Tetra

Tetra Technologies, Inc., will decide later this year if it can justify construction of a bromine extraction plant, possibly southeast of Lewisville.

If so, it will decide in 2023 whether to tack on a plant to extract lithium from the same brine pumped from underground fields in Lafayette and Columbia counties.

The Woodlands, TX-based company said in a statement that it is completed an estimate of bromine and lithium resources on its leased acreage in the two counties.

A technical report summary prepared by the company said the brine resource underlying the approximately 40,000 gross acres where it holds bromine mineral rights contains about 5.25 million short tonnes (4.763 million metric tons) of elemental bromine.

CLICK THE PDF below to see Tetra Technologies’ 158-page report to investors.

The brine resource underlying approximately 5,000 gross acres where Tetra holds lithium mineral rights that are not subject to a lithium option agreement with Standard Lithium, is estimated to contain an inferred resource of 44,000 short tonnes (40,000 metric tons) of elemental lithium.

Using a conversion factor of 5.323 to convert elemental lithium to lithium carbonate equivalent (LCE) it is estimated to contain 234,000 short tons of LCE (212,000 metric tons of LCE).

The bromine and lithium brine resource estimations were presented as total resource within the Upper Smackover Member underlying the Tetra property. Resource estimations were completed and reported using cutoffs of 250 mg/liter bromine and 50 mg/liter lithium.

Brady Murphy, president and chief executive officer, said, "This maiden inferred resources report increases our confidence that we have a valuable Tetra asset with two key minerals that are critical to the current and future global energy needs. With an oil and gas recovery that we believe is in the early stages of a multi-year up cycle, coupled with the projected 30% CAGR (compound annual growth rate) for the energy storage market in the coming years, 5.25 million tons (or 10.5 billion pounds) of elemental bromine inferred resource, if successfully extracted, could allow us to meet the growing demand for our offshore completion fluids market and for our patented Tetra PureFlow ultra-pure zinc bromide clear brine fluid that is a critical electrolyte component for long-duration energy storage.”

Tetra’s West Memphis chemical plant has been and is converting elemental bromine into high value offshore completion fluid, including the company’s patented Tetra CS Neptune fluid, and more recently into PureFlow.

“Extracting commercial quantities of bromine from the Smackover Formation in Arkansas is a well-established process with existing technologies and has been done for over 50 years. Tetra has held these Arkansas brine leases since the mid-1980's and is now pursuing development plans to enable Tetra to meet expected future bromine needs,” the statement said.

The 10.5 billion pounds represents approximately 380 years of supply when benchmarked to Tetra’s average annual consumption over the past 15 years.

“Any amounts of bromine that we are able to extract and use from this formation would be in addition to the volumes of elemental bromine we are currently buying under an existing long-term agreement,” the statement said.

Tetra said Intratec recently reported that the price of elemental bromine in the U.S. was approximately $4,300 per short ton.

"With battery grade LCE spot market prices of approximately $71,600 per ton as reported in a recent research report by Canaccord Genuity Capital Markets and an average selling price of approximately $58,000 per short ton from a recent second quarter financial results report of a large publicly traded international lithium producer, a lithium asset of this magnitude, if all of the lithium were realized, would provide Tetra a significant opportunity to expand our products portfolio in the fast growing battery market,” the statement said.

Tetra said it has identified a direct lithium extraction (DLE) technology based on adsorption/desorption using a proven, commercially available resin. The technology is successfully used in commercial lithium extraction operations from salar brines.

“Using our lithium-rich Arkansas brine samples from our recently completed test well, our inferred resource report details the excellent DLE laboratory and pilot unit results from our research group at our Tetra Innovation Group Technology Center in Conroe, Texas,” the statement said.

The inferred resource report also confirms that the Smackover Formation is enriched in bromine (an average of 5,371 mg/liter) and lithium (an average of 416 mg/liter), which the company expected based on its previously disclosed test well fluid sampling results.

“Based on the recent test well drilled on the Tetra 5,000 acres, the brine samples from the Upper Smackover Member within that well yielded the highest recorded lithium values (461-489 mg/liter) within the Upper Smackover Member, which may indicate uniquely elevated lithium brine within the targeted acreage where Tetra retains both the bromine and lithium rights,” the statement said.

Tetra said its next steps are to complete a bromine front end engineering and design (FEED) study that is already under way, drill the source and disposal wells, build the pipeline infrastructure and build an elemental bromine extraction plant. Tetra intents to finish a preliminary economic assessment for the bromine extraction plant this year.

“Starting in 2023, we will begin work on a lithium FEED study and a PEA for a lithium extraction plant to enable extraction of lithium from our dedicated 5,000 gross acres,” the statement said.

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