Pure Energy Minerals shares surged on Friday as it said the plant was expected to begin operations before year-end.
Project partner Schlumberger New Energy said its new venture, NeoLith Energy, would use a differentiated direct lithium extraction (DLE) process to enable the production of high-purity, battery-grade lithium material while reducing the production time from over a year to weeks.
Schlumberger had struck an earn-in agreement with Pure Energy in 2019 to develop Clayton Valley, as the oilfields services giant's first foray into the lithium sector.
"We are accelerating the deployment of our pilot plant in response to the high market demand for battery-grade lithium material," Schlumberger New Energy executive vice president Ashok Belani said.
Lithium carbonate prices within China were approaching a 100% increase year to date, Benchmark Mineral Intelligence said this month, while Volkswagen last week provided no detail on lithium sourcing plans as it unveiled its ambitions in the battery space.
The plant would use an environmentally friendly method for subsurface brine extraction and lithium production which required a significantly smaller footprint and reduced water consumption by over 85% compared with current methods for lithium extraction from brine, Schlumberger said.
It had invested about US$15 million in the DLE process and expected the pilot plant to cost a similar amount.
"We welcome the progress towards this leading-edge development which will benefit Pure Energy's Clayton Valley brine project and potentially other projects in Nevada," Pure Energy director Mary Little said.
Pure Energy said it had been granted a finite term water right in 2019, to extract up to 50 acre-feet of water during a five-year period from Clayton Valley, which it said was deemed sufficient for brine testing requirements and the pilot plant facility.
Its shares (TSXV: PE) have spanned C18c-$2.63 over the past year and jumped 27% yesterday to $1.55, valuing it at $50 million (US$40 million).