Schlumberger has entered into an earn-in agreement with Pure Energy Minerals Ltd that could see it become the 100% owner of a lithium brine project in Nevada, US.

Pure Energy has granted subsidiaries of Schlumberger an option to acquire all of its interests in the Clayton Valley project in return for constructing, at its own cost and expense, a pilot plant for the processing of lithium brine.

Schlumberger, which is more used to providing services to those in the oil & gas field, has a three-year period in which to exercise the option and may only exercise it if it has completed construction of the pilot plant and test work, which achieves certain parameters, Pure Energy said.

Upon exercise of the option, Pure Energy will be entitled to a 3% net smelter returns royalty on minerals produced at the Clayton Valley and an advance minimum royalty payment of $400,000 per year starting January 1, 2021, for a period of five years or until the project achieves commercial production.

Pure Energy and its technical consultants have completed the basic design for the proposed pilot plant which could cost an estimated $15-$25 million. The company has received a water right from the Nevada Division of Water Resources to extract the lithium-bearing brine needed for operation of the planned pilot plant.

The pilot plant design is being led by Tenova Advanced Technologies with significant contributions from SUEZ Water Technologies & Solutions, a business unit of SUEZ Group, and NORAM Engineering & Constructors. The facility at the project will be the first pilot-scale implementation of the Tenova Process in the world. This process is specifically designed to exclude solar pond evaporation, increase and accelerate lithium recovery, and reduce the associated environmental footprint of lithium production.