Q&A on exploring Cornwall’s lithium-bearing brines
Natalie Daniels speaks to Jeremy Wrathall FIMMM about his plans to explore Cornwall’s lithium-bearing brines.
Tell me about your background and career to date.
I trained as a mining engineer at Camborne School of Mines, UK, and then worked in the South African gold mining industry. I went on to become a mining analyst and progressed to run a global mining team.
What has been your biggest career highlight?
There have been a number to date including financing mines all over the world. But, for me, the most exciting thing is the opportunity to develop lithium-bearing brines, which we have identified in Cornwall. We believe this holds true transformational potential to establish a new industry in the UK, if it is successful. My company, Cornish Lithium Ltd, has secured rights to explore and develop these lithium-bearing brines over a large area.
You trained as a mining engineer and have gone on to work in corporate roles. What was the reason for this?
Over the time I spent in mining finance I have accumulated many of the skills needed to build my own mining company. My background in finance, mining engineering and geology enabled me to recognise the opportunity that lithium-bearing brines in Cornwall now represent. Advances in geophysics, drilling and processing mean that such brines may be commercially developed, whereas they were formerly just a geological curiosity. To have the opportunity to lock up such a large area for exploration, I believe, is a historic achievement and gives us the ability to explore Cornwall for lithium-bearing brines using modern geophysical techniques not previously applied in Cornwall before. Now that we have secured the mineral rights agreement, we hope to move forward with a detailed exploration programme, followed by drilling of prospective targets.
What does your work at Investec involve?
We are currently researching and commenting on global trends within the mining industry. We recently conducted a report on the electric car and the effects on the mining industry.
What are your plans for exploring Cornish lithium?
The Cornish lithium project started with the recognition that lithium-bearing brines occur across a wide area of Cornwall, focused on the historic mining areas between Camborne and St Day. We started putting together records of occurrences of lithium-bearing brine in mines that historically operated in Cornwall and it led me to realise the significance of this, given the rapidly developing market for lithium. We have now secured minerals rights from the various owners in the area of focus to explore the potential for lithium. As a result, we have commenced raising the necessary capital to start our detailed exploration programme, up to £5 million, and assemble the team. We will then need to spend around six months compiling all the geological data to accurately pinpoint where to conduct further geophysical surveys and identify water-bearing structures in Cornwall. We believe the large fault structures that run right across the county are carrying saline fluids containing lithium and we aim to use various geophysical techniques to identify exactly where to position our testing drillholes. From there, we can drill down to collect samples of the brine for further evaluation.
Will this lithium be hard to extract?
This project isn't really a mining project as we expect the brine to be extracted using drillholes, similar in nature to a geothermal hole. This is an extremely environmentally friendly way of extracting the minerals – historic records show that these brines carry heat, which we also hope to recover. When it gets to the surface, it can be piped into a processing plant, which has a relatively low footprint. Such a plant would extract the lithium using either membrane technology or a modified SX/EW process. There are a number of new techniques to extract lithium from brine. Technology is advancing fast, but there is a popular misconception that the only way of extracting lithium from brines is to use the evaporation process, which is used in Chile and Argentina. That is no longer the case as far as we can see, given the rapid developments that seem capable of extracting lithium at a greater speed.
How much can you expect to mine?
It is too early to say. We do have historical records of flow rates and the grade of lithium contained in these brines, but we don't know the economics as of yet.
What are some of the difficulties you face extracting lithium from Cornwall?
The main difficulties will be identifying the best place to drill and the best means of extraction. We will conduct a full study into all of the available options. I think our challenges will be no different from those that any other mining project may encounter such as looking at whether the grade is sufficient, the extraction process and permitting. This project is absolutely no different to any early stage exploration project, apart from the fact that the potential in Cornwall has only just been recognised – it is a new metal in an old mining area. In the past, there has been scepticism about the revival of mining in Cornwall. In my view, this does not take into account the many new mining technologies that have been developed since the closure of the South Crofty mine. In the last 100 years, Cornwall has not really benefitted from many modern exploration techniques, which is a shame. We hope to change that.
Where specifically will you be exploring in Cornwall?
Between South Crofty and Wheal Jane is the primary area of focus. It is interesting to note that many of the former mines in this area closed down partly because of the amount of hot upwelling water that they encountered. We now believe that it is this very water that contains the lithium. If we can remove that problem or process that water to extract lithium, then who knows what else could happen to the mining industry in Cornwall. It is entirely possible that our exploration efforts may discover new deposits that could then be commercially developed. There are also plans underway in Cornwall to build deep geothermal wells and one of those will be sited in the area we are exploring, so we hope to work with that company going forward to forge new relationships and exchange new data and knowledge.
Does this exploration effort represent a broader opportunity for the UK? How do these deposits compare with other lithium deposits that are being exploited?
It is too early to say. The grades are lower than those found in Chile but the overall chemistry might prove beneficial. Chile has just instigated a new royalty regime for new mines, which comes into force with lithium carbonate prices at more than US$10,000 a tonne. Given such developments, I suspect that people may think twice about making new investments in Chile. Admittedly, it is very early days for our project, but if we do manage to successfully extract lithium from these large fault structures, then it is possible that this could provide the foundations of a new industry in the county.
Do you see the demand in lithium continuing?
Absolutely – there is no doubt in my mind about that. The demand for electric cars is growing rapidly. Tesla is launching a new model and Volkswagen also plans to make 25% of its carselectric by 2025. By 2035, I suspect a significant amount of car sales will be electric, possibly as much as 50%, and that will drive demand for lithium hydroxide and carbonate much higher. Currently, the global output is estimated at approximately 190,000 tonnes per annum and that simply is not enough to cope with demand. We believe that this trend is going to continue and will change the dynamic of the industry for good. Lithium prices have tripled in the past 18 months, which is testament to the enormous change that is happening right now.
Jeremy Wrathall FIMMM is CEO of Cornish Lithium Ltd as well as mining team leader responsible for strategy and marketing at Investec. He started his career working underground in the gold mines of South Africa and moved back to the UK to pursue a career as an analyst covering mining equities globally. He formerly led the global mining research and sales teams at UBS and Deutsche Bank and has worked on transactions across mining exchanges worldwide.