As the world moves to secure lithium for electric vehicles and other power-hungry products, Alberta is advancing an approach that could offer both environmental and strategic advantages.

A new assessment of Alberta’s lithium resources confirms the enormous scale of the province’s potential.

A new approach to lithium production

Rather than relying on sprawling solar evaporation ponds or energy-intensive hard-rock mining operations, Alberta is pursuing lithium production centred on direct lithium extraction (DLE) from deep underground deposits. 

Using technology adapted from decades of oil and gas experience, DLE uses solvents to selectively remove lithium from salty formation water before reinjecting the spent brine back underground, significantly reducing land disturbance and water loss.

Work underway in the province is showing the feasibility of lithium production from DLE.

“We have a great resource base, and our oil and gas industry has set us up to pursue a more environmentally friendly way of producing lithium,” said Kim Mohler, vice-president of project development for energy consulting firm GLJ Ltd. 

Much of Mohler’s time is spent supporting clients’ lithium and geothermal projects across Canada and the U.S., including key DLE developments underway in Alberta.

“Alberta has an advantage because a lot of the knowledge and infrastructure for drilling wells and producing deep subsurface brines is already in place,” she said. 

The province is also a step ahead because the exploration work that has to be done in other parts of the world has already been done here, Mohler added.

One of the world’s largest lithium resources

According to a new report by the Alberta Geological Survey and Alberta Energy Regulator, the province’s subsurface contains an estimated 82.5 million tonnes of lithium carbonate equivalent, one of the largest known accumulations in the world. 

Most of the resource is concentrated in the Devonian-age Leduc formation, the same geologic formation that launched the province’s modern oil industry in 1947. 

Significant additional resources are also found in the Swan Hills and Nisku formations.

Source: Alberta Geological Survey/Alberta Energy Regulator

The new report outlines the enormous scale of the lithium industry’s opportunity. 

Alberta’s lithium resources could supply material for more than 10 billion electric vehicle battery packs and could theoretically generate more than US$1 trillion in revenue over time, the analysis found. 

Rising demand, limited North American supply

North American lithium demand is projected to grow sharply over the next several years. 

According to S&P Global, U.S. consumption is forecast to increase by roughly 74 per cent annually while Canadian demand grows by about 40 per cent by the end of the decade. 

Right now the vast majority of the world’s lithium supply comes from outside of North America, which produced just 40,000 tonnes of lithium carbonate out of a global supply of 1.28 million tonnes in 2024. 

Canada accounted for approximately 2.5 per cent of that, at 5,983 tonnes, according to the Canada Energy Regulator.

Alberta emerging as a new lithium player

As global demand for lithium accelerates, driven by rapid growth in electric vehicles and battery storage, Alberta is emerging as a new player in a market long dominated by countries such as Chile, Argentina and Australia. 

Approximately two million hectares have already been leased for lithium exploration in Alberta, and the province is a hot spot in the nascent DLE industry.

The E3 Lithium pilot plant near Olds, Alta., September 2023. CP Images photo

E3 Lithium is the province’s most advanced lithium developer. 

The Calgary-based company produced Alberta’s first battery-grade lithium carbonate at its demonstration facility near Olds in 2025. 

The milestone marked a major step toward commercial production and validated the technical feasibility of extracting lithium from Alberta brines. 

Path to commercialization

E3’s project leverages Alberta-based DLE technology and existing oilfield infrastructure, and the company is working toward commercial-scale production later this decade.

“Nobody has proven they can do DLE production at commercial scale yet,” Mohler said. 

“The potential for Alberta to be among the first is very good if they can make the economics work, and I think following the oil and gas industry’s value chain of having companies specialize in upstream production, transportation, processing and refining will likely be a good business strategy.”

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Emerging energy resources are taking on greater importance in Canada’s oil and gas heartland.  

Producers will spend $730 million this year developing hydrogen, geothermal, lithium and helium resources, according to the Alberta Energy Regulator (AER).  

That’s a nearly 250 per cent increase from 2020, and it’s expected to continue rising.  

“We have advantages in all four categories,” says AER principal economist Afshin Honarvar. “They are important.”  

The AER first included emerging resources in its annual outlook in 2022, listing capital expenditures for hydrogen, geothermal and helium alongside oil, gas and oil sands. This year the AER added lithium to the outlook as well.  

Annual spending on emerging resources in Alberta is projected to reach $840 million in 2032, or a total of about $9 billion between 2020 and 2032. 

“It makes sense for us as the regulator to use our expertise in economics as well as the data that we have to track the progress in these areas,” Honarvar says.  

“That is interesting for people to know. Provincially, nationally and globally this is something they are interested in, and they would like to see how we are progressing.” 

The AER’s spending projection is based on public project announcements and estimated capacity additions, the regulator said.  

The temporary pause on renewable electricity generation projects reviews and approvals that applies to the Alberta Utilities Commission does not apply to regulatory approvals from the AER, a spokesperson told CEC. 

Hydrogen 

Hydrogen is the most advanced of Alberta’s emerging resources. The province is already Canada’s largest hydrogen producer, generating about 2.5 million tonnes of the country’s three million tonnes per year of the resource, mainly used for industrial processes.  

Alberta is also already producing so-called “blue hydrogen” from natural gas, where emissions are removed through carbon capture and storage (CCS) technology. Since 2015, the Quest project near Edmonton has safely captured and stored more than 7 million tonnes of CO2 emissions while producing clean hydrogen for the Scotford oil sands facility. 

Among new hydrogen projects underway in Alberta is a $1.6 billion net zero complex owned by Air Products. It will provide supply to the province’s first commercial-scale hydrogen refueling station, as well as Imperial Oil’s new renewable diesel facility.  

Honarvar says Alberta’s advantage as a hydrogen producer for future fuels comes from its vast resources of natural gas, and the energy industry’s experience. 

“We have the right skill set; we have the right infrastructure. We have the human resources, with the knowledge that can be transferable in this area very easily,” he says.  

“Geothermal is no different.”  

Geothermal 

Geothermal energy, or heat originating from below the earth’s surface, can be produced using water or other fluids and used for heating or generating clean electricity.  

Geothermal is relatively untapped in Alberta, but AER data shows development is accelerating.   

“We forecast an average growth rate of 13 per cent in our outlook. The base is small, but the pace of growth is fast,” Honarvar says.  

“Geothermal is about repurposing existing oil and gas wells. We have produced from oil and gas wells for many years. We are very familiar with that technology, and we have the knowledge of how to utilize that kind of resource.” 

Lithium 

Alberta’s long-established oil and gas sector also provides advantages for lithium production, Honarvar says. In Alberta, lithium – an ultra-light metal used in consumer electronics as well as electric vehicles and battery storage systems – is found in so-called brine.  

“Brine is basically the water that gets produced with oil and gas.  We have been dealing with brine for many, many years, but in the past we were not using it, we were injecting it back into the ground,” he says.  

“Now the plan is to extract the lithium that is available in those brines. The price of lithium has increased a lot over the past few years and that has created that window of opportunity for Alberta because some of those marginal resources now they are becoming a gold mine.” 

Helium 

Helium, which has many uses including medical MRI imaging and as a rocket propulsion fuel, is in short supply around the world.   

The price of helium has increased by more than 160 per cent since 2017 as demand has grown and is expected to continue rising. Canada has the world’s fifth largest helium resources, and because it can be produced along with natural gas, Alberta could become a significant supplier.  

“In the past helium was mainly maybe a waste because it was not really captured or processed. Now if we find a good concentration of helium, the plan is to extract and process that helium,” Honarvar says.  

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Canada’s post-pandemic economy is like a cross-country horse race. Out front, galloping through the canyons of inflation, geopolitical instability, and supply chain problems are oil and gas, retail, transportation, manufacturing, agriculture and tourism to name a few industries. Gaining momentum is energy cleantech.  

Chris Doornbos, CEO and founder of Calgary’s E3 Lithium is helping lead the charge in Canada’s nascent lithium sector. The geologist and his team are at the forefront of Canada’s uptick in lithium exploration, which could help secure future economies as the world moves to reduce CO2 emissions.  

Lithium, or white gold, is found in minute quantities in the Earth’s crust. It’s essential in lithium-ion batteries, which are used in electric vehicles and mobile phones.

Using its direct lithium extraction (DLE) technology, E3 is focused on liquid brines harvested from aquifers in the Western Canadian Sedimentary Basin – noted for vast oil and gas reserves. The company hopes for commercial production in 2026 from its inferred mineral resource of 23.4 million tonnes of lithium carbonate equivalent. 

“In my mind, western Canada is going to be one of the biggest jurisdictions for lithium on the planet,” said Doornbos.  

Fortified by a $27-million investment from the Government of Canada’s Innovation, Science and Economic Development’s Strategic Innovation Fund, E3 is collaborating with Imperial Oil to advance an initial lithium pilot project in Alberta.  

The pilot project, anticipated in 2023, will extract lithium from the historic Leduc aquifer using DLE technology. E3’s proprietary technology removes lithium from brines, producing a concentrated product that can be converted into battery-grade material. The company completed drilling its first test well in July and now owns three wells in total. 

E3 Lithium brine production well. Photo courtesy of E3 Lithium.

“This exciting collaboration brings together Imperial’s long-standing commitment to research and technology to help test and scale E3’s lithium-recovery technology,” said Jason Iwanika, Imperial’s director of commercial business development.  

Annual global electric vehicle production is set to grow from 3.4 million in 2020 to 12.7 million in 2024, says GlobalData, a data and analytics company. Battery production could grow from 95.3 gigawatt hours to 410.5 gigawatt hours over the same period. As a result, demand for lithium is expected to grow from 47.3 kilotonnes in 2020 to 117.4 kilotonnes in 2024 at a 25.5 per cent compound annual growth rate. 

With a large land package in Manitoba, Vancouver-based Foremost Lithium hopes to address global lithium demand by exploring for spodumene, the mineral associated with hard-rock lithium deposits. The company has lithium showings at surface and in drill holes and has conducted geophysics and soil sampling to determine drilling targets, said Mark Fedikow, a geologist and vice-president of exploration. 

Foremost Lithium geologist and VP exploration Mark Fedikow on site in Manitoba. Photo courtesy of Foremost Lithium.

“We are extremely busy exploring our 43,000 acres of tier one lithium exploration properties,” he said.

The company’s exploration area is near the historic mining community of Snow Lake. The region has an endowment of copper, zinc, and gold. There is an experienced workforce at Snow Lake and the local population understands and supports mining, said Fedikow. The region also has reliable helicopter and fixed-wing aircraft service. 

“We’ve been able to put crews on the ground from the local communities,” he said, noting Foremost was awarded a $300,000 Manitoba Mineral Development Fund grant to support exploration. 

“We look to them for support in other areas, too. We get our groceries there. We buy our fuel there. We are deeply involved with the Snow Lake community. We are very fortunate in that regard.” 

Foremost expects to carry out 3,000 metres of drilling this winter. The company is also exploring its Grass River, Zoro and Peg North properties in Manitoba. 

“We’ve managed to complete drone magnetic surveys on all our properties,” said Fedikow. “Eventually we will be drilling targets based on the results, also prospecting and rock and soil sampling. In the future we fully expect to be exploring our properties with more than one drilling rig.” 

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