Direct Lithium Extraction Co. Sees Big Capacity, Time Improvements

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Volt Lithium Corp. (VLT:TSV; VLTLF:US; I2D:FSE) announced it has significantly improved the operating capacity of its next-generation Direct Lithium Extraction (DLE) technology for processing oilfield brines in Texas' Delaware Basin.

Volt said the installation of its Generation 3 equipment at its modular U.S. Field Unit has led to lithium-extraction cycle times of less than 30 minutes, representing a four times improvement in operating capabilities.

The improvements set the stage for "commercial production in the range of 5,000 to 10,000 barrels per day of brine production by the end of 2024," the company said in a release.

"We have successfully transitioned Generation 3 System from Volt’s Simulation Centre in Calgary to the field in Texas, paving the way for Volt to commence commercial operations by the end of 2024," said President and Chief Executive Officer Alex Wylie. "The success in the field to date will allow Volt and our strategic partner to significantly scale-up operations in 2025 and beyond."

Volt is poised to become one of North America's first commercial producers of lithium from oilfield brine by leveraging its DLE technology to achieve high lithium recoveries at low costs, positioning itself as a key player in the clean energy transition.

Advancements Prove Valuable in the Field

Volt said that as a result of technical advancements and optimization in its Generation 3 equipment, it has significantly improved its processing extraction time from oilfield brine to under 30 minutes while maintaining the technical standards of 99% lithium extraction.

In addition, most recent results in the field have demonstrated up to 75% lithium extraction rates within a 10-minute lithium extraction cycle time, the company said. The improved cycle times will allow Volt to significantly increase throughput capacity in its operations in Texas.

According to the company, it also will continue to "cost-effectively and efficiently scale-up further to process commercial levels of brine" by either adding modules to increase processing capacity, reducing lithium extraction time to increase volumes, and/or implementing larger extraction modules.

As Volt’s DLE process can successfully achieve rapid lithium extraction rates, the company said it can cost-effectively generate a high-quality eluate of lithium chloride (lithium chloride concentrate), as well as battery-grade lithium carbonate or battery-grade lithium hydroxide monohydrate.

Analyst Expects 'Steady Processing Capacity Increases'

In a recent report from 3L Capital, Volt's recent milestones, particularly the installation of its first field unit in the Permian Basin, were highlighted as key catalysts. The unit, with a processing capacity of 200,000 liters per day, marked a significant scale-up, doubling Volt's previous capabilities.

The report noted, "Volt anticipates they can generate US$16.8 million in annual operating cash flow at a lithium concentration of 31 mg/L (milligrams per liter) and lithium hydroxide price of US$20,000/(ton)."

At a full production run rate of 100,000 barrels per day, 3L Capital estimated Volt's potential valuation could reach US$178 million.

Additionally, the report emphasized that Volt's modular field unit design allows for cost-effective scaling. 3L Capital projected that Volt could achieve commercial production by 2025, stating, "We expect steady processing capacity increases over the next 12-18 months and the capital spend to be spread out."

Technical Analyst Clive Maund expressed a bullish outlook on Volt Lithium during a call with Streetwise Reports. 

Maund noted that the stock had "broken out of a base pattern of approximately a year's duration on strong volume," signaling a strong technical position. He added, "This is viewed as decidedly bullish and as a sign that it will start higher again soon and probably imminently," rating Volt an Immediate Buy based on its recent consolidation and technical indicators.

The Catalyst: Experts Point to Market Recovery

Lithium is critical in the energy transition for its use in batteries for electric vehicles (EVs) and other application and is also used in electronics, medicine, and other industries.

While prices have slumped this year after EV sales didn't hit predicted marks for sales, many experts believe the market will recover.

According to a report by Grand View Research, market size for the metal was estimated at US$31.75 billion last year and is projected to grow at a compound annual growth rate (CAGR) of 17.7% from this year through 2030.

"The automotive application segment is expected to witness substantial growth, driven by stringent regulations imposed by government bodies on ICE automakers to reduce carbon dioxide emissions from vehicles," researchers at Grand View said. "This has shifted the interest of automakers toward producing EVs, which is anticipated to benefit the demand for lithium and related products."

EVs and battery storage primarily will fuel future growth of the lithium market, Marin Katusa of Katusa Research wrote recently. He pointed out that all major electric vehicle batteries require lithium, about 1.55 pounds per kilowatt hour of battery capacity, on average.

"I think the data speaks for itself that there's more growth and opportunity on the horizon," Katusa wrote.

As Energy News reported in July 2024, the Inflation Reduction Act (IRA) also provided a significant financial boost to the lithium mining sector, with "the Department of Energy (DOE) Loan Programs Office" injecting "about US$11.7 billion to support new loans for energy projects, including mines for needed metals like lithium."

Ownership and Share Structure

Refinitiv provided a breakdown of the company's ownership and share structure, where management and insiders own approximately 14% of the company.

According to Refinitiv, James Alexander Wylie owns 7.97% of the company, Martin Scase owns 4.53%, Warner Uhl owns 0.81%, Morgan Tiernan owns 0.35%, and Kyle Robert Hookey owns 0.10%.

Refinitiv reports that institutions own less than 1% of the company, as Eagle Claw Investments Pty. Ltd. owns 0.98%.

According to Reuters, the company has 142.66 million shares outstanding and a market cap of CA$58.16 million. It trades in a 52-week range of CA$0.16 and CA$0.49.