Lithium: An energy source in the desert

September 10, 2009 12:26 PM PDT
Lithium: An energy source in the desert
by CBS Interactive staff 11 comments

Watch the video reportNothing grows in Chile's Salar de Atacama desert. It's the driest place on the planet, and one of the most remote. But to Tim McKenna, what's underground is paradise. He calls it, "the best place on earth."

McKenna's company produces lithium, the world's lightest metal. And lithium powers the batteries in the cell phones, BlackBerrys, and laptops that in turn power the world.

In Chile, the extraction process comes naturally: melting snow from the Andes Mountains runs into underground pools of salt water--or brine. That brine's pumped out. In a network of ponds, the desert sun evaporates out other salts, leaving lithium brine.

McKenna says, "the sun basically does all the work."

The brine's processed into white powder, lithium carbonate--a growing part of the world's energy future. Two companies, one American, one Chilean, produce half of the world's lithium in the salt basin in Chile.

As a source for battery power, demand for lithium is about to soar. This fall, Mercedes will sell the first lithium powered plug-in car. At least six more carmakers plan their own models. Chevy's new Volt is expected to get 230 mpg off of just one charge.

In your cell phone or BlackBerry battery, the lithium weighs one-tenth of an ounce. In a plug-in car, the battery's lithium weighs 20 pounds. In 10 years, lithium's price per pound has tripled to around $3, with only three major companies dominating the world's market in a half-dozen countries.

Chile, the largest supplier, has been called the "Saudi Arabia of lithium."

Energy analyst Ben Johnson said, "it looks very similar to an OPEC-style cartel. It's highly concentrated. The various producers are very secretive about their expansion plans and about their pricing movements."

Lithium producers deny that. Consumers will wait and see. But there's no denying, in the world's evolving energy science, lithium means power.

This story was written by Mark Strassman and originally posted at CBSNews.com