Nov 12 (Reuters) - Standard Lithium Ltd said on Monday it had signed an agreement with Lanxess AG to build a pilot plant that will process lithium from Arkansas brine, part of an ongoing study on whether to develop a joint venture to produce the white metal.
The pair aim to eventually produce lithium - a key component of electric car batteries - on a mass scale from brine that is a byproduct of existing bromine production facilities run by Lanxess in the southern state.
The lithium production process would be different from the evaporation ponds typically used in Chile and elsewhere to produce the metal.
Vancouver, British Colombia-based Standard Lithium said it has developed a proprietary lithium extraction process that would rely on existing Lanxess infrastructure in Arkansas as well as the German company's brine.
"This will be a key step in developing a lithium industry in Arkansas," said Robert Mintak, Standard Lithium's chief executive. "The pilot plant has to show that it's a process that can work long term."
As part of the agreement, Standard Lithium and Lanxess will build a pilot plant in Ontario and then ship it to Arkansas where it will run for at least 12 months as part of a test phase. The plant will use an adsorption process to capture lithium ions from liquid brine, typically a waste product from a bromine production process.
Depending on how the pilot process goes, a joint venture announcement could come early in 2020, according to Standard Lithium.
"The cooperation with Standard Lithium is still at a very early state, but could open up exciting prospects for us in a forward-looking industry," Lanxess Chairman Matthias Zachert said in a statement.
Financial terms of the deal were not disclosed, though Lanxess said it was prepared to provide funding for the joint venture to commercially develop the lithium project.
Albemarle Corp, the world's largest lithium producer, also has a bromine facility in Arkansas. (Reporting by Ernest Scheyder Editing by Tom Brown)