Copyright of the Daily Oil Bulletin 2018
Commercial Extraction Of Lithium From Oil And Gas Wastewater Set To Begin
By far, the largest volume product produced by the oil and gas industry is not oil and gas, but water — billions of barrels produced annually across North America that represents a cost rather than a revenue stream. But within that produced water is potential value, in heat and minerals such as titanium, magnesium and an increasing sought after substance for the electric car — lithium.
Extraction of that value could offer an added revenue stream that otherwise goes to waste, say two companies that have teamed up to provide low cost wastewater treatment while extracting lithium and potentially other minerals from produced water. Surging demand for lithium-ion batteries in particular, boosted by uptake from automakers, is expected to drive demand for lithium for several years.
Vancouver-based MGX Minerals Inc. and engineering partner PurLucid Treatment Solutions Inc. of Calgary rolled out their first three commercial-scale NFLi-5 rapid lithium extraction systems this week, destined for two SAGD operations in northern Alberta. The NFLi-5 has been teamed with customized PurLucid wastewater treatment systems unique to each client’s needs and capable of lithium, minerals, slop oil and heavy metals separation.
MGX holds the rights to the jointly developed lithium extraction technology, while PurLucid retains the rights to the pre-treatment nanoflotation water purification and core technology. MGX holds a 51 per cent interest in PurLucid and maintains the right to acquire 100 per cent through successive future investments.
“The goal [of the water treatment] is to remove the calcium, magnesium and silica — those create a real problem for the industry, particularly on the thermal side, in SAGD, because those foul up their process,” said Preston McEachern, PurLucid CEO and founder, in a tour of PurLucid’s laboratories in southeast Calgary.
“And as it turns out, in order to recover lithium, we also have to remove those components. So that was how the marriage actually started with MGX, was that we were providing this treatment system and MGX needed something like that to get rid of those ions and silica. When we started looking at their technology, we said we could redesign this and do it much more efficiently and much cheaper.
“The nice thing about it is, this can offset the cost of water treatment, so for the oil and gas industry who would otherwise have disposed of the water and acted in what would be a less sustainable manner, now they can say, the water treatment cost has come down enough, because of the lithium off take, that we are willing to treat the water rather than dispose of it.”
The first system is an evaporator blowdown wastewater treatment system (10 cubic metres per hour) that will take highly concentrated evaporator brine and treat it to a level suitable for reinjection on site. The second system, fabricated for a consortium of partners, is a high-temperature system that will be installed to treat produced water following oil-water separation.
The third system is a larger-scale version (35 cubic metres per hour) of the first system intended for deployment to treat once-through steam generator boiler blowdown. The goal is to create treated water suitable for reuse, saving the majority of water loss in most SAGD projects. The system will also reduce both the complexity and cost for new and expansion SAGD projects while demonstrating large-scale treatment capabilities suitable for other thermal and industrial wastewaters, the companies said.
PurLucid’s system uses a highly charged replaceable skin layer membrane, which replaces the flotation and clarification processes normally used for oil and silica removal, and a high intensity froth flotation system known as nanoflotation. The technology allows high temperature water treatment at 10-30 times the efficiency of existing ultrafiltration systems, with reduced energy demand, smaller footprints and lower capital costs, according to the company.
By eliminating the need for cooling, heat exchangers can be eliminated. The high temperature system will also be used to test a patent-pending combined power generation design. High temperature treatment with high efficiency filtration could reduce the water treatment component of greenhouse gas emissions per barrel of oil by 88 per cent, PurLucid estimates.
Sustainable Development Technology Canada and Emissions Reduction Alberta are funding some of the development of the technology, which was a 2017 finalist for the Most Disruptive Technology in the World award by Katerva. It is integral to the efficient processing of petrolithium brines for lithium recovery, said McEachern, who holds three faculty positions with Canadian universities and was vice-president of Research and Development at Tervita prior to forming PurLucid.
From months to hours
Unlike conventional lithium extraction processes, which require the construction of large, multi-phase, lake sized, lined evaporation ponds and up to 18 months of a solar evaporation phase, MGX’s recently developed lithium recovery process accomplishes the task in hours, producing a lithium chloride solution which is further upgraded to the lithium much in demand for lithium-ion batteries.
“The real magic of this is the proprietary absorbent, a molecular sieve that we have developed, that is very efficient compared to alternatives for lithium recovery. It is highly selective for lithium,” said McEachern.
Alberta oil and gas producers typically don’t have the high lithium scores to make lithium extraction of their water economic in its own right, he said. “What makes it particularly economic, and potentially very profitable, is that they need the water treatment function. They have huge volumes of water, mediocre to OK lithium scores in the water, but the fact that they need the water treatment piece, and they are willing to pay for that, offsets all of the costs, and in fact makes a decent profit. The lithium recovery is kind of an add on that’s an additional profit or revenue stream that they would have otherwise considered a waste.”
“We think of it as a continuum,” added Jared Lazerson, MGX president and CEO. “On one end you have the wastewater treatment and in some projects very high cost wastewater treatment, where oil and gas companies or industrial companies are paying a tremendous amount to have that water disposed of. Then on the other extreme you have what would be high concentrations of lithium or a scenario where there is a lot of lithium potential. So really what we look at in terms of projects is just overall profitability.
“We like to come into deals and say essentially, we will pay for everything and we will just do a per unit charge. Obviously your sales opportunities or your joint venture opportunities or your acquisition opportunities open up tremendously when you say, ‘you can drive a truck but we are going to pay for the gas,’ or something to that effect. So it doesn’t cost anything. You are essentially providing us with the lithium and in return we are cleaning the water. Business-wise it is a hybrid model, and in some models it’s just all [about] lithium, and some models there is no lithium, it’s all wastewater cleanup, but the IP [intellectual property] is still essentially the same.”
It presents an opportunity for diversification in the oil and gas sector, and an avenue to move into the rapidly growing renewable energy space, he added. “On a daily basis, the oil and gas companies are producing massive amounts of lithium feedstock. [Lithium] grades in Alberta tend to be on the lower side, but those extra dollars that can be generated from water treatment allow us to then move into the lithium space…. There is certainly plenty of lithium overall in terms of a resource in Alberta — massive amounts of lithium, massive amounts of water, but on a lower grade.
“By cutting wastewater treatment costs, that allows us to then open up the lithium, and then actually credit back the lithium to oil and gas, essentially putting the oil and gas companies into the lithium business, which is just a fantastic paradigm in and of itself — that you have the fossil fuel guys now essentially [moving] into the renewables space, and it all begins to tie everybody together.”
The fact the systems are modular and come with relatively low capital cost, and that they can leverage existing oil and gas infrastructure, will speed adoption, Lazerson said. “In oil and gas, the fact that that water is being pumped every day, regardless of whether we are extracting lithium or not, makes things a lot easier. Having many billions worth of infrastructure already in place makes it is a lot easier than if we had to drill all the wells ourselves.”
McEachern also anticipates quick uptake of the technology, which he said the industry is watching closely. “Nobody wants to be the first one to jump on board, so the two clients that these three systems are going to go out to, we are expecting that once they are deployed and operating, that everybody is going to want one, because it’s way cheaper than the alternative of disposal — less than half the price — so it’s a huge reduction in cost for them. Management of some of these blowdown waters, from the boilers and evaporators, are some of their highest costs.”