?

Nicola Lei Ravello: I mean, I don’t look at the latest numbers. I think it’s roughly that, maybe a bit, it was even a bit more actually maybe 1.5 billion for impact and. I’d say 40% for ESG, but I think it’s right in a sense that I mean, ESG is a lot of different things, when you design your investment strategy and how do you want to integrate sustainability? There’s a thousand ways to do it, so you can either start with the basic screening methodologies. You say, okay, we don’t invest at all in in guns, in oil and gas, in the mining operation.

That’s one way to do it. Or you say, okay, we have an engagement methodology. So we engage with the oil and gas industry trying to reduce their externalities, their methane pollutions the problem, all the problem linked to fracking and everything. So you can also have an impact by engaging with your companies and saying, you should not do that to this?

Or you can have like a, I would say, a targeted approach where you say, okay, we. we really believe that climate change or the water crisis is a huge problem. And the solution for these problems are gonna be needed and are gonna be valuable in their own. Right. And you can just target the best solutions and create a portfolio out of this, so yeah, I mean, I would say the ESG wave is it’s quite massive. And I think it will take

Antoine Walter: talking of that E ESG wave because when we discussed one year ago, it was about, is there sufficient finance due to feed the water industry? And we’re saying you were explaining that finance can unlock something, but we are also saying maybe finance is not yet to that point.

And you were saying, you have to evangelize and to keep explaining everyone. And now we have the

Nicola Lei Ravello: did I say evangelize?

Antoine Walter: I think that was my oversimplification.

Nicola Lei Ravello: maybe . Yeah,

Antoine Walter: but when we see now the ESG wave, everybody keeps referring to nowadays. Do you think that went too far and is it a bubble?

Nicola Lei Ravello: Well I think I would say first that there’s definitely a lot of interest from retail investors. So like, you, me and like personal, I mean, I would say not ultra wealthy people to that really care about like sustainable challenges, like solving climate change, solving water.

So there’s definitely an interest for this. And also from also some family offices or ultra high networks, or very rich families, they want to have an impact, and then it’s like, how do you translate that in tangible projects, genuine in financial products that does have an impact, and I think that’s the whole that’s whole deal now. So I would say the ESG wave has a change in investment preferences. So not only care about financial return, but also about the impact. I think that’s pretty good. And that’s gonna change the industry. Cause now you, you design your investment strategy, not only about risk and return, but on a third dimension, and then I think it’s gonna be a process of be going too far going.

Coming in, but at the end of the day, I think what matters is whether your investment strategy is legit, like if you really have an investment process that cares about impact that you do either an engagement methodology, or you do a specific targeting of the best solution. there’s also a dark side where a lot of asset manager use that as a tool to raise more assets, and or just surfing this greenwashing wave,

Antoine Walter: When you say investment methodology and. ESG really, from my perspective sounds sometimes a bit blurry. You can have your own definition of E of S of G and then define it to be really green or really sustainable, or really having an impact when in fact objectively, maybe it’s not really the case.

Nicola Lei Ravello: hundred percent.

So

Antoine Walter: Is there a structured way to build an ESG portfolio?

Nicola Lei Ravello: Yeah. Yeah. I mean, I think that’s the whole deal, this whole exercise, it’s like it’s like rebuilding a car, with a new changing Euro gas engine to to electric engine.

So somehow you have to. Remove the engine, you have to change all the things and put a new engine and make sure that everything still works. So you had an investment process where, before, I don’t know you were caring about volatility. We don’t invest in stock that are too risky or too volatile.

We want to target return between, I don’t know, fear five and 15 and that’s it. Now you have like a third dimension, like now we also want to impact or at least sustainable I would say sustainable consideration, so kind change the parameters in your modelization in your in your analysis.

So

Antoine Walter: yet if I recall my discussion with Claudia Winkler and Alice Schmidt on that microphone, in their sustainability puzzle book, they explain how we have this Mickey mouse thinking where you have profit is the head of Mikay.

And then you have environment and Ty, which are the ears of Mikay. So they exist. They are parts of the assessments, but they are by far not central, like profit would be.

Nicola Lei Ravello: Yeah. I mean, that’s, that can be that can be one way to, to approach it, well, I mean,

Antoine Walter: them, that was the wrong approach but the approach that too many people keep following.

Nicola Lei Ravello: Yeah. I think the financial is still the main consideration for a lot of investors, I wrote an article, I think two years ago about why people care about sustainability, so I think the first level is like, oh, you see that as a well, people care about sustainability. I can just put some words in my in my fact sheet that are sustainable and I can raise assets from sustainable investors, so that’s kind of like a using sustainability as a marketing tool. Even if you don’t give. Give a dime about it and you say, oh, that’s I can increase my 10%. That’s one way. I mean, that’s like the greenwashing way, that comes at your own risk, because if you say that you do sustainability, then you don’t, and then maybe those clients they’re gonna come back and then it’s like, reputation issue,

Antoine Walter: so kind of greenwashing at that

Nicola Lei Ravello: stage. Yeah. I mean, that’s pure greenwashing, and some people can use it as a way to make money, but if you do that, you’re just gonna be a risk. It’s like being dishonest,

Antoine Walter: like

Nicola Lei Ravello: This is just simply not true.

Antoine Walter: mm-hmm

Nicola Lei Ravello: You have other investors that see sustainability as a compliance, so they have the traditional financial investments, and now like they have this pressure from society or from the investors to care about sustainability.

So they kinda see, oh, we have to deal with sustainability. So how can we do that? So those kind of investors, usually they’re gonna rely on frameworks, on ratings in a way to justify their investment, so they do like simple screening. Okay. So

we’re just gonna tick this box and that’s okay. So sustainability is deal is dealt with, and that’s very, really a compliance Then you have more sophisticated investors that see that as a economic risk. Sustainable issues are changing the world entering the economy.

And if you don’t take care of them, you might lose your investments, so you have to integrate those consideration, your risk management process, then two other layers is like, they see that as an opportunity. So that’s the other side of the risk the risk discussion and they see new opportunities investing in water tech, climate tech, or all the kind of solutions they’re gonna solve

Global issues.

And I would say the last is people that really care about the impact they invest for impact,

Antoine Walter: the, this third level of risk I think is the heart of your latest articles.

So I think it’s also what I’d like to

Nicola Lei Ravello: discuss. Yeah. A hundred percent. Yeah.

Antoine Walter: J just before we go into that,

in this ESG wave. Yeah. I had Reinhard Hübner on that microphone explaining that. To quote him not to,

Nicola Lei Ravello: yeah, sure.

Antoine Walter: his word there’s too much stupid money chasing too few good targets.

So that would mean ESG is full of investors, looking for companies to invest in. And they’re not that much good companies, something which Christopher Gasson said in different words, also on that microphone when he said that we should not complain about the ESG wave at all, but we should make sure that there are projects for that money to be efficient.

Nicola Lei Ravello: percent. Yeah. Hundred percent.

 I definitely think in the public equities water funds, like the lack of Pictet or RobecoSAM, when Pictet is managing almost 10 billion now in investing in water stocks RobeccoSAM 4 million and there’s have been a lot of interest and a lot of money going there, I think there’s definitely a lot of too much capital for the number of water companies then there exist.

And that’s why I think a lot of them at a higher lot of, I would say high valuation but I think this is also due to the fact that you had a lot of liquidity on markets over the last 10 years from the quantitative hazing from the central banks. So the central banks were pulling a lot of money, they were like expanding the monetary mass in the market to support the economy and support job growth and support the whole economy going, and that’s this kind of If you expand the pool of money you are, you run the economic risk of inflation, and usually inflation is in, in the economy.

But I think in the last 10 years there were in asset

prices, I mean, if you look at the market, since the financial crisis, it was almost like this, like almost like a straight line up, so I think the high valuation we see at least in the public equity water market is not because of the water not only, but also because of market factor, that valuation were in generally high, because there was a lot of liquidity in the market, so yeah, it’s gonna be interesting to see how it’s gonna develop now that , the economic inflation is high that

Probably banks gonna start raising rates. So they’re gonna like pull back the money. So when there’s less money in the economy, the valuation is gonna go down because people are just have less.

So I think it’s gonna be interesting to see how things gonna normalize. And I think that’s also gonna impact the private equity and the venture capital, because there’s also gonna be less money. So the valuation will probably go down a bit. But that being said, I still think that the.

 Fundamental reason to invest in water is still here. we need those solutions. climate change is gonna aggravate the whole water crisis. We’re gonna need solution to deal with water scarcity around the globe with floods. And so that’s not going away,

Antoine Walter: actually those are some of the risks which you list in your article.

Yeah. And your article is if you read it, I mean, out of the blue, yeah. You just start reading your article and like, oh my God. Water is really troublesome because there is the floods. There is the risk. If you don’t have water, then your industry’s done because it’s on the critical path and you list all those risks and. What is your intention with that? Is it to scare people and say, look there, there’s a big problem.

Nicola Lei Ravello: Yeah. I don’t know if I’m in to be a scarecrow or but I think something I was not seeing in the sustainable space or in investment space. I think something people invested definitely don’t realize is how whole economy is working because we have a steady supply with water.

I mean, I think that’s the foundation of society, since the last ice age, humanity can develop itself around the water lines, around rivers, around the lakes, around fresh water sources, slowly but surely we we build agriculture practice that was using this water.

Then the water was used as a way for commerce, and then you, and in the last 200 years, it was used as a industrial input, I mean, you need water to factor medicines, drugs, you need water to create cement for clothes for for pretty much anything actually. And if you used to unlimited and free supply water and you don’t even realize it’s part of your business model, because for forever you lie, I’m just gonna take the water from the lake.

I mean, now. There is a drought and there’s no water available, then you start realizing, oh, okay. It’s like, yeah, we need to do something about that. You know?

Antoine Walter: So you’re saying that water has a huge value, which we don’t realize because we have it.

Nicola Lei Ravello: a hundred percent. Yeah.

Antoine Walter: it’s kind of thing, which if it vanishes and disappears, then all of a sudden we’re like, oh yeah, that was really at the core of everything.

Nicola Lei Ravello: I mean, I think most of the industrial business models in modern time, they rely on a free and steady supply of water, and this is going away. So if they don’t do something about it, then you might find yourself in a tough position. And that’s kind of what the message I wanted to get across, that pretty much all industries and all investments, I mean the whole business and the whole valuation relies on this process to have a water, to

To produce and to function.

And if this water goes away then your investment or your business is at risk,

Antoine Walter: And to whom do you want that message to come across?

Nicola Lei Ravello: I would say the entire financial community and the economic community. I mean, pretty much anyone, actually. I think it’s really also part

Antoine Walter: your primary target if there’s really

Nicola Lei Ravello: primary target is really the asset managers, investors, and and the financial community. And that’s kinda, I would say my way of having impact, if I can do my part in showing in valuing water in financial market and in the economy, then the whole idea is that once investors and asset managers and economic decision makers know the real value of water, they’re gonna change the decision about water and they’re gonna start preserving it, so it’s really using market forces to to value water.

And once it valued a LA, we cannot follow it. We cannot disregard it. Then somehow the whole economic machine Starts to protect it.

Antoine Walter: So an asset manager reads your article and reads one of the scary stories inside, like, like the semiconductors in Taiwan, all of a sudden, no water, which means you stop producing because yeah. There’s no other way around.

There’s no water. Yeah. And so how does he react to that? You say it’ll influence their ways to look at water, but in concrete step, will they, I mean, they are still asset managers. They are not people which are Reiding with the waters, which read their money, which is gonna, so it’s an indirect impact

Nicola Lei Ravello: yeah. It’s it is an indirect. I mean, my feelings at the moment is that it’s the whole sustainability story. I think people, I think now there’s a realization in the financial system, in the financial community that sustainability climate change and the water crisis and biodiversity is.

Important and defines the survivability of the economy, so I think there’s this realization that without that we don’t have an economy, we don’t have money. I mean, the survivability of an asset manager is dependent on nature, keep on being healthy and working, but then it’s a bit like a decision, like, should we change everything we’ve been doing to make it more suitable now, should we wait a bit what the others are doing?

And there’s a bit like a process on, and I think there’s also like, some asset manager can stay invested in oil, because I like to use a baseball analogy for this. Like, this is the LA the last innings, the last L 12 11 or 12, but it still can be a lot of activity that, and so I think some manager asset manager can start investing in new system or solution and be at the same.

Still being invest in oil gas, because they can still make the last pocket of money that is exploitable in these things. So, an asset manager can approach the transition, like the whole coming from a business as usual investment practice to sustainable investment practice in a way that is not necessarily the, what would be ideal from a climate perspective,

Antoine Walter: so if you help them click and realize a bit earlier, you’re shifting the timeline because that’s something they would have done.

Nicola Lei Ravello: Yeah. I mean, that’s really what I’m trying to do. And I think that’s really what I see. It’s really a switch, because I’m always trying to put water as as a culprit.

I dunno if it is the right word in English, as a how the entire investment thesis relies on this, and once, once I make this case, People it’s like less, really like a switch, and then they understand perfectly and they have an idea to where to start what to do, and I think that’s kind of all the articles I’ve been writing for the last year. It’s so about this, it’s like, I mean, it’s like Tesla that has been investing 5 billion in its Brandenburg factory to, which is seen by by most analysts as the its way to dominate the European market to at least grow its presence in the European market.

But the reality is that the groundwater reserves in Brandenburg are going down, so Tesla like at the license from the environmental office of the Brandenburg state, but then office got sued by the local farmers and communities, and somehow now it’s, legal legal gridlock, and the lie is stuck, so it’s this it’s entire success of its new investments depends on whether you’re gonna get water or not, I think,

Antoine Walter: which is a very, let’s say funny, it’s not the right term, but a funny story, because actually you can solve that in the case of Tesla with creating the biggest atmospheric water generator ever.

Which is a story I like to cover on that podcast, which has lots of ins and outs, but it sounds like, you’re just raising the financial bar of the value of water. And at a certain point, it crosses the line of how much it costs to create water from air. And then you do water from air and it can sound like there’s a solution to everything.

And usually that’s the way we treat desination. I mean, you don’t have water, just desalinate water, and there’s oceans everywhere. So you find water. And on the other hand, it could be just shifting the problem because. What happens to the climate. If all of a sudden you start to really use all the humidity to, to produce batteries and nobody knows, and maybe nothing, but still, nobody knows.

So

Nicola Lei Ravello: That’s a good question. I mean, when I looked at the technology, that was one of my main concern, you’re still altering the water cycle, in a way that is not known, I mean, you can do ever mental modeling and reports to have an idea of what’s gonna impact, but who knows, my, the same way it’s gonna also, I mean, water vapor is also a greenhouse gas, so

Antoine Walter: the strongest of all,

Nicola Lei Ravello: Yeah. The strongest fall. Exactly. So it can also be a way to reduce, to work as a climate mitigator,

Antoine Walter: It’s the greenest way. Just we don’t know.

Nicola Lei Ravello: Yeah. And that’s, I mean, that’s, I think we are really entering in an era where where’s a lot of unknown, like many technology.

I think I was also skeptical about all this carbon removal from there, like what happens when you start messing with the carbon cycles? The water, I mean, I’m not a climate scientist, I understood that so far that the carbon is like

You unified in the, around the planet.

So that’s somewhat okay. And but I think a lot of new technologies now is gonna be at a planetary scale. That’s changed the planetary systems, and then sooner or later, we’re gonna have to understand really how that works and make sure that we don’t screw it up.

Antoine Walter: You say there are a lot of unknowns and I think you’re fully right with that for.

A financial professional. That sounds like, like the worst, which can happen because if you have to make bets on the future and safe investments and everything, I mean, unknown and risk is not really what you have at the hurt. And if you look at the pyramid we had last time we were discussing with the bedrock, the people which are looking for safe bets.

And then on the top of that pyramid, the venture capitalists, which can absolutely deal with economic risk. It sounds like those guys are now in the middle of their environment everywhere, but the ones which are looking for very safe investment, what is safe in the new real

Nicola Lei Ravello: question. I mean, there’s usually an analogy that’s when you build an investment portfolio or your bank account, you see that as a vault, that you I’m just gonna create something safe under underground and with thousand walls and that’s safe, but if you build that and there’s a flooding and then maybe all the, all your bank notes in the vote

Antoine Walter: are.

Nicola Lei Ravello: Are getting water, then the whole reserve is gone,

Antoine Walter: so

Nicola Lei Ravello: I think a good analogy to see investments is also more about like, you like building a ship, like you’re building an investment process, It’s like building a ship and trying to cross the Atlantic like Vikings before or Europeans in the 16 and see where that goes.

But I think dealing with UNS, uncertainty, and and risk is probably the job of asset managers, ,

Antoine Walter: but when you look at

I don’t know how to call them. Let’s say the finance community. Yeah. Do you see many people which have the same approach than you and which try to go to the bottom of things and to understand them and hence yeah. Have informed view and know where to put their eggs and which baskets are the safest or do they rely on people like you to indicate them the trends and where are those baskets if they’re maybe hidden

Nicola Lei Ravello: Yeah. I mean, that’s really what, how I see my job, is being informing the, how the.

Antoine Walter: the

Nicola Lei Ravello: Investment consideration are changing with climate change and the water scarcity issues and and biodiversity, so then it’s re up to every investors, some, they don’t really wanna know they don’t care and they’re just gonna invest their money.

Others really see that as a risk and opportunity. So they’re gonna change their decision. Okay. We’re not gonna invest in this anymore, but we’re gonna invest in that. No, I definitely see a lot of managers that sees sustainability as an opportunity. Now, I think the likes of BlackRock the main ones they understand, I think that we need to change society now.

I mean, the way it’s built is not aligned with nature anymore, so that’s not gonna work. And in this change, it’s like rebuilding society, you know? I mean, it is huge opportunity for people that can see that want to see them, it’s like rebuilding entire infrastructure, the entire cities, the entire way the economy is built.

And if you finance the right solution, then it’s like,

Antoine Walter: But that, that starts with awareness. And there’s one quote for, from you, which you say that, that water represents less than one percent of GDP, yet it influences over 99% of

Nicola Lei Ravello: GDP. Yeah. A hundred percent.

Antoine Walter: And once you’ve been looking at the water industry at the water sector or industry in general and the role of water into that’s absolutely clear.

And that sounds even obvious. Yeah. But you know what? It’s like the ha effect.

Nicola Lei Ravello: A hundred percent.

Antoine Walter: before you break the ha

Nicola Lei Ravello: yeah.

Antoine Walter: You just don’t realize

Nicola Lei Ravello: that. No.

Antoine Walter: And what is the level of awareness you see out there when you say that are people saying, oh God, we all know that, or

Nicola Lei Ravello: On water, I see. Little and that’s my job.

Actually. I see that it’s like really I would say an awareness and education process by an older post and articles I write on a daily basis, and I feel it’s clicking in, so more and more, there’s more and more engagement with my post and conversation that they understand, like, and that’s what I’m trying to do always is like treat going for this switch.

It’s like, look, I mean, we have an economy because we have a steady supply of water, and if that goes away, then it’s like energy actually is the same. I mean, if you’re trying to run a business without electricity, I mean, it’s,

Antoine Walter: there were electrical blackouts, so people realized that. Yeah. it’s a bit The doom of the water sector is that most of countries and most of places, except for the one which lived the zero or the one, which really liked Taiwan, one

Nicola Lei Ravello: had to

Antoine Walter: to shut down their semiconductor industry.

They just never had the problem. Yeah. And probably when you have the problem, it’s already too late, so you have to react before.

Nicola Lei Ravello: Yeah. And that makes the risks more pernicious, I mean, as you said in electricity, when there was a blackout, oh, you understand that we need a reliable social energy, but in water it’s more like, I mean, that’s a good question now. Like how do you invest going forward based on water and climate risks that you don’t really know?

I mean, you can read the IPCC report. They say they have several level of confidence, like, floods are gonna increase by this droughts are gonna be increased by that, but you don’t re, you don’t really have, I mean, you an engineer, like how do you plan this kinda water resilience going forward?

There’s a lot of, you can say, oh, maybe we wait another three, four or five years, see how it happens. So should we go with the big buffer, should we aim for like four degrees world and build like, Strong resilience thing or is something in between. And I think that’s not an easy decision.

No, absolutely.

Antoine Walter: I mean, in the engineering world, there’s a bit this element of, historically our infrastructure was built on probability. Like there’s one out of 1000 changes or risks that, that this happens. And hence we build our dams, our I mean the full hydraulic infrastructure on that.

And now we have a shift and the shift means that probably the events are gonna be bigger, but we don’t have data. So it’s like, let’s take a guesstimate.

Nicola Lei Ravello: Yeah. and

Antoine Walter: say we mention everything because we still have to have this one out of 1000 probability because people won’t accept to be flooded every second year, but we just don’t have data.

We know something is shifting, but what we don’t have that historical track record anymore when we can rebuild upon it. And that is challenging because that is,

Nicola Lei Ravello: yeah. I mean, I think you understand, well, it’s like you build your infrastructure based on a set of probabilities. So you create a buffer for the uncertainty. Now there S uncertainty, none, these priorities are changing, but you don’t know how they’re changing, and how much, so the buffer, you need to adjust the buffer, and it’s tough.

I think it’s gonna be a decision going forward. Like how much you invest for this buffer how much the buffer should be now for, to account for climate change. We didn’t have, like this blackout that put the awareness on the map, but I think now it’s a couple of examples that happen with Tesla with other actually

Antoine Walter: actually the interesting thing is that probably if you look at the economic risk side of things yeah. The blackout wouldn’t be the biggest risk though.

That’s my very subjective feeling. Yeah. Because if you don’t have water, yes. Everything is stopped. Yeah. But as soon as you can find a new source of water and we are very imaginative. Yeah. You’ll find you, you correct the thing, but the other extreme, which we’ve seen in Europe not that far ago and in the us, not that Fargo as well is when.

All of a sudden, far too much water. I mean, floods,

Nicola Lei Ravello: hundred percent.

Antoine Walter: all these cl events, which we will, we all feel we will see them more, but react to those is much more difficult because you cannot just press a button and have less and have a technology which just vaporizes that and send it button to the atmosphere.

I Reverse atmo rate, quarter generation like cloud generation.

Nicola Lei Ravello: no, you need to build new resilient infrastructure. Like either pumps to storm. I mean, these are a whole entire storm water infrastructure that needs, that has to be built.

Antoine Walter: in terms of capital that’s a fully different scale. Yeah. I mean, there you are.

I mean, when you’re building something to. Desalinate a bit more water or gets atmospheric for generation. It has a fixed cost, which you can calculate and estimate, and it’s gonna be in use. And on the other hand, flood prevention is something which is very captive, intensive, and might be absolutely not used for 10 or 20 years.

Nicola Lei Ravello: Yeah, exactly. But if you didn’t do it and in 25 years, there’s a massive flood on you. on the water. Some

Antoine Walter: On the water. So, but, but the, this assessing the financial, I mean there, the risk and financial link is absolutely clear because you have to be, I mean, that’s money, which you’re gonna, you’re just gonna invest in, in some concrete, in some stones.

And once it’s there it’s blocked for centuries. So that is a difficult equation to solve on the

Nicola Lei Ravello: percent. Yeah. But I think the first step is really to get that awareness.

If if I can aim for this and succeed, that’s really, I think, a big step. And that’s also the whole process of valuing water, whether too much or too little. And you’re

Antoine Walter: you have that quote, which is that carbon is not all the story in sustainability and water has a direct and natural impact on businesses. Bottom lines and therefore you invest in strategy and you think that water will become a new standard of ESG integration going forward as institutions grasped with the physical reality of climate change.

Nicola Lei Ravello: Yeah.

Antoine Walter: Which is exactly what we discussed. But I have now a very broad question, sorry for that. But how

Nicola Lei Ravello: I would say how not

Antoine Walter: that was an easy one. look, I

Nicola Lei Ravello: I think I think most of the sustainability discussion and ESG discussion was asked around carbon so far, because I mean, we need to mitigate emissions, otherwise climate change, gonna keep on increasing and getting worse, so that’s crafting carbon is the whole climate mitigation story, but at the same time, we’re already at a point that is. We already suffering, or we already have to deal with the effect of climate change so

Antoine Walter: so far,

Nicola Lei Ravello: and that’s gonna be the adaptation story, and I think the adaptation story is gonna base around water, because most of the effect of climate change has somewhat linked to to either too much or too little water, so droughts storms, sea level rise.

Climate change is disturbing the water cycles. So disturb the water security we have, and then we need to rebuild the infrastructure and the solution to make sure that

Antoine Walter: But how do you build an indicator for that for water inside and ESG framework?

Nicola Lei Ravello: a great, that’s that’s a great question.

And there was one of my my work within a private bank last year is like, how do you go from an investment process that is business as usual. So like traditional to one that cares about climate and water economic risk, so my idea was like, okay, you look where you invested the most. And you, yeah. You have tools in the in the industry to tell you what are the water risk, how important they are to a given industry.

And you can use that to to start modifying your investment process. So my, my idea was like, okay, we look at the most, the industry that are most at risk with water that’s can be oil and gas for the availability of water to frack, again, mining a lot. I mean, mining leads the water to, to mine as well.

So you need you you’re dependent on the water supply, but you can have issues with water pollutions, with putting all the chemicals you use for mining down by the river, but you also vulnerable to to floods, so if there’s a big flood, then your mine is on the water and then it’s also a problem, so my work was ready to redesign the investment process by. Creating an engagement methodology. So let’s say we have all over our investments. And we are gonna start engaging with all the companies and the industries that have the high water risk, and say, okay, you go to them and say, I mean, are you aware of this first?

Are you aware that you’re vulnerable to floods and draws? If not, you try to make them aware. If they don’t want to get aware, then you start an escalation process. You engage with the management. If the management doesn’t want to engage, then you go with the board and if they don’t want, then you just, okay, let’s let is fly, and and then you can start designing a new engagement process. Whereby you ask your companies, your investments to take water, risk assessments, trying to start estimating those risk. And if they’re really vulnerable, you start defining KPIs like, okay, those let’s say you invested in uh, beverage company three or four, indu factories are high risk.

What can you do to mitigate those economic risks? And also you can invest in new water, recycling water treatments, or onsite solutions that gonna reduce the risk of these companies, and Soly. But surely you start this, you start doing this with all your investments. First taking a risk assessment, then defending APIs for improvement, monitoring the improvement until they, they have an acceptable, let’s say risk written profile and then you start screening off.

The bad guy, the bad ones and the ones that don’t want to cooperate. Yeah.

Antoine Walter: When you say risk assessment, it’s like evaluating the cost of inion. What happens with the status quo what would be the consequences of not doing anything? And that gives you first cost and then you have the remediation possibilities and if the remediation possibilities.

Lower in costs than your cost of in action, then it’s a no brainer.

Nicola Lei Ravello: I would say even before you have, I mean, you have tool like the WWF water risk filter where companies can put their assets into the tool and get a report of what kind of water risk they are vulnerable to,

Antoine Walter: okay.

Nicola Lei Ravello: get the first assessment. Okay.

This factory in Mexico is extremely vulnerable to drought. Pollution and flood is okay. And then you get the first economic risk assessment, so you have a target, you have an idea of which water risk at play, and then you can start measuring it. Okay. How much cost the. The water treatment or the water efficiency measure to mitigate this, and what would be the cost of not having water in a given year or second year, then you can stack the whole financial calculation.

Yeah. And

Antoine Walter: so that the tool that you’ve developed yeah. For that private bank yeah. I guess, is something which is then proprietary to them. Yeah. So is it that kind of approach that you have with all those players to help them map out and yeah.

Nicola Lei Ravello: yeah. A hundred

Antoine Walter: Design their tools?

Nicola Lei Ravello: exactly. That’s, I mean, that’s kinda my job, and in a way that’s.

I think that’s what I find fascinating is designing investment process methodologies whereby you integrate sustainability and that change the entire way you, you allocate resources, you have to locate money, so yeah.

Antoine Walter: yeah. that’s one part of your job. There’s another part of your job, which. Probably the most visible part of your job is that I mentioned your articles are usually very detailed, so it’s almost a book chapter. And actually you went that extra step. Yeah. Because you’ve been, since the last time we discussed you, you’ve been writing a book.

Yeah. And if I’m right your crowd funding for a second book, so how is that part of your ecosystem?

Nicola Lei Ravello: Well look I started my company three years ago and start to look at water from a final perspective three years ago.

And my process was really, I would say explorative, when I quit my job three years ago in the finest industry, I really took the time to, to understand what I really wanted to do, and I look for the SDGs for inspirations of how can I contribute to a bigger goal, and for me it was pretty clear at the beginning that the water was linked to all of the SDGs, that that’s I mean, if you don’t have wider rights, nothing is right. So for me, I saw that really as a way to have a great.

Antoine Walter: impact.

Nicola Lei Ravello: And then it was real, like, I would say an explorative process lackings to start.

Okay. What is going on in the wider world? So starting to connect with as many water professional or investment professional, as I could start reading as much as I could on every book, every research piece, every article around water, and then starting to form my own opinion. And I was doing that by writing on LinkedIn pretty much every day for two years now.

Antoine Walter: It’s kind of building public.

Nicola Lei Ravello: Exactly. Yeah. yeah. It’s a bit that. Yeah. and yeah, and surely slowly but surely I kinda build up my own literature, my own database of articles of resources. And recently I’ve packaged this as in all my my best LinkedIn article into a book, which I can sell on my website.

What I’m trying to write about is really how the economy is changing with all climate change and what water scarcity and what’s the new status quo basically, and from all my LinkedIn posts were a bit like of a small bit of the puzzle here and there of what I see, and I’m trying to work on this mosaic build, build the entire, so the entire mosaic, and yeah, my book was a bit of a collection of the pieces of the puzzle.

Not really in a structured way because don’t see the whole thing yet, but then my bigger article is really trying to build on. On different subjects in water. And until I I can cover everything, so

Antoine Walter: is it possible to cover everything?

Nicola Lei Ravello: Well, I’ll try. , I’ll try, but I find it fascinating.

I mean, you have so much going on in water, I mean, I started with the public equity funds where there’s a lot of interest. There’s a lot of

Capital going there. And then I went into the stocks themselves, the companies, what were they offering how that was working, then the VC private equity.

 You have a lot of different topics and you have like water microfinance with water.org, which I think is fascinating. How they manage to create blend and finance structure to attract private capital, to finance water security around the developing world. Then you have also like initiative like Blue Peace.

know if you know about where it’s an initiative of the Swiss government to invest in water infrastructure in developing countries in a way to secure peace. So the idea is that there might be war because of the lack of water. So if you invest in water infrastructure, then the reason for war is going away.

So somehow you can invest in peace by investing in water infrastructure, which I think is a great idea.

Antoine Walter: that? That’s a very interesting question because sometimes I wonder if having a

Nicola Lei Ravello: tr

Antoine Walter: TRO isn’t influencing the way we look at the word and maybe sometimes a bit distorting the word because I’ve seen Michael Stanley Galisdorfer yourself as well, discussing on how the it’s gonna be difficult as a topic, but all, everything happening in Ukraine right now is linked to water.

How Ukraine cutting the water to Crimea, which have been taken over by, by by Russia in 2014 was the root cause. And I have no clue if that’s, it’s just an example. What I’m wondering here is that we have this lens of looking at water. Yeah. With this water is less than one person of GDP influences you the 99 person.

So if you look at water, probably you see the truth. And I’m just wondering isn’t that sometimes a bit too extreme to say water is old than everything and everything can be linked back to water. It’s a tricky question, sorry, but

Nicola Lei Ravello: I don’t know. I don’t know what to tell you actually, but I think that’s the truth, I mean, I think all our species as a human, as a species is here in this planet because of water, I mean, we made mostly about water. Civilizations developed. So well from the last ice age, because we had a lot of fresh water from the melting of the last glacier, so I think our entire story is based on water. And if you look at all the indigenous or all the culture around the world, the origining stories is always about water, so I think water from a physical scientific, or even from a cultural or spiritual way, I mean, we are water, I think that’s not too much of a stretch to, to state that

Antoine Walter: let’s me save you from my tricky

Nicola Lei Ravello: side. Yeah, sure.

Antoine Walter: Let’s come back. I was wondering, we discussed so far how the finance people shall look at water and how that shall influence the way they invest.

They build their portfolios and everything. I’m wondering. Now, if you look at the other side of the story, if you’re a water company and you need some capital to thrive in the future. Yeah. How do you have to shape and adapt yourself to be attractive for investors?

Nicola Lei Ravello: That’s a great question. That’s a great question. Well, I mean, I would first say that with climate change and the ongoing water scarcity water crisis, I mean the water companies are gonna be the one that deal with these issues, so I think the number of problems are gonna go up, and the water companies are gonna be responsible for that. So I think there’s gonna be definitely enough business for them and interest to, stay active. I mean, I think that’s the whole value proposition to invest in water companies, cause they’re gonna stay in business throughout climate change and deal with everything.

So they’re always gonna have, they’re always gonna be active and general profit. So that’s in some sense, this is a sec long term security for investors,

Antoine Walter: but on the other side of that same coin, it’s sometimes if you look at the pitches of any, what company is like, look, we are saving the word.

Hence we are selling activated carbon and people will start get pissed from the activated carbon industry, because I always take that example. I have nothing against activated carbon. It’s just like, to me an example of how it’s hard sometimes to connect thing, look 785 people don’t have access to to clean water.

My technology is fantastic and in between, there’s no direct link. So I’m wondering if those arguments are attractive enough for financial people or if sometimes they want to have a bit more meat on the bone, which will force the water companies to be a bit more practical about saying there’s that problem.

And we solve for that problem. Like really not just with words. I

Nicola Lei Ravello: Eventually you have to prove that you are solving an issue, otherwise you just, err, if you just pretend to do something over and over, then you don’t do it. Then. I mean, the job of financial people is to do this investment decisions to see if we give this money to this person is gonna do what he says it’s gonna do, Otherwise, you’re just trying money out of the window, so I think being honest about what your core mission is and your core values and what you intend to do and do it, that’s the best way to attract long term capital. You know, that’s the, that’s the whole little finance, it’s, trying to make some room in all the, what you hear every day and every day in the news to, to see if it’s true, so yeah, I mean, I think I’m make a good business, be sure about what you do and do it. Well, I think that’s the best. That’s the best you can. Do,

Antoine Walter: you, you mentioned you, you created White Stag three years ago.

Nicola Lei Ravello: Yeah.

Antoine Walter: How did the landscape evolve over this three years?

Nicola Lei Ravello: I would say that sustainability has definitely gone mainstream.

When I started, it was still I would say a fringe of the of financing, like, Ooh, that’s good. Yeah, let’s do that on the side. And but it really got big, quite fast. Actually. I was a bit surprised and how I was for me when I started, I say, okay, maybe that’s, I’m gonna be in the fringe of the discussion for maybe five or six years, but I mean, after one or two years, I mean the whole sustainability story almost get I mean now every asset manager puts sustainability in its front page, that’s the, that’s been the discussion at the moment.

So I would say that really sustainability has become the hottest topic now, the hot, the thing to be dealt with.

But then it’s like, how do you do it right now? And that’s the whole deal.

Antoine Walter: So that’s looking in the mirror. Yeah. But now if I look in the crystal ball, yeah. What do you intend to achieve over the next five, 10 years?

Nicola Lei Ravello: For me, it’s really Des what I really, what really like to do is designing in investment process, investment funds portfolio constructions, a as I said, as I’m really seeing it as as an engineering ex exercise, how can you design a structure that. Pull resources from one place to where it needs to go to create something, so whether that could be helping VC,

Antoine Walter: a VC,

Nicola Lei Ravello: private equity fund to, to select companies or having an investment process in there through public equity funds and also designing their portfolio construction strategy.

So

Antoine Walter: is it natural for those players , to seek help externally?

No.

Nicola Lei Ravello: that’s nothing quite new. I would say. I mean, usually there they do a lot of people do something in-house, but I see a lot of new asset managers that are more interesting to work with extend specialists, and do joint venture

And going that way.

So I think that’s also changing in the industry. Yeah.

Antoine Walter: Sure

Nicola Lei Ravello: For sure,

Antoine Walter: because for them, it’s gonna be hard to have a subject matter expert.

Like you are in house. Yeah. But not all of their investment will be water related. So maybe they don’t need you for the food portfolio, but for

Nicola Lei Ravello: Yeah. For me, that’s usually how I try to work.

Like, if you can help on a given project, maybe designing methodology or designing an investment process, then they, and then also supporting the implementation I come, I build something and then maybe I go away and then maybe I come back to build some something else, so

Antoine Walter: that’s

Nicola Lei Ravello: it’s really how I work. Yeah.

Antoine Walter: You escaped my question on your second book. Yeah. Is it still an active project because you have so many

Nicola Lei Ravello: Yeah, Yeah. Yeah. I mean, I have pretty much an idea of everything I want to write, so I’m really dedicating watch chapter to. To one type of investment, so I started with public equities as then with companies, stocks, and then startups and VC, and now it’s risk in the broader economy. And then I also want to write about microfinance about the Blue Peace piece and also water bonds, so yeah, there’s a lot of things I want to say. And I think somehow it’s all gonna come up into one book.

Yeah. The goal, what I really want to show is how can you invest in water? Not in the community itself, but all the infrastructure to, to secure water. And how is that an investment for the future? Cause I mean, we need this to adapt our societies to to climate change.

Yeah.

Antoine Walter: I had some weeks ago a discussion at microphone with Katrina Donaghy from civic ledger to discuss. They their roll out of water ledger in Australia and all the applications of cryptocurrencies and blockchain to, to the water sector.

Yeah. And if I recall rights, the first person ever to mention the combination of water and blockchain to me. Yeah. Was you, is it still something which you’re involved with?

Nicola Lei Ravello: No, not really. I mean, I followed I don’t remember the name of the company. Civic. Civic.

Antoine Walter: civic, ER, yeah. Yep.

Nicola Lei Ravello: I think that’s interesting. I think I think the use of blockchain, for designing marketplace and using the token technology a way to secure provide security and transparency in marketplace.

I think that’s a good idea. I think when we had the last interview, I just saw that and I think it was interesting, but I didn’t, I’m not involved in in any capacity yet on a, on such attack. Yeah.

Antoine Walter: Cause you know, what I’m trying to do with those interviews is always to try to connect the dots. It’s a bit like what you do with your building public with the LinkedIn pass, which is a bit, every time I uncover a little portion and sometimes I get some links

Nicola Lei Ravello: Then you try to see how disconnect to your previous post and how yeah. It’s really, for me, it’s really trying to put the pieces of the bigger picture, and see how everything goes goes together.

Huh?

Antoine Walter: You, you mentioned micro credits and I dunno if you read the book of Gary White and Matt Damon, the worth of water,

Nicola Lei Ravello: I didn’t read the book, but I’ve read the everything they’re doing. Yeah.

Antoine Walter: But they explain how water credit. So their micro credit product performs with 99 person return on the loans and how it’s allowed to bring so many people out of water, poverty, water induced poverty.

And I was just. Wondering if there could be a connection between decentralized finance. Yeah. Which could be cryptocurrencies, which could be blockchain, which could be something more traditional. Yeah. And micro credits where they struggle to find an investment fund and tell them, instead of putting 5 billion or 5 million tickets in inside a company, you have to put several 10 or 20.

I think the average ticket for what a credit is around $350. And it’s hard to go to an investment fund and say, look, you have to make tickets of three 50, but if you go to decentralized finance, maybe that’s an option. I don’t want to open a full side tribe because if not, I have to block you for one more

Nicola Lei Ravello: hundred

Antoine Walter: But just from the top of your, I

Nicola Lei Ravello: yeah, it looks interesting, the way water.org and water equity the asset management works is that they provide loans to local. so they have maybe in the portfolio, they have maybe 12, 12 loans, 20 big loans. And with the condition that these banks provide, these micro credits, so there’s also this intimidation in between. And yeah, I mean, you could use you could use

A technology, a blockchain technology there.

I mean, what I really like about blockchain, in general is really the transparency in the security you get for I’m also in involved in oceans, a lot. And for me, by from seafood is a great place, is a great industry where blockchain can really provide something, because with the blockchain, the tokenization, you can really

Antoine Walter: improve

Nicola Lei Ravello: the traceability.

Of your product through the supply chain, and that’s something that is really an issue in the seafood sector because like 25% of the fish that is sold is mislabeled. So one out of four fish, you don’t even know if it’s really,

Antoine Walter: one fish is

Nicola Lei Ravello: so it’s the same with algi as well, and algi are very specific properties in cosmetics, in health.

And so you need to know exactly which spaces it is, so with the help of the blockchain technology, you can secure the information from where it was arrested, what time what species it is and keep this information accurate throughout the supply chain. So for me, blockchain infrastructure has a, is digital infrastructure of your business is really interesting for

For sectors, an industry that lacks transparency, I would say.

And also EF and and security. Yeah.

Antoine Walter: it would be another deep dive,

Nicola Lei Ravello: it’ll be a lot. I’ll come back next year.

Antoine Walter: You said you would be coming back next year. So I think maybe we opened the door, which we can follow on next year. Well, Nicola, it’s been a pleasure to have this this deep dive with you on the finance side of things and on everything you do within that word.

I propose you to switch to rapid fire question to run it off.

Nicola Lei Ravello: Go ahead.

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Rapid fire questions:

Antoine Walter: Since last time some of them changed, but I’m not sure if all of them changed. So let’s see if your answers are the same. My first question is what is the most exciting project you’ve been working on and why?

Nicola Lei Ravello: I had many projects already. Interesting. But I’d said like the one I discussed before, like for this bran bank of redesigning the entire investment process based around water.

I mean, that was really interesting because it was really a top down big strategy. I mean, like redesigning the strategy of the bank,

Antoine Walter: can you give a name and say it UBS

Nicola Lei Ravello: No, it was prefer not, but uh,

Antoine Walter: go into my tricks.

Nicola Lei Ravello: yeah, no, I mean it’s really interesting when you start redesigning entire processes, it’s, I guess for it’s the same, if you could build your own waste water treatment plan, so it’s pretty exciting.

If you can do it the way you want, then

uh,,

Antoine Walter: I think it’s a good analogy because it’s really, you have one output, one outcome, and you have so many different ways to go from one to the others and you have to define which one

Nicola Lei Ravello: is. Yeah. And you have to design it in a way that is to a change environment. So you need to account to new issues, new problems, new parameters, and to make sure that this new project is gonna survive the new status quo, that’s pretty exciting.

Antoine Walter: you name one thing that you’ve learned the hard way.

Nicola Lei Ravello: I would say it’s I think nothing is given. You always have to push for more and stay relevant and stay up because the projects are not gonna come to you. I think you also know that and yeah. So stay connected, stay on the top of the of your competencies and your knowledge and yeah. And trying to see where you can you can contribute.

Yeah.

Antoine Walter: Yeah. Is there something you’re doing today in your job that you will not be doing in 10 years?

Nicola Lei Ravello: I don’t know, like, I also have a friend that has started his own consulting business at the same time as me and he is more to the corporate consulting. So he company advise company how to integrate sustainability.

I’m more on the finance side and we always talk between us. Like, we are always exchange, and he has more taken away of like building his own company. He always, he already has hire for people, and it’s really building his new consulting firm, and for me I’m more like I don’t really wanna build a company.

I mean, I don’t really wanna be a manager of, I think I really like what I do, so I kind of see more myself as an independent consultant, like a carpenter, like maybe I’m gonna have an intern and I’m getting some sort of mentorship going on there, but I don’t see myself. Like, I really like what I do, so I don’t see myself outsourcing maybe.

Antoine Walter: maybe.

Nicola Lei Ravello: Yeah. Maybe like, reviewing the typos and the language of the documents. Yeah.

Antoine Walter: what is the trend to watch out for in the water sector?

Nicola Lei Ravello: It’s a good question. That’s a good question. I mean, for me, the bigger picture is how water is gonna become more part of the climate sustainable discussions. Cuz I think eventually it will be one of the main, as big as carbon now, but that’s a bit of a long term and yeah, I think the valuation part is interesting as well, because since the market condition is gonna change the liquidity is gonna be probably withdrawn from the central banks, how this is gonna affect valuation is how this gonna affect financing.

That’s gonna be interesting.

Antoine Walter: I cannot avoid that sidetrack.

Nicola Lei Ravello: Should I go for it? I know it. I see you want

Antoine Walter: have you followed this story of the natural asset companies, which the Doron is putting in place together? I think with the rock feller foundation.

Okay. So you could be. Putting on the market. One of the nature services, the idea being that the first industry there is in the word mm-hmm is nature by far bigger than anything else, because it’s providing services. And if you can put a value on that,

You can raise money. To go to together with this value and that money that you raise will allow you to preserve yeah.

These assets of nature. And then it’s not something like you can invest in, in a natural park and then exit from it, exit won’t happen. But if you do the right preservation move, then the natural asset company will have a raise in valuation. Yeah. And then you can

Nicola Lei Ravello: yeah I mean, I didn’t look I didn’t know this particularly.

I’m gonna look it up, but I think it’s the same story for carbon credits. Like if a forest or a park or Marin park can get some financing, by issuing, carbon credits from the forest, it has, then you can use this financing to preserve its own park. I think that’s a great tool

Antoine Walter: And that brings the liquidity, which you

Nicola Lei Ravello: yeah.

That’s that provides the liquid that provides the cash and liquidity for the park to to just, I mean, to patrol, if it’s a Marine park you need to constant patrolling, I mean also not normal park in Africa, I mean, poaching is such a big big issue that even if you have low, you need to spend a lot of money on patrolling.

But it can also be I mean, you need to be careful with it because you can also backfire, I mean, I’ve seen stories where some some farmers in the UK or some park developers were squeezed out because suddenly these forests has generic cash flows, and then the, some banks or asset managers want to buy them to, to have access to this money streams, and they may not have the desire to protect or put this cashflow into forest protection, so

Antoine Walter: it’s always hard to walk that very fine line.

I, I really told that story on that microphone that I was giving a conference in a university, in, in France and at the end of the conference not the students, but a lot of the professors just stood up and said, you’re like you’re supporting the capital devil. Yeah. And and you should not make water sustainability environment on one hand and finance money and investment.

On the other hand, those two words should be excluded one from the other.

Nicola Lei Ravello: Well, I think it’s the whole discussion is sustainability. Like, I mean, I think capitalism for as a system of society for the last 250 years or so was working really well until it met planetary boundaries, I mean was working well for fringe of the population.

You all have a lot of social issues underneath of that, that is, needs to be fixed as well. But now it’s how do you change? How do you adapt that system? Should we just forgo all finance? I mean, is that even possible? Can we switch from this to another system, or you’re trying to find concrete and some solution on the spot, so those carbon credits, they might be some greenwashing, they might be some bullshit, but then they also can bring money to. On the table to, to finance the conservation of the park, so

Antoine Walter: mixed feeling as a summary

Nicola Lei Ravello: yeah. Yeah. I mean, I think I see it’s like any tool, I mean, you can build

Antoine Walter: it’s about what you do about it.

Nicola Lei Ravello: What’s what you do about it. Yeah. I think that’s the bottom line. Yeah.

Antoine Walter: Let me bring you back on track. Yeah.

Nicola Lei Ravello: sure.

Antoine Walter: and sorry for the sidetrack. I couldn’t

Nicola Lei Ravello: no I like it.

Antoine Walter: If you were a world political leader.

Yeah. What would be your first action to influence the fate of the worlds? Water challenges?

Nicola Lei Ravello: Good question.

Yeah, I think education about water. I think it’s important, really trying to understand show how water is really important for everything, for not only for business and the economy, but also for everything we do, . Yeah, I think in investing in awareness and education can do, can go a

Antoine Walter: long

Nicola Lei Ravello: way.

And because I think, and I, that’s, what I see from what I write is when people have this haha moment, then it becomes quite clear, it’s, you see everything as a, in a new way and how everything is dependent on water, so I think if you can support education and awareness, you can go a long way because I think there’s gonna be a need to a shift in mentality and a shift in mindset, to cause a lot.

There’s still a lot of people that don’t want to see the problems at hand and say, oh, we can we can ignore it a bit longer, because uh,

Antoine Walter: that’s the thing of the full word of SaaS where you have, you can have your full funnel. The important thing is the activation metric and there is one single activation metric, which is gonna be exactly this aha moment you mentioned.

And it’s true that if we

Nicola Lei Ravello: can.

Antoine Walter: activate that and find out what is this activation metrics so that everybody sees, like you break the hollow effect and you all of a sudden realize that

Nicola Lei Ravello: you break the fantasy. The, yeah. Water

Antoine Walter: is, I mean, water is everything is an empty sentence, but the consequences of not water or too much water of too few. And that,

Nicola Lei Ravello: well, I think sooner or later this is gonna happen, the goal is to make sure it happens soon enough

Antoine Walter: would you have someone to recommend me that I should definitely invite as soon as possible on that microphone?

Nicola Lei Ravello: Do you know Frank Barroso from Waterpreneurs in Lausanne? It’s it’s a company based in Lozan. They organize water conference, water events, where they bring a lot of new startups and finance here together to and also a lot of people connected to water together to see if they can match some stuff.

So yeah. Maybe try with them. Yeah.

Antoine Walter: And if people want to follow up with you, let’s say I’m an asset manager and all of a sudden I clicked because I listened to you during this full hour.

Yeah.

Nicola Lei Ravello: Yeah.

Antoine Walter: Well, shall I

Nicola Lei Ravello: I’m reachable on LinkedIn. As I said, there’s a lot of I write a lot there on a daily basis, so I can be rich there or to my website.

Yeah.

Antoine Walter: So as usual,

Nicola Lei Ravello: Yeah, the I’m pretty traditional for that. yeah.

Antoine Walter: very good Nicola. It’s been a pleasure.

Nicola Lei Ravello: Thank you for

Antoine Walter: your, and uh, see you probably next year.

Nicola Lei Ravello: Yeah, I will be there. we can go. We can have a podcast outside next time.

Antoine Walter: That’s yeah, that’s

Nicola Lei Ravello: by the river by the Riverside. I mean, we can have a podcast near the water, yeah. Okay. Or in the water if

Antoine Walter: so the next one is a Zurich lake

Nicola Lei Ravello: podcast? Sounds good. Sounds good. Yeah,

Other Episodes:

FREDsense: Revolutionizing Water Quality Monitoring with Biosensor Innovation

By Antoine Walter | 7 May 2025

Swirltex: Revolutionizing Wastewater Treatment with Bubbly Innovation

By Antoine Walter | 30 April 2025

Blue Foot Membranes: The Next Evolution in Water Filtration

By Antoine Walter | 16 April 2025

Echo River Capital: Pioneering the Future of Water Innovation

By Antoine Walter | 3 April 2025

1001 Fontaines: Engineering Sustainable Water Access Through Social Entrepreneurship

By Antoine Walter | 22 March 2025

Amazon’s Water Footprint: Tech Giant’s Quest for Water Sustainability

By Antoine Walter | 19 March 2025

Turing: The AI Revolution Quenching the Water Industry’s Thirst for Innovation

By Antoine Walter | 26 February 2025

Altillion: Pioneering Digital Intelligence for Water Asset Management

By Antoine Walter | 6 February 2025

Flocean: Pioneering Ocean-Based Water Solutions

By Antoine Walter | 15 January 2025

Botanical Water Technologies: Harvesting Liquid Gold from Plants

By Antoine Walter | 4 December 2024

The post How to Admit, Value, and actually Overcome the Economic Risk of Water appeared first on (don't) Waste Water.

Why and How? Let’s review!

with Scott Bryan – President of Imagine H2O

Imagine H2O is the world leading Water Innovation Accelerator with $800+M raised in early-stage funding and 1.1 billion people (and counting) served.

What we covered:

How Imagine H2O’s Alumni network now extends to 168 portfolio companies in 20 countries

How Imagine H2O launched in 2008, creating the water innovation accelerator concept from scratch

How the organization’s concept first was a Business Model contest, how it pivoted from there, and why

How Imagine H2O swiftly realized that to accelerate water technologies they had to work on water technology adoption

How only 1% of climate tech venture investments flow to water today and why it is problematic

How Imagine H2O’s non-profit business model works, and who the organization partners with to maximize its impact

How market competitors can incredibly work together to take new solutions off the ground

How entrepreneurs entering from other sectors bring a breath of fresh air and how fun it is to work with them

How sometimes, entrepreneurs hang around a little longer than they should in the Water Industry

How some valuations we currently see in the Water Sector can be detrimental to both the founder and the investor

How the booming accelerator playground offers incredible resources for entrepreneurs while also reaching some boundaries

Focus being the name of the game, the criterion to work with Imagine H2O, the most important thing to look at as a water entrepreneur, water as a global opportunity and a local market, scaling up, building for the long-term… and much more!

… and of course, we concluded with the 𝙧𝙖𝙥𝙞𝙙 𝙛𝙞𝙧𝙚 𝙦𝙪𝙚𝙨𝙩𝙞𝙤𝙣𝙨  

Resources:

Have a look at the Imagine H2O’s website

Come say hi to Scott on LinkedIn

is on Linkedin

Antoine Walter on LinkedIn

Teaser: The Leading Water Innovation Accelerator

Infographic: The World’s leading water innovation accelerator

Full Transcript:

These are computer-generated, so expect some typos

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Antoine Walter: Hi Scott. Welcome to the show.

Scott Bryan: Thank you, Antoine, great to be here.

Antoine Walter: Actually we have so much on the plates that you wanted to have it launched before it was launched. That’s really a good mood and a good energy. I really praise that!

And there’s a lot we will discuss today because I mean, everywhere was looking around internet to prepare for that discussion, you were listed as the leading water innovation accelerator. So I’m really looking forward this view of the market and this view of the ecosystem from the guy who leads the leading water innovation accelerator, but that all starts with our good old traditions on that microphone of the postcard.

And basically I’d like you to tell me something about a place, which I wouldn’t know by now. And that’s your post.

Scott Bryan: Sure. Sure. Well, yeah, kind of in the middle of nowhere right now just back from Singapore international water week, we’re ha how to just a fabulous time working with our partners and startups there. But yeah, after a plane ride to , another part of the world back home I’m actually in Bozeman, Montana right now.

Where it’s springtime, we’ve got a lot of snow in the mountains and we’re really hopeful about the summer and hopefully it won’t be too smoky. But Imagine H2O we’re based in San Francisco. I’ve lived there for the past, nearly 20 years. And certainly thinking a lot about the drought that they all are experiencing and certainly looking forward to seeing how we can be helpful to our partners.

Antoine Walter: So that’s really something I like to explore with you over the next hour, Imagine H2O, or to go into the details and everything you do about it. But right before, like to get to know you a bit better. And when I was reviewing your path, I saw that you started your career in ESG research and.

That sounded like something really visionary by the time you were involved in that? Um, I really, the layman here or was it visionary?

Scott Bryan: Yeah, I was really fortunate to get into that space in the early two thousands when it was really making this interesting transition from being about socially responsible or values-based investing to ESG. And I think it was great timing in the sense that at that time, institutional investors were really starting to see these trends as they related to long-term value creation and risk.

It’s kind of crazy to think that at the time it was really. Finding management teams that at least acknowledged the science of climate change. And I think we’ve made some progress on that, but also looking at board diversity LGBTQ hiring issues other labor issues.

So, it was a fascinating time, but I think on the climate side, especially having a front row seat, working with pension funds and foundations that were engaging in shareholder activism screening for . Management teams that didn’t yet acknowledge climate science, but then also being proactive around clean tech investments, both on the venture side, but also project finance.

So, that’s really where I started my career, but it was really in that context, that water seemed like a logical area. For long-term risk management and opportunity yet it really wasn’t receiving the same attention as renewables and other parts of the clean tech sector. And really didn’t have the vibrant ecosystem that one might expect for an industry of this size and prominence to both humanity and the earth.

Antoine Walter: You’re saying it didn’t get the same attention. So does that mean that by now it gets the same level of attention?

Scott Bryan: I think we’re still working on it and that’s what we’re all about. But yeah, I, I think from an investment standpoint, water is still less than 1% of all climate. Venture investments and that’s an issue that will change don’t necessarily think that water always fits the venture model.

And I think that’s something that we’ve learned as an organization but certainly at the corporate level and even utilities that are now, racing to net zero that, water solutions I think are getting a lot more attention. I think the challenge though the solutions are often complex or they sit in the back of a wastewater treatment plant and no one ever sees them.

It’s not a solar panel on your roof or a Tesla and your driveway or a windmill on the hill. these solutions can be complex. And how do we demystify them and get, larger audiences of people to understand what water innovation is. And what’s possible.

Antoine Walter: guess that’s exactly. What’s what you do with imagine H2O. I like to go to the roots of that story, because actually you were the first employee, if I’m right. of Imagine H2O. So what’s the story behind that? How do you get to be that first employee and maybe for the two guys in the water industry, which don’t know, Imagine H2O, yet what’s your elevator pitch to Imagine H2O.

Scott Bryan: we’ll really Imagine H2O you show got it started at Harvard business school. And it was Tam and packet and Matt Evans who are on our board that founded the idea and they were working with a professor on what kinds of resources would be necessary. Innovation and startups in the sector, and again, comparing it.

to other industries that they saw.

I just happened to link up with them through a couple different routes. I was in San Francisco again, at the time I was working at Royal bank of Canada and we had just launched a philanthropic initiative called the blue water. That was looking to support water solutions. And we had done a lot of early work with traditional water NGOs, but we wanted something like Imagine H2O.

We just didn’t know it existed. Something that could be about entrepreneurship, innovation, and hope. And that’s what brought us to imagination H2O. Oh. And we actually underwrote the organization for its first three years. I was on a volunteer team helping launch the organization with Tim and Matt.

And we actually did an executive search. We were looking for someone to lead. The organization happened to be 2009. When the financial world was changing pretty rapidly. And I thought, gosh, if we’re not finding the right person, I think I might be that person for the job. And the rest is history.

So it’s been a really. Fascinating ride certainly learning experience to build a new organization in this space.

Antoine Walter: How would you define Imagine H2O today

Scott Bryan: definitely as a water innovation accelerator, that’s the core of what we do, but I think we really evolve the model a bit. So it goes beyond. Purely recognizing the company and our first few years we were business plan competition. We then just saw the winners turn around and leverage the judges, our staff, even our interns to find investors and customers.

So there was a quick pivot toward the accelerator model but still operating under the assumption. The problem was the lack of investment in the space. And that’s where we really focus on building a track record with investors. Since then our alumni have collectively raised over 800 million in early stage investment.

So I think we really proved our ability to be effective there. But over time we saw investors come back to us and say, well, who’s actually using this stuff. Why is the customer adoption piece taking so long? So it’s really been the last five or six years that we’ve really focused on building out a network of tech adopters in the municipal, industrial and agricultural markets that really serve as a.

A platform of warm leads or entities that are willing to pilot new solutions. So I wouldn’t say we’ve solved the customer challenge and water altogether, But I think we’ve really made some great progress as far as creating a place where an entrepreneur can come get their idea, validate it connect with investors, and really benefit from all that we have to offer as an accelerator in the form of capacity development visibility and insight.

Antoine Walter: I’m not the biggest, specialist there is of accelerators, for sure. Not it’s a topic we’ve been discussing on that microphone sometimes like with with Kimberly Baker. Susan M bit more recently with John Robinson. I’m just wondering to me you seem to have a quite special approach to that because you’re a non-profits and because you don’t take equity in the companies, is it special or is it to me, which is wrong with that.

And if it is special, why did you decide for that.

Scott Bryan: We were structured as a non-profit really from the get-go and saw that our work was going to be bigger than simply accelerating startups, but, really. Identifying the challenges and looking at the opportunities to solve them. And we just started with the entrepreneurial piece.

But we certainly understand that there’s ties to policy public awareness and storytelling. There’s a lot that we can be doing as an organization. And hence the name imagine H2O. But in the entrepreneurial space. Yeah, I think we. Been unique in the sense that we were very early mover. And we’ve not taken an equity model.

That’s allowed us to partner with a lot of municipalities that are often the major buyers of solutions, but also the ones that face the most challenges and sometimes political scrutiny. So if we can be a partner to them, And remove any conflicts of interests. We’re not a consulting firm or nor are we a fund that.

really enables us to maintain this neutral convener status.

And I think that gives us a fascinating in a vantage point in the sense that we’re kind of at this nexus between entrepreneurship investment philanthropy and the public sector.

Antoine Walter: I don’t want to push you in a corner. I mean, I get the big picture. I’m just wondering who brings the money in the game because you’re non-profit right. But you still need to be sustaining what you do. What’s the, I mean, business model doesn’t really apply as are a nonprofit but what’s the way all of that works?

Scott Bryan: Yes, we’re non-profit in the business model is impact and outcomes. So a good portion of our funding comes from philanthropies. Oftentimes these are families that have a passion for these issues and are doing a lot of grant making on the water conservation and access side.

And view us as being complimentary to that approach. And sometimes we’re even a toolbox to their grantees. On the corporate side we partner with the likes of Xylem, Suez, Kubota Kurita. TetraTech all of them. View us in a way as of a partner to their open innovation teams. So we’re early eyes and ears on the ground.

That’s again, acts as a filter, but really brings people together. And I think that. Again, because there’s not one single corporate entity that kind of controls everything we do. We are that platform solution that in some cases, peers or competitors are partnering on. So, when I get on our judging calls I’m always impressed to see it.

If people that may be sometimes compete in the market, actually working together, looking at a new solution and thinking about how do we help this entrepreneur?

Antoine Walter: And what are the typical entrepreneurs, which you help, what it was a terrible way to to phrase it. Who are they? What kind of companies do you help?

Scott Bryan: I think the fun part of our job has been , to find those entrepreneurs that are entering from outside the sector that bring talent and know how . From renewables or biotech or big data. That’s I think some of the really rewarding work, but we also worked with serial entrepreneurs that have founded other companies and bring that experience.

And then there’s certainly people that have been in the water industry and it played prominent roles within large corporates, but see an opportunity to do something on their own. So, it’s really going to have a. When I think about the human capital and kind of talent piece of our work, that’s where I really get pretty excited.

Over time we’ve probably moved. Later stage when we first started again, it was a business plan competition. So we even had enough pre-revenue campus ideas submitting their ideas water, smart software, Rob and Peter submitted their draft business plan to imagine H2O.

That was their early indicator of, Hey, this is a go. But I think over time we’ve probably moved more towards early revenue. Companies that have

some kind of technology, at least a prototype. And I think that we’re probably more of a scale up program for those kinds of entrepreneurs, but I don’t want to move too far from our roots and even with our program and Singapore, know, we offer clinic programming to help those kinds of pre-revenue ideas. And I think we’ll do more of that because I think it’s really important. You can’t. Simply be looking at early and got a growth stage companies in this space. You’ve got to, again, kind a prime, the pump, and we thinking about how we bring new talent and ideas in.

Antoine Walter: And how long is your involvement with those companies?

Scott Bryan: Our accelerator programs are typically 10 to 12 months long. But we’re now finding that we’ve got some repeat customers. So, companies like Sentry or Drinkwell that have gone through all three Imagine H2O programs, our accelerator, imagine H2O Asia and the urban water challenge.

So there are times where we’ll work with a company over, I think with Manasseh drink, well, Probably worked with.

him over, off and on for the past six or seven years. Always that kind of the right time for him based on the program that we offer.

Antoine Walter: You’re an accelerator, and you can change the path of those companies. And I do get that you have especially network to make it happen. And I’d like to go a bit deeper into that in a minute, but right before, like to understand a bit the timelines, because. I had the discussion that the microphone with Paul O’Callaghan who wrote his thesis about the dynamics of water innovation, and he was able to show that it takes 12 to 16 years for technology to be in the middle of the market.

And then very concretely. I had Andrew Benedek on that microphone discussing how Zenon took off from the early start in the eighties for the moment where they were in the middle of the market, which is late nineties to two thousands. It seems to me that even if you have the best technology in that very specific markets, that the water industry is it really takes a while and a lot of dedication and we’re discussing decades before you see a major dent.

Can you bend that? And how can you differentiate between resilience to an idea and the commitments to execute it and pushing a dead body?

Scott Bryan: I totally agree with Paul and Andrew on those timeframes and we need to be realistic with all those all who are involved. And I think sometimes people ask us. Differentiates a successful entrepreneur from one that doesn’t succeed in this space. Then oftentimes I find myself talking about the founder and the team and their understanding of those time horizons.

We certainly work with entrepreneurs that just get impatient and move on, and I think that’s a healthy thing that has to happen. But I think in our own work and how do we really bend the arc, if you will, and shorten these timeframes, this is where I’m pretty optimistic more on our work to actually fund pilots.

We provided over 1.4 million in funding to pilots in 16 countries in the last few years. And. One that removes the financial barrier that a lot of utilities will say, Hey, we don’t have the money to do this. Well, if you remove that then it’s pretty amazing how quickly things can happen.

And beyond that, we funded 1.4 million, but the recipients of those funds have then gone on to secure over 7 million and follow on funding. So, everything that we do it really kind of comes with or starts that, where can we be? Catalytic player in this space, but then how do we align with, and find partners who can provide that follow on funding?

So I think that’s one area where I think we can move things faster. But I would say, a lot of our work is trying to help entrepreneurs get to yes or no. And encouraging again, the entire sector to be better at that. Because we can’t afford to have to string a lot of people along or nor can we just be patient and say, well, water’s conservative.

This takes a long time. We really need to be realistic about, what the solution is, who the team is behind it. And can this be something that is really going to be valued in the market over time?

Antoine Walter: In the figures, which you showcase on your website. I saw that you have an 80% survival rate across your, if I’m right, 168 companies in portfolio, and I’m wondering, is that good or bad?

Scott Bryan: Yeah, great question. And I sometimes say, well, there’s an asterix on that because I do think sometimes entrepreneurs hang around a little longer than they should in this space. And I would say there, there is a percentage of our companies, and I think we’ve gotten better at identifying them early and avoiding them where they can go from paid pilot to paid pilot.

And it becomes more of a. Lifestyle business for the founder rather than the true growth opportunity. So, I think we learned our lessons early on there, but I think we’ve gotten better about, identifying companies that have real commercial liability. And I think a lot of this has done.

Partly we’ve been in, thanks to a lot of the judges and people that volunteer their time that bring that expertise. So I think we’ve got a great selection process but then couple that with a really strong accelerator program. And that’s how you get to that number, which by the way, is essentially consistent with most accelerators in Silicon valley.

So when we think about our peers outside the water space, I think it says that we’re doing something right. I do think we could probably start to take more risks. And, not be afraid to see that number decline. Because I think, again, that’s what we all need. We need to be trying things and be thinking bigger than we have in the past.

But I think right now I’m very pleased with that track record that we’ve been able to build over 12 plus years.

Antoine Walter: I found a figure of the the amount of venture money that went into water tech in 2021 because when 22 isn’t over yet, and that was $417 million. And on that same microphone, I had Reinhard Hübner share how, according to his vision of the markets. I mean, what would he. Seeing every day, there’s too much stupid money chasing too few good targets to quote him.

Scott Bryan: Yeah.

Antoine Walter: How can you filter that? Is a stamp saying, image H2O on a company, something which tells investors that it’s a safe bet or do you have that role in, in the market of a catalyst?

Scott Bryan: Oh, yeah. We really help entrepreneurs navigate a very complex investor landscape. And I think because these solutions are so localized or specific to a particular market, there’s not going to be one investor that is , successful at being a resource to a founder across the board.

So I think that. Helping entrepreneurs find the right capital is a role that we can play in the form of us building out our investor network. But that’s not our role to say, Hey investor, this is kind of, this is our take on this company. That’s where I think we let the market do its part.

But I think to that point, agreed last year I think we were about 40% of that number. So, our alumni definitely continue to raise more and more. And I think that there is more capital available is that smart money or not? I think that’s one up for debate.

I do think, again, back to our earlier days, we did see some impact investors come in and they were just so excited to do a water deal that you saw valuations that didn’t necessarily benefit the founder or the investor. So I do think that we need investors. I can share the tough facts with the founder as far as expectations and numbers.

But I do think that there’s better entrepreneur ships are across the board. I think we’re seeing a higher quality of entrepreneur, but also a higher quality of investor in the space. And I would point to, I think. Again, kind of the arc that we’ve been on is this in the sense that we’ve really moved away from being an industry of tinkers to one of entrepreneurs?

I think we’ve gotten better about that. But I also think the investment community has also had to evolve.

Antoine Walter: so that’s , one end of the story. The other end of the story is what you mentioned with your tech adopters. And we’ve been alluding to the fact that this industry is quite conservative. So I’m wondering in a quite conservative industry, where do you find tech adopters, which say, Hey, Imagine H2O is knocking at my door and bringing me a new company.

And for sure, I trust them. Let’s do a pilot.

Scott Bryan: Again, I think that network is really, again, built. Good entrepreneurs to yes, no faster. And having a diverse network of end users that believe in entrepreneurship. But also understand the limits. I would say that, again, it’s important to remember that water is a theme, not an industry, and some industries are gonna move faster than others.

And I don’t think we can always assume that. The fragmented and conservative nature of the market that we see is always going to be true. And I think that whether it be in food and Bev or companies that are find themselves operating in a more. Regulated environment, there will be different timelines for adoption and I’m hopeful.

But again, I can’t say I’d point to one industry that’s able to move faster than others as far as water adoption. I think food and Bev has been a great partner to a lot of entrepreneurs we work with, but , these are very localized solutions and a major food and beverage company might manage its facility in one region, very different than another region.

So finding one water solution that can be rolled out across an entire enterprise is difficult and not always realistic.

Antoine Walter: There’s quite a lot to unpack in what you said. I would say I see two follow up questions. The first is , simply going to give us some example of those tech adopters and what they commit to. And second, when you mentioned food and Bev what did it make sense at some point to. Narrow a bit, the water industry, which you mentioned is not an industry, is a theme, and to say let’s go to some specific verticals.

And and let’s share that we take all the challenges in those verticals and we explore them and we’ve, we find the right companies for those right challenges.

Scott Bryan: Our tech adopters, our leaders generally across the municipal industrial and agricultural sectors. And they commit to a meeting with our entrepreneurs. When there’s a fit, we’re not going to force an awkward marriage. We really want. Impactful outcomes. I think in the municipal space partners like Eby, mud or metropolitan water district have really been active in piloting our solutions.

And in the case of Matt, they’ve even provided additional research funding to our companies. So I think that there are examples in the municipal space. Singapore pub DC water and others where we’ve been an active partner on the industrial side. Yeah. I think just being a California based organization, we’ve had the benefit of being close to the central valley and thinking through.

The wastewater challenges that food and beverage companies have on the processing side, but even growers like Driscoll’s and what technologies can they deploy in the field and sometimes in land that they don’t necessarily own. So I would say it’s as much about, matching entrepreneurs to these networks as it is about us learning about what their pain points are.

And. Messaging them out to our community. Again, I think we’ve got to have entrepreneurs understand what the customer wants, at the outset. And the earlier we can make these conversations happening. So it’s not just about a sale or a pilot. It’s really, what do you need? How can I make your life easier?

That’s the kind of conversation that we often have between our entrepreneurs and our tech adopters.

Antoine Walter: You mentioned how the landscape evolved during the 12 years of existence of imagine H2O. Today, when you’re helping entrepreneurs, do you still have to teach them that it’s not about the tech it’s about solving a customer challenge or is it really something which is a skin, which is, which became even, I know it it’s common place

Scott Bryan: We definitely have to teach that lesson and the application process and certainly have a 250 to 300 companies we see each year. There’s a portion of them that don’t get that. And if anything, the value that we bring to the sector is telling that subset of entrepreneurs of, Hey there’s a market that you’re getting into come back when you’ve identified that beachhead.

On the other hand, I think with entrepreneurs that we ultimately select and work with. They’re big thinkers. They’re ambitious. And sometimes you have to bring them back and say, no, this is the beachhead market that you said you were going to focus on. Yes. You’re trying to hit up, grow or spread the risk and think about how you get into other sectors.

But you’re not going to be able to enter three markets at once. And I think on the digital space, this is where we see it a lot. That’s where it’s.

very tempting for an entrepreneur to say, okay, I can have a few customers in the municipal side and then I can go work with. You know of industrial water as well.

That’s a fine line. And especially around creating cashflow early on for these companies it’s tempting. And I think , our role is to help entrepreneurs understand what the pros and cons of that might be.

Antoine Walter: from the companies you’re in portfolio and all the ones you’re speaking with every year. Do you see a pattern. In where they want to heads, I’ll just give you my preconception. And so you’ll tell me if I’m wrong. My preconception is you hear the stories of bringing water to all of what is scar city, which is hitting quite hard.

And you’re thinking all those people will be lacking water. So I need to help them. And it’s, people’s, who’s going to be the municipal side of it. So I would expect more people looking into that sphere. Whereas, if you look at the water use and the places where the challenges are probably the more intricate and there’s maybe a bit more space for new comers, it’s maybe more the industrial side of things, but you might not discover it straight away.

You might need to get an accelerator to open your eyes and to bring you to the right section of the market. So that’s my preconception. Would you say it’s somewhat accurate or would you fully disagree with it. .

Scott Bryan: I think that the majority of entrepreneurs that we ended up working with they’ve gotten more precise. And maybe that saving the world piece is what’s driving them, but you’re not going to boil the ocean here. You’ve got. To start somewhere. And I think that starting in a beachhead and understanding where you can find those opportunities for scale, that’s what keeps these teams going.

And it’s the same for, ignition that we’ve worked with that, brings tropical weather forecasting to, I think they’re over a million small plot farmers in Africa that they’re working with to a membrane company. I think what keeps these founders going is that understanding of making progress in this space. And.

that can be very tough. If you’re going to say we’re going to go reach a billion people. That’s just not a realistic starting point.

Antoine Walter: And when you discuss. These intrepreneurs. Is there something which is a red flag for you, where you say no way? If that’s your argument where that’s your reason for being in business, where that’s your added value, then it’s not a good fit for us.

Scott Bryan: It first and foremost, we only accept. Startups that are incorporated as a business, or if they’re pre-revenue, they have plans to incorporate as a business. So we’re not supporting other nonprofits. That’s what philanthropy is really set out to do. So we really view a successful. Water innovation business as representing a truly sustainable solution to a water challenge.

So we’re not about, creating more projects. We’re really thinking about what’s going to be valued in the market that will employ people and solve pressing challenges. So, if we’re not talking with entrepreneurs that get that piece, that yeah, we will say. See you later. And sometimes the idea might just be so far off base.

Yes, we definitely need to think big in the context of climate, but yeah, towing icebergs from the Arctic, we’re going to be realistic with an entrepreneur that brings us that idea. And we’ve seen plenty of them. There, there are a lot of people out there trying to do that. Again, I think hats off to everyone.

That’s trying to think of a creative solution, but we are very, I would say realistic about what we’re trying to accomplish as an organization.

Antoine Walter: I made a deep dive and the trilogy on that microphone about towing icebergs, which sounded to me like the most crazy idea when it started. And when it ended, I was like, why did nobody ever try it? So I still don’t have a religion that, where I’m heading with that is how crazy is to crazy.

Scott Bryan: Yeah, I don’t think I have a good answer to that, but I will say reflecting on this question with our team is yeah, we would like to be able to take some more risk and I think we’ve gotten. Good at what we do when it comes to validating idea at providing an access to capital, but are there some technologies out there that kind of delve into the space of a really big thinking?

We’re still going to say no to an entrepreneur. That’s trying to defy the the laws of thermodynamics or doesn’t believe in unit economics. So that’s that piece of reality we’re always going to touch on, but certainly we’ve seen companies come through claim something and our judging panel says that’s just physically not possible.

But I also think we’ve got to keep an eye out for an issue like PFS. We’re still a ways off from having a real suite of solutions that can be deployed in the communities that need it the most.

Antoine Walter: I was to try to push the envelope here, I’m really giving you something which is written. On plates and on t-shirts. So it’s really lame and it’s this sentence, which is attributed to Einstein all the time, and they’re pretty sure and have a pronounced data of craziness is doing the same thing and expecting different outcomes.

So among your advisers, who verifies? I mean, if you come with something which is extreme, thermodynamics was know one example, but really. Far away. I had a discussion on that microphone with Gerald Polack, for instance, on the fourth phase of water and his looking at ways to bring that to market and to bring technologies around that yet, if you go to physicists, they would tell you that they are not four phase of water, that aging phases of water, and those are the rules of thermodynamics.

But yet the exception of Gerald when it comes to the force of his water is very different from a physician, which is looking. The table of elements. So some will call it genius. Some others would call it being a different kind of thinker and some others would say it’s crazy.

Scott Bryan: Yeah.

Antoine Walter: And you will have to decide in which box you put it.

And what’s your process for that?

Scott Bryan: Yeah I think. We’ve got to get better about creating those sandboxes, if you will, where those ideas can thrive. I think that there’s some exciting. Developments on the research side, just from a pure federal funding aspect. So something like now we, which we’re a part of here in the U S a DOE funded initiative on desal and energy.

That’s we need to be able to encourage that kind of R and D and provide the support mechanisms for researchers. I don’t necessarily think that’s been our role or will be for the foreseeable future. But I think that we can be the right partner when that research starts to show some promise.

Antoine Walter: So this involvement of governments and funding makes for very good transition towards Singapore, which is the country known for having decided in the sixties that if they wanted , to become what they wanted to become, they had to start with water and the result is spectacular.

And you’ve opened H2O Asia one year ago, if I’m right.

Scott Bryan: It’s actually 2018. So we’ve been over there for a little while and have run a three, three cohorts there now.

Antoine Walter: What was the aim of creating something dedicated to that region? And what did you differently there that you would be doing from the original Imagine H2O?

Scott Bryan: Yeah. I think of a phrase that stuck with me very early on in our days and imagined the stroke came from David Stanton and that’s water is a global opportunity at a local market. And I think as we started to. Evolve as an organization and look around the world for where are those markets that are moving faster?

Southeast Asia was just an, a natural one. And we had discussions with Singapore pub on and off, really from the very founding of imagine H2O. So when the time was right. We set out to build something there that wouldn’t just be an accelerator for Singapore for entrepreneurs from Singapore, but also be a kind of a deployment bridge if you will, for global entrepreneurs and regions throughout the region.

So, that’s been a different piece to do both the acceleration and the deployment piece in one program. That’s allowed us to work with very early stage and pre-revenue ideas from, local universities and entrepreneurs, but also be a great resource for a company like century from

Canada, looking to deploy solutions in Vietnam.

Antoine Walter: So, how do you help you in the same program? That those very. Types of companies.

Scott Bryan: Yeah, it’s essentially two different tracks. But it’s yeah, it’s accelerator resources for regional startups but more on the deployments. For global ones or growth stage companies that are they’re really ready to deploy there. And that’s where we’ve launched a new partnership with the world bank called w tap, where we can provide pilot funding to entrepreneurs working throughout the region.

So that, that’s a really, I think, exciting piece for us to be able to provide that support with a partner like the bank

Antoine Walter: You mentioned this global opportunities and the local markets. Do you have further plans to expand your coverage of the various regions?

Scott Bryan: I think that’s still in the cards for us. And that’s really what we set up to do. And we started imagining show Asia, but on the other hand, we were reminded that you got to get this right. And really gonna prove that the model can work at the hub or regional level. Very positive and optimistic about what we’ve done there, but I still think there’s a lot that we can be doing across Southeast Asia and south Asia.

If anything, I’ve looked at our applicant numbers and to see increasing interest from entrepreneurs in India. And I think there’s a lot more that we could be doing there via our standard programming or something.

Antoine Walter: So you have three tracks. So we have the imaging H2O, original

Scott Bryan: Yeah.

Antoine Walter: Imagine H2O Asia. And what’s your third truck

Scott Bryan: The urban water challenge

that really started in the aftermath of Cape town and day zero. We were working with some of our philanthropic partners on what.

do you do for these coastal cities that really are on the brink. And it’s been a fascinating partnership. 11th hour racing is one of the partners on it.

Ocean kind, being the other. Those are both philanthropic organizations. Have a strong commitment to ocean health, but also see the connection between ocean health and wastewater. So that’s a, that’s certainly a piece of it. But really thinking about scarcity circularity, decarbonization, decentralization, those are all themes within that program.

And the award is up to a hundred thousand dollars per pilot through the urban modern challenge. So it’s really become our Marquis pilot funding metrics.

Antoine Walter: mentioned how century was taking all the. So, what did they do in the urban watershed?

Scott Bryan: They were actually deploying a solution the wastewater treatment plant in south hollow and using that program to test out the international markets. And since I think they’ve done more of a focus on Southeast Asia and that’s where they’ve participated and Imagine H2O Asia over the last they were, we were just with them in Singapore water week a few weeks ago.

Antoine Walter: I mentioned it in the opening, how Imagine H2O is always referred as to the leading water innovation accelerator. And I think it’s not only referred to us that it really is that you’re 12 years in, in between. Many other programs have been launched is it’s all serving the same cause and hence very good news across the board, or is it competition?

Scott Bryan: Look, I think the more resources for entrepreneurs in this space, the better we need to help them win. This is in general entrepreneurship and innovation remains an underutilized resource in the global search for solutions. And I think the more that we can do the better on the other hand, I’d like to see more coordination across these programs.

And I do. Wonder how many accelerator programs does a startup need to go through? And is there a point of diminishing returns that a founder might be tempted by, grabbing more attention and headlines versus you, at some point you really got to go operate a business. And again, we learned the hard way early on, we gave some gold stars to entrepreneurs that could win a business plan competition?

Running a business was another piece of it. So I really think if we’re going to be, if this is a route kind of helping entrepreneurs, when we’ve got to be very strategic about where these programs help them and when and make it less confusing. But, I know there’ll be more programs in this space and I, again, I think largely it’s a good thing.

But I do come back to, how does this make the N entrepreneur’s life easier and that’s not always the case.

Antoine Walter: What’s your long-term vision, because I had seen when you had 150 companies in portfolio was saying, we have 150 and we want to have 150 more, which sounded to me like a way to say we’re here for 12 more years, but also that there’s an end to it. So is it like that or what’s your longterm.

Scott Bryan: Long-term name is. Take what’s been a successful model and scale it. So I think our pilot funding is a great opportunity of where that four or $500,000 a year. Be a multiple of that. And instead of thinking about 40 pilots, how do we think about 150? So that’s a piece of it. We definitely want to keep an eye for quality over quantity.

But I do think you’ll see us do more on the ecosystem building side and being, providing more offerings to the entrepreneurs. We decline each year recognizing that some of our best companies have applied to Imagine H2O three or four times before they get in. So I think that will be another aspect of it, but I think any good nonprofits should be thinking about its ultimate demise.

You’re here to solve a market challenge. And if you don’t. Nailed it, as far as creating a lasting solution then you have to really question the model. So I think for us, as you start to see a healthier ecosystem for innovation, in which an entrepreneur can easily find the talent and capital and customers, then there’ll be less of a need for this kind of work.

But clearly there’s still a long ways.

Antoine Walter: And what’s your north star metric for success. Is it Imagine making spectacular exits, or is it this fact that you’re now able to disappear because the challenge you wanted to solve is.

Scott Bryan: Exits are nice. But I think the north star there has to be beyond the transaction. And does the buyer actually turn that solution into something that. They’re scaling across their platform And that they’re really selling it. And building the business. So that’s, on the exit side, but as an organization, look, we’re not here to find a silver bullet.

We’re really here to. Kind of find millions of acts that people and businesses can take to ensure a more sustainable future when it comes to water. So that’s not always thinking big and centralized. It’s thinking small. It’s thinking about affordability. It’s thinking about jobs. It’s really looking at the big picture and how do we make these solutions last and not be something that everyone gets excited about.

And then three years later, it’s gone!

Antoine Walter: And really a tricky question to, to close that deep dive. If I’m asking you, your favorite child among these 168 companies in portfolio, what is your preferred.

Scott Bryan: We like them all. We like most of them. But no, I, again just have a really fun time in Singapore working with some of our insurers there a few weeks ago. I think Mohammed sheriff Hartman from hydro leaf is somebody that I just get really excited about as a founder amazing personal story, but an impressive wastewater treatment business.

That’s working with industry in Southeast Asia. I think about someone like Bessie shorts that cloud the street he’s really. They of helping the insurance sector think about risk and flood management in a very informed way. Greg knew bloom from membrane would be another one. Yeah.

He’s in the membrane space, but I think Interesting take on it. We’re often cautious about getting of working in that space, but it’s a kind of founder like him. That’s got a novel technology and solution, but as also thinking I think really. Creatively about the story around decarbonization and what water innovation can mean.

So maybe those are just three entrepreneurs that have been on my mind a lot lately. But I think that as a collective I’m really been hopeful about where we’re seeing them think about decarbonization in the water sector. And how do we solve climate through water solutions?

Antoine Walter: I think your answer is revealing. asked you Which company is your favorite one and you answered with three entrepreneurs. So what matters is really the entrepreneurs more than the tech the vertical or whatever. It’s three that, those, I mean, people have changed a word, not.

Scott Bryan: Yes, definitely. I mean, I think there’s some technologies that we’ve identified and supportive and yes, there’s a good founder, but you also say, gosh, if this worked, this could be big. But more often than not.

we’re thinking about, Hey, is this is this someone that has a real eye for a beachhead?

And has a believable, incredible story. That’s ultimately going to attract the team the capital and the customers to scale. And without that center person, that will be hard to do.

Antoine Walter: Scott. It was a fascinating dive on the sit, on the surface of what you do with Imagine H2O. And there would be much more to, to uncover and to unveil, but I think for a first pass, that was where this is really fascinating from my end. I propose you to run it off and to switch to the rapid fire questions.

Scott Bryan: The tough ones!

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Rapid fire questions:

Antoine Walter: Actually there’s one. We’re really looking for your answer, but let me start with the first one. What is the most exciting project you’ve been working on, and why?

Scott Bryan: I again, I would point to this growing expertise and capability on the pilot funding side in both our urban water challenge and the w tap partnership with the world bank are both examples of where we’re just, we’re going beyond of helping the entrepreneur. Build their business, but to really make an impact in the markets that need innovation the most.

So when we think about expanding access to innovation, I think pilot funding and our role there plays a really exciting role.

Antoine Walter: Can you name one thing that you’ve learned the hard way?

Scott Bryan: One thing that we’ve learned the hard way I think that. I think it’s, it took us longer to build the organization early on than we realized and building a track record in this space because in a way?

look there accelerators weren’t commonplace in any sector at the time. That certainly they were starting to take. Shaped faster in the tech space and other parts of Silicon valley.

But I think it was hard for us to be in Silicon valley, looking around us and seeing have rapid growth in other spaces and wondering, well, why isn’t this happening faster? So I think that was a tough lesson early on. I’d love to be acting in and thinking bigger and faster in the future. But I also think that we bring that sense of reality , that we all need in the space.

Antoine Walter: Curiosity. Who was your company? Number one.

Scott Bryan: Ooh that first year or two companies that we really helped. One was fruition sciences, which was working with vineyards. And they had a SAP flow sensors that were deployed being deployed in vineyards and both California, France and Chile. Use less water make better wine. That was their value proposition.

So that was a fun one to work with. And then water smart software was an early one from that first year where, really thinking about what are the service-based offerings in this space of, what can what’s been done successfully in energy and how can that be applied to water? I think that was one of the lessons and, exciting pieces of that first.

Antoine Walter: So sorry for the sidetrack. I was curious,

Scott Bryan: Ah, sir,

Antoine Walter: is there something you’re doing in your job today that you will not be doing in

Scott Bryan: I think we will be doing less education of the market to outsiders. I think we get a lot of potential partners, whether they be from philanthropy or corporate saying, tell us about. Water solutions and why we need to care. I think there’ll be less of that. I think there’ll be more urgency and greater clarity around what’s actually needed to solve these things.

And I think, again, that evolution on our side more towards actually funding pilots as is a piece of that, that we’ll be doing more of.

Antoine Walter: What is the trend to watch out for in.

Scott Bryan: Maybe more of a cautionary one. I, I think that we’ve been really excited about water as a service, and then he had a service-based models. I think that COVID has driven an important transition in.

that mindset. But I think again, we need to be realistic about the limits here and the truth is that we’re not seeing a lot of municipalities.

Going into service-based contracts with startups. Although we talk about that happening. I also think investors are cautious because, they would rather see an outright sale or some investors would on the other hand, corporates are, yeah, they’re going to always want to keep things off their balance sheets.

So they, I think there’s competing interests and we need to be realistic with entrepreneurs and the sector about what this means. I think longterm definitely. That’s where we’re going. But the pace and the steps that are required to get there. That’s where I think there needs to be a real open conversation and analysis of when and how we’re going to get there.

Antoine Walter: If you were a word political leader, what would be your very first action to influence the fate of the world’s water challenges?

Scott Bryan: I think it’s so many ways our water challenges are often a crisis in governance. So, I think we really got to do a lot to. Clarify policies And in other cases, enact new policies. And I think I’m hopeful though, in the sense that water can be a convener and certainly in this country where we’re very politically divided.

And I look around the, the Rocky mountain west, for example, I think that you can see some people coming together. Both sides of the aisle around this issue of wash water scarcity, and long-term risk to economies and in ways of life. So I think that it’s going to get harder, but I’m optimistic about what’s possible from a policy standpoint, but certainly it’s going to take some leadership and some different models and thinking than what we’re, we’ve been here.

Antoine Walter: And finally last question. Would you have someone to recommend me that they should definitely invite on that microphone?

Scott Bryan: Well, I think Greg Bessey and Mo as I just mentioned,

Antoine Walter: I wouldn’t have guessed.

Scott Bryan: From our they just come to mind because they’ve been top of mind here recently, but happy to walk through the Imagine H2O show portfolio and see if there’s some other great entrepreneurs and thinkers and really leaders that should be on this panel.

Antoine Walter: Well, Scott, it’s been a pleasure if people want to follow up with you, where should I redirect them? The.

Scott Bryan: Imagine H2O dot Org is where it all lives. So please come there. If you’re a startup, you can register if you’re an investor or a tech adopter, that’s interested in connecting with our startups, you can do that. And if you’re a corporate or a philanthropy, we certainly welcome a conversation with you.

Antoine Walter: Thanks for your openness. Thanks a lot for everything you’ve shared today and thanks for the recommendation. But. I would love to recommend yourself again, but to go deeper into that matter. But it was really a pleasure to discuss with you and yeah. Thanks a lot.

Scott Bryan: All right. Thank you for having me and yeah. Look forward to being on again.

Other Episodes:

FREDsense: Revolutionizing Water Quality Monitoring with Biosensor Innovation

By Antoine Walter | 7 May 2025

Swirltex: Revolutionizing Wastewater Treatment with Bubbly Innovation

By Antoine Walter | 30 April 2025

Blue Foot Membranes: The Next Evolution in Water Filtration

By Antoine Walter | 16 April 2025

Echo River Capital: Pioneering the Future of Water Innovation

By Antoine Walter | 3 April 2025

1001 Fontaines: Engineering Sustainable Water Access Through Social Entrepreneurship

By Antoine Walter | 22 March 2025

Amazon’s Water Footprint: Tech Giant’s Quest for Water Sustainability

By Antoine Walter | 19 March 2025

Turing: The AI Revolution Quenching the Water Industry’s Thirst for Innovation

By Antoine Walter | 26 February 2025

Altillion: Pioneering Digital Intelligence for Water Asset Management

By Antoine Walter | 6 February 2025

Flocean: Pioneering Ocean-Based Water Solutions

By Antoine Walter | 15 January 2025

Botanical Water Technologies: Harvesting Liquid Gold from Plants

By Antoine Walter | 4 December 2024

The post How to Build the World Leading Water Innovation Accelerator: Imagine H2O appeared first on (don't) Waste Water.

Why and How? Let’s review!

with John Robinson – Partner & Co-Founder at Mazarine Ventures

Mazarine is an impact investor backing young technology companies with innovations that address some aspects of water risk, including quality and quantity.