The Tonopah Flats site is estimated to have one of the largest lithium deposits in the world, says American Battery Technology Co.

Jason Hidalgo, Reno Gazette Journal

Looking southwest toward Big Smoky Valley from Mt. Jefferson in Central Nevada.
Looking southwest toward Big Smoky Valley from Mt. Jefferson in Central Nevada. Benjamin Spillman/RGJ

A site in Nevada’s Big Smoky Valley holds even more lithium than initially estimated, according to an initial assessment of the location.

Potential lithium yields for the Tonopah Flats Lithium Project were revised upward to 18.03 lithium tons — above the 15.8 million tons of lithium carbonate equivalent from initial estimates by American Battery Technology Co. 

Battery materials company ABTC holds the mining rights for the site, which would be one of the largest lithium deposits in the world if the estimates hold up.

The positive assessment is good news for ABTC, which has seen its stock plunge from a high of $58.87 per share in early 2021 to $4.23 as of Jan. 3 as investors cooled on the company.

Ryan Melsert, CEO of ABTC, saw the assessment results as a positive indicator of the company’s future.

Melsert noted ongoing efforts to source key materials such as lithium within the United States.

“There is extremely large demand for U.S.-based battery grade lithium products, especially in the hydroxide form that can enable the manufacturing of high energy density cathode materials,” Melsert said. 

“Enhanced by the support of our U.S. Department of Energy grants, the economics of this project are very compelling and result in a full project payback period of only 2.4 years.” 

The domestic push for lithium in the United States

As the demand grows for batteries to power a host of technologies from smartphones to vehicles, the federal government is eyeing lithium not just as an economic opportunity but a security issue as well.

Lithium is just one component of a push to source and manufacture more high-tech components in the United States.

Lockdowns in China during the COVID pandemic, for example, showed just how reliant U.S. supply chains are to the country. Fears about China potentially attacking Taiwan — which manufactures more than 90% of the world’s advanced microchips — are also further exacerbating concerns about access to technology.

In August 2022, President Joe Biden signed the CHIPS and Science Act, investing nearly $53 billion in semiconductor manufacturing, research and development in the United States.

Meanwhile, the Department of Energy has been using grants, loans and other funding to help develop a domestic closed loop for batteries. The loop includes the mining of materials such as lithium in the U.S., manufacturing the batteries domestically, and recycling older batteries in the U.S. as well.

Examples of companies involved in the loop are Tesla, which manufactures batteries in partnership with Panasonic at its Nevada Gigafactory. Redwood Materials, a battery materials and recycling company founded by former Tesla executive JB Straubel, also received a $2 billion DOE loan last year.

One more company who wants to be part of the loop is ABTC.

Companies bank on lithium’s financial potential but also see pushback

With Biden naming Nevada’s Loop Tech Hub or “lithium loop” as one of 31 federally recognized tech hub regions in the country, the added investment from the designation is seen as an opportunity by companies such as ABTC.

ABTC has already received grants from the DOE, including a $10 million grant last year.

In its latest assessment, ABTC estimated a project life of 50 years for Tonopah Flats, which could potentially be extended even longer.

During those 50 years, ABTC expects operating costs to total $9.8 billion and revenue to reach $50 billion.

Even before the revised estimates for the Tonopah Flats site, it was already on pace to be one of the largest lithium deposits in the world. At a little over 18 million tons, Tonopah Flats would eclipse the previous high of 10.2 million from Bolivia’s Salar de Uyuni

Tonopah Flats is still below one other Nevada site. Lithium Americas Corp.’s project at McDermitt Caldera near the Oregon border is estimated to have lithium deposits between 20 million to 40 million tons.

Despite lithium projects being considered as great financial opportunities by their supporters, they have also seen strong opposition from critics. 

Lithium Americas experienced strong pushback for its project from Native American tribes who consider Thacker Pass at the southern end of the caldera to be a sacred site.

Another Nevada site, Ioneer’s Rhyolite Ridge project, was the subject of a legal battle after conservationists raised concerns about its impact on an endangered wildflower known as Tiehm’s buckwheat.

The Center for Biological Diversity and the U.S. Fish and Wildlife Service settled their case over the project last year.

Published by Reno Gazette Journal