How to Invest in the Salton Sea Lithium Opportunity

The Salton Sea region in Southern California is a significant potential source of domestic lithium, a metal crucial for batteries in electric vehicles (EVs) and renewable energy storage. The increasing global demand for lithium highlights the need for diversified and sustainable supply chains. This area’s unique geological characteristics allow for lithium extraction from geothermal brines, a novel and potentially more environmentally sound method than traditional mining.

The Salton Sea Geothermal Lithium Opportunity

The Salton Sea Known Geothermal Resource Area (KGRA) is located at the southern end of the Salton Sea and contains one of the world’s highest concentrations of lithium in geothermal brine. This geological setting, often referred to as “Lithium Valley,” holds an estimated 15 to 18 million metric tons of lithium reserves. This resource could meet a significant portion of U.S. lithium needs and contribute to global supply for decades.

Lithium extraction from these geothermal brines utilizes Direct Lithium Extraction (DLE) technology. This process involves pumping hot brine from underground reservoirs, extracting the lithium using specialized methods like selective adsorption or ion exchange, and then reinjecting the processed brine back into the Earth. DLE’s integration with existing geothermal power plants is a key advantage, as the brine’s heat first generates renewable electricity.

This method offers several benefits over traditional lithium extraction techniques, such as hard rock mining or evaporation ponds. DLE reduces the environmental footprint, requiring minimal new land disturbance and less freshwater usage—up to 90% less water compared to evaporation ponds. Integrating DLE with geothermal energy production results in a lower carbon footprint, and the closed-loop system minimizes waste. This approach provides a more sustainable and efficient pathway for domestic lithium production.

Key Companies and Development Projects

Several companies are actively pursuing lithium extraction projects in the Salton Sea region, each with distinct approaches and stages of development. These efforts aim to establish a robust domestic lithium supply chain.

Berkshire Hathaway Energy (BHE Renewables) operates ten geothermal power plants in the Salton Sea area. BHE Renewables is developing a lithium carbonate pilot plant, integrating lithium extraction with existing geothermal operations. Their involvement leverages established infrastructure to demonstrate DLE’s commercial viability on a larger scale.

Controlled Thermal Resources (CTR) is developing the Hell’s Kitchen Lithium and Power Development project, with a leasehold in the northern Known Geothermal Resource Area. CTR’s project aims to produce both geothermal power and battery-grade lithium hydroxide and carbonate. They plan substantial annual lithium production and have secured strategic partnerships, including an agreement with General Motors to supply lithium for EV batteries.

EnergySource Minerals (ESM) is advancing its Project ATLiS to construct and operate a commercial lithium hydroxide production plant. This facility will process geothermal brine from the adjacent Hudson Ranch Power I Geothermal Plant, also producing manganese and zinc products alongside lithium. ESM utilizes its patented ILiAD platform for efficient lithium extraction, designed to connect to existing geothermal power facilities. Project ATLiS is anticipated to begin operations in 2025 with a binding supply contract with Ford Motor Company, projecting an annual output of approximately 20,000 metric tons of lithium.

Investment Avenues for Salton Sea Lithium

Individual investors can gain exposure to the Salton Sea lithium opportunity through several avenues. The most direct method is investing in publicly traded companies developing projects in the region. This entails purchasing shares through a brokerage account. Investors can research companies mentioned in industry news or financial reports, then buy shares using their stock ticker symbols on major exchanges.

Indirect investment vehicles, such as Exchange Traded Funds (ETFs) or mutual funds, offer another way to gain exposure. These funds often hold diversified portfolios of companies in battery metals, critical minerals, or clean energy sectors. Some may include companies with Salton Sea lithium interests. Investors can search for ETFs or mutual funds aligned with lithium, battery technology, or renewable energy themes, often found under categories like “lithium ETFs,” “battery metals ETFs,” or “clean energy ETFs.”

When considering these funds, review their prospectus or fact sheet to understand their investment strategy and underlying holdings. This review helps determine if the fund provides desired exposure to the Salton Sea region or related lithium production. While direct stock purchases offer targeted exposure, ETFs and mutual funds provide diversification, potentially reducing individual company risk. The choice between direct and indirect investment depends on an investor’s preference for targeted exposure versus broader market participation.

Factors Influencing Salton Sea Lithium Investments

Investments in Salton Sea lithium projects are shaped by broader economic, technological, and regulatory considerations. Global lithium demand continues to expand, driven by increasing adoption of electric vehicles and grid-scale energy storage solutions. This sustained demand supports the long-term viability of lithium projects, including those in the Salton Sea. Projections indicate a substantial increase in demand over the coming years, reinforcing the market for new lithium supplies.

Technological advancements in Direct Lithium Extraction (DLE) are influential. Ongoing research and development improve DLE process efficiency, selectivity, and cost-effectiveness. These improvements can accelerate project timelines and enhance profitability by increasing lithium recovery and reducing operational expenses. Successful pilot projects and scaled DLE technology indicate the overall feasibility of Salton Sea operations.

The regulatory environment, particularly in California, plays a role. Permitting processes, environmental regulations, and water management policies can impact project development timelines and costs. While DLE offers environmental advantages, adherence to local and state requirements, including water use and waste management, remains a consideration. Infrastructure development, like access to power and water, is important for efficient facility operation.

Project development and commercialization timelines, spanning several years from initial exploration to full-scale production, impact investor returns. This extended period is typical for large-scale industrial projects and a consideration in resource investments.