The Canadian government is investing CAD 27 million ($20.0m) in E3 Lithium and its plans to build a lithium-extraction demonstration plant in Alberta, Kallanish reports.

The grant came from Canada’s Innovation, Science and Economic Development’s Strategic Innovation Fund (SIF) and will help fund the planned CAD 87m demonstration plant. The grant was made possible through the SIF’s Net Zero Accelerator initiative.

The demonstration plant is expected to produce 20,000 tonnes/year of battery -grade lithium hydroxide monohydrate from Alberta’s depleted oilfields and would enable E3 to become a major producer of lithium in North America from the Leduc Aquifer in Alberta’s Bashaw District.

The SIF investment supports all aspects of E3’s resource and technology development including drilling, piloting of proprietary ion-exchange technology, process development and engineering including downstream lithium hydroxide conversion. The investment also supports additional development testing during the feasibility phase and the engineering and design of a definitive feasibility study.

The company will be reimbursed at 33.94% for eligible costs. The company will be required to repay the government funds if and when it earns gross revenues. The repayment will take up to 20 years.

The funding will significantly de-risk the project as the company moves toward a commercial facility, says president and ceo Chris Doornbos.

The company is developing three test wells in Alberta, to determine lithium concentrations. The first well was completed near the town of Olds, Alberta, at the centre of the company’s Clearwater Project area. It is a candidate location for the company’s first commercial operation. The other two test wells will be tested soon.

E3 Metals has developed a proprietary lithium-selective sorbent to extract lithium from brine in its direct lithium extraction process. E3 Metals has inferred resources of 24.3m t of lithium carbonate equivalent inferred resources in Alberta.