In a bid to diversify their economies and capitalise on the growing demand for electric vehicles (EVs), national oil companies in Saudi Arabia and the United Arab Emirates (UAE) are planning to extract lithium from brine in their oilfields.
The move signals a strategic shift for oil-producing nations as they seek alternative sources of wealth amidst the global transition away from fossil fuels. Saudi Arabia, in particular, has invested significantly in positioning itself as a hub for EVs under the leadership of Crown Prince Mohammed bin Salman.
Sources revealed that Saudi Aramco and Abu Dhabi National Oil Company (ADNOC) are in the early stages of exploring lithium extraction from brine, which is considered a critical mineral due to its essential role in battery manufacturing for electric vehicles. However, specific details regarding the extraction technology were not disclosed, and both companies declined to comment on the matter.
Direct lithium extraction (DLE) technology, although in its infancy, presents advantages such as avoiding the environmental challenges associated with traditional mining methods. By filtering lithium from saltwater brine, Saudi Arabia and the UAE can leverage their expertise in handling oil brine and wastewater at oil production sites.
While the economics of DLE technology remain uncertain compared to oil, the absence of costly infrastructure like open pit mines or evaporation ponds presents a promising alternative for these oil-rich nations.
Despite current market challenges, including a slowdown in EV sales and a supply glut, leading carmakers are actively seeking new lithium sources in anticipation of future demand. Analysts anticipate continued reliance on lithium in the EV industry, despite ongoing research into alternative battery technologies.
Saudi Arabia’s robust financial position allows it to pursue diversification efforts with confidence, including establishing itself as a hub for EV production. The kingdom’s sovereign wealth fund, the Public Investment Fund (PIF), aims to produce 500,000 EVs annually by 2030, bolstered by initiatives such as the establishment of its own EV brand, Ceer, and the construction of an EV metals plant.
Furthermore, Saudi Arabian Mining Company (Ma’aden), the Gulf’s largest miner, is actively involved in extracting lithium from seawater. Saudi Vice Minister of Industry and Mineral Resources Khalid bin Saleh Al-Mudaifer affirmed the kingdom’s commitment to advancing research and investment in lithium extraction technologies, citing promising progress in collaboration with Ma’aden and Aramco.
As Saudi Arabia and the UAE embark on their journey to extract lithium from brine, they position themselves to play a significant role in meeting global demand for this critical mineral in the era of electric mobility.