Good afternoon, everyone. Thank you for taking a little time today for LibertyStream. LibertyStream is a pretty simple story. We sell American lithium to American customers. This vial here is from a refining facility on site in West Texas. Last time that I had the opportunity to present at Planet MicroCap was last fall in Toronto, and at the time when I was presenting in Toronto, we were talking about all the things that we could do. Where we've come from since last fall to where we're at right now is, last fall, we were talking about starting to do refining. Last fall, we were talking about how we can start working with customers, how we can start selling product. Since then, we've started our refining in the field. We've shipped our first ton of product to a customer, an industrial customer in America.
We validated that customer as they did in their processing and testing of everything that we're doing. Now we've signed our first offtake agreement. From an American lithium perspective, we're well on the road to what we're doing. A quick highlight in terms of LibertyStream, what we look like today. What you can see from this picture on the right side of the screen, sorry, on the left side, this is our facility that we're at in West Texas. This facility is a recycling facility for water, for oil field brine. This facility can process up to 300,000 bbl of brine per day, and all that brine has lithium in it. What that means for us from that recycling facility is that we're able to extract lithium from it.
At this site, our first site, as we move into the latter part of this year, what does that mean for us? The facility's got a capacity where we're going to be able to produce 1,000 tons per annum. We've announced an offtake with a customer to sell 600 of that 1,000 tons per annum. Our operating costs in terms of what it's going to cost us to make it is about $6,200 a ton. Lithium today is trading in the mid 20,000s. It's a highly profitable business model, and this is happening today. In terms of what we're looking at from a lithium demand perspective, we've got term sheets with a number of groups that represent up to about 10,000 tons per annum of demand. What does that mean in terms of the greater size of the basin here?
The basin today produces about 20 million barrels of brine per day, which is the equivalent of probably one of the largest sources of lithium in the world. In terms of a processing perspective, we've been doing this for a couple of years in the field. What does it look like? What do we have to do? How do we actually do the lithium extraction and refining? There's three components to our process, pretreatment, extraction, and refining. We're doing all three at the site right now. In terms of the pretreatment, that's a really important step for us. What we need to do before we do our lithium extraction is we've got to take the iron and organics out of the brine.
We've signed a partnership deal with a group called Select Water, who's traded on the New York Stock Exchange, we've been partnered with them since February, they do all the pretreatment for us. In terms of the extraction side of the business, you can see our facility that's out in the field right now that is doing lithium extraction. As we move into the latter part of the year, we're going to be extracting, as I mentioned, we'll be processing about 120,000 barrels a day, which is going to produce about 1,000 tons of lithium. On the final side, which is the key, it's on the refining side. We're doing our refining on-site in the field right now. We have been meeting customer specs, we've got a lot of demand for what we're trying to do here. What does that mean?
Well, the key for us is customers, offtakes. We announced a couple of weeks back that we've signed a first offtake agreement with an American industrial customer. We're going to be shipping our lithium carbonate to their plant in Alabama, that's going to start in Q1 of 2027. It is a long-term agreement. It's a minimum five-year deal. We've got some fixed pricing for the first two years, which is a great benefit for us. Why did we establish fixed pricing for the first two years? Because we're working on project financing right now as we speak. In terms of qualification validated, this isn't just providing them a ton and we're selling product. We've been working with them for the last two years. We've been sending samples all along. We've been qualified the whole time.
What ended up happening is when we delivered our first ton, we hit their qualification specs, then we announced our offtake agreement. What does this mean? Why are we doing this in America? Why is this so important for us? Well, right now, 85% of the world's lithium is refined in China. What we're doing at LibertyStream is we're going to break some of that pattern. By doing our own refining on-site in West Texas, we're able to supply American customers from West Texas, that's really important for us. We see a huge opportunity. There's a big push for Buy America for lithium and other critical minerals, we're the first out of the gate to do this. There's other projects and other groups talking about getting into production as we move into the end of this decade, 2028, more 2029, some 2030. We're doing it today.
That's important, it's strategic, the customers are lining up. In terms of pricing, a lot's changed in the world from a lithium pricing, there's also a massive shortage in terms of the ability to supply. What we see happening by 2034 is that there's going to be a shortage of lithium, a gap of about 600,000 tons per annum. I mean, at best, the Permian Basin can do about 200,000 of that. There's still going to be a shortage. There's a lot of projects being talked about around America. Even if every single project comes on, it's still not going to meet the demand that we see in America, that's a really big deal. We see things like data center build out. We saw what happened with SpaceX this week, with automation, AI, everything.
It's coming, and it's coming fast, and we want to be prepared for it. What we've done on this slide on the left is just to show what's been happening. The March 26th forecast from Fastmarkets, it showed lithium pricing in that sort of $20,000 range, a little bit dipping as we moved through 2027. We've seen a pretty fundamental change as we've been moving. The May forecast now has us in that $30,000 ton per annum range. This is a really big deal. We're seeing a massive shortage that's coming up. Data centers are a big part of why that's happening. From our perspective, when you've got operating costs at $6,200 a ton, we're going to be the low-cost provider. We see a real opportunity to have a very profitable business as we move forward. What makes us different from the other groups?
What's key for us is we're in production today, there's not a lot of groups can say that. Actually, there's one. That's so important because when we start talking with customers, they're saying, Look, we want samples. We want product from the field. We don't want it from a lab. We want to know that you're going to be able to go in production." The ability to provide tonnage from the field is so crucial to what we're doing. Our technology is so important. For us, it's been taking two years in the field to get to the point where we are at. Lots of other groups are talking about doing work with their technology. We're the ones that are doing it in the field. Field technology, battle tested in the field, translating and refining in the field, translates into customers.
That's a big deal for where we're going. A big thing as well for us is our capital efficiency. People look at projects. If we didn't have the infrastructure in West Texas that we do, for us to get off the ground, our capital efficiency is $37,000 a ton, double that if we had to be drilling our own wells, building the infrastructure, and doing everything. It's a really, really big deal that we're partnered with the oil and gas industry. They're moving the water today. There's lithium in that water. We're taking advantage of that by partnering with industry. Again, talked about our operating cost advantage. That $6,200 a ton is so key. If we had to develop and deploy our own infrastructure, you'd be doubling those costs.
It allows partnering in the oil and gas industry by working with the oil and gas industry keeps our costs real low. The growth perspective, and this is just so important. Someone had to actually get out there and do it, and we're the ones that are out there and doing that. What's happened from that? Well, Select, as we've put out in press releases, they move about two and a half million barrels of water a day. That's the equivalent to about 25,000 tons per annum. They've got 26 sites around the basin that we can deploy. They're not the only ones. We're in discussions with groups that are moving 10 million barrels of brine in the basin today. That represents about 100,000 tons per annum.
To put that into perspective, the largest lithium company in the world produces 65,000 tons on three continents. We can do this all within a four-hour driving span. It gives us a massive advantage by keeping things close to home. Again, built for speed. That's just so critical. Again, by not building out the infrastructure, you don't have a two-year, three-year permitting process. The infrastructure's in place. What we have to do when we partner with groups, we just have to do an amendment to the surface lease. It makes such a difference. We can get a project up and running. If we say to a customer, a customer says we need 1,000 tons, it's an 11-month deployment for us. Critical and crucial for our ability to execute and deliver product to customers.
This is another picture of the site, just as just a bigger scale version of what this looks like. This is so relevant, this picture that we've got. This is about a month and a half ago. We've put in a lot of construction since then. Effectively, the way it works in the basin here is you've got water that comes in to area number one. They're called ASTs, or above surface tanks. From number one, that goes through to number two, and that's Select's equipment. What they do is they pre-treat the water. This water has to be pre-treated anyways. The exact pre-treatment step that we need for our business is what they need to do in terms of their recycling business in the industry. We're not doing anything new. The water goes from number two and into those two ponds.
Each of those ponds is 750,000 bbl. That's about 10 days inventory for us. We've got the inventory. They're moving that water every day, and like I said, the capacity of that site is 300,000 bbl a day. What we're going to need to do is 120. We're not overtaxing the system, we're not overleveraging the system, and we see that as a real opportunity for us. This is a little picture of end product doing our refining work. What's key on this slide, though, is the customer specs that we're meeting. We're meeting customer specs today. We talked in our press release about sending product to industrial customers. The reason why we're doing that, quality specs are a little bit lower. When we're talking about 98% or 99% versus 99.5% for battery grade, it's an easier threshold to hit. We produce battery grade.
It's just the qualification for battery grade is longer. If we wanted to start with a customer today for battery grade, it takes about two years. For industrial grade, it takes six months. We've proven that through the first offtake that we've announced. While we're going through this process of selling to the industrial customers, we're making battery grade and we're refining it, and we're getting ready for demand as we move through to 2028. Again, we're the only ones that can talk this way. Why? Because we're the ones that are actually doing it in the field. This is just a sort of a recap in terms of what we've been doing. Again, we've done the testing, we've done the work. We've had the results, and the industry's responding very favorably, and we see that as a real opportunity. Just a little bit about the team.
Seasoned team, we've all been at it for quite a while. The key thing for our team is we've been all working together for a bunch of years. The company was started in 2020, so we've been at it for a long time, and we're really focused on what we're doing. Once again, just to highlight, we're doing it today. We're battle tested in the field. We're actually working. We've signed an offtake agreement. We've signed a feedstock partner. We've got access to the product, being water that's being delivered to us. We've got access to the customers because we're signing the offtakes, and now from here on in, it's just about execution. Thank you very much.
I have a question. Why is there lithium in the brine, and will it always be there?
Well, so in the Permian brine, there has been. We've been analyzing for the last 10 years. Okay? We have every reason to believe that it's going to be there. It's formational in the geology in terms of the subsurface. We see a run rate in the basin for about 40 years in terms of lithium production. To put it into perspective, the group that we've signed with Select, they signed 20-year water deals. That's a really big deal for our customers. They want to know that product's going to be around, that we can supply them for a long time.
Are there other rare earth elements, a lot of those you've looked at, that you're certain of?
There are. Yeah. There's a whole bunch of things in the water. One of the things we can say, what we're looking at right now in the Permian water, there's things like magnesium, calcium, there's strontium. There's boron, iodine, all kinds of things. We're focused on lithium today. We will look at other rare earths and other sort of critical elements as we move forward, but today the path is really focused on lithium. Yes, sir.
Is the feedstock centrally located or do we have to think about as you scale, you'll be building a manufacturing site at the source of the feedstock?
Sorry. Yeah, you were asking about the manufacturing
The feedstock.
Yeah.
Centrally located, has it been piped in to get to you? Do you have the ability to manufacture in principle here at the source?
Yeah. I'll just go back to this slide here. The feedstock, that's that water. Okay? Like I mentioned, they've got 300,000 barrels a day running through that. We need 120,000. They've got capacity for 300,000 barrels a day. That's the feedstock for our lithium. What we're going to be doing and what we are doing right now is we're not only doing the extraction on site, but we're doing the refining on site. We've taken the view, it's much more efficient to refine on site. Anytime you put lithium in a truck or do anything, it's costing you money. If every truck costs $1,000, that's $1,000 added to your operating cost. This 1,000 ton per annum facility, as I mentioned, we've got an offtake for 600 of those tons. We're going to be tailoring our plants to the needs of our customers.
They find that really important. There's some groups talk about doing larger facilities, like 20,000, 30,000, 40,000. Our customers are saying, We like the fact that you're going to have a distributed model. We're going to, like I said, Select's got 26 of these sites across the basin. That's 26 facilities for us. From a customer perspective, we're looking at a bunch of customers in the 1,000 to 2,000 to 3,000. We've got a couple of 5,000 ton per annum. We got some bigger customers. They like the fact that we're going to have multiple facilities. Facilities go down for maintenance, things happen. They like the fact that we're always going to be up and running with each of the facilities we've got.
What's the only equipment you're using? How much does it take to get up and running on this?
Yeah. There's three components to that in terms of the equipment. The DLE equipment we're using, that's the actual extraction equipment for us. The total cost is about $37 million. The equipment itself for the DLE is about $14.5 million. The refining unit is about $8.5 million, and that's for 1,000 ton per annum site, where the media costs are about $5 million that we do all in-house. Some call it media, some call it resin. We do all that in-house. The rest is construction equipment and other things. From an efficiency perspective, I just haven't seen anything even close to it. Yes, sir.
Where do you lie on the cost curve compared to your international competitors?
Sorry, what was that?
Where do you lie on the cost curve compared to your international competitors?
For facilities that are up and running right now, we're at the low end of the cost curve. There are some spodumene, there are some salar facilities in Chile and places like that that are a little bit cheaper. I would say that would be overproduction. Anything that's new that's coming on, you just can't compete. There's a fundamental difference between our cost and everyone else. We're not drilling wells. If we had to drill wells, if we had to move the water ourselves, add 50% to our costs, maybe 100%. Now we look more like everybody else. We don't have to do that because it's already happening in industry. Yes, sir.
You talked about your first deal, and it being a two-year with fixed pricing.
Yep.
Is that going to be your business model moving forward, or was that just to get them locked in? Secondly, any concern with the volatility of pricing, that you locked yourself in to a price that's not advantageous for you?
It's the conundrum for any company getting off the ground. Our project finance guys, they want some certainty in pricing. That's what we're providing. Our payback on this equipment is about a year and a half to two years. That's why we looked at the two-year fixed pricing, the deal that we've got. As we move forward, it's going to be more index based. Now, there's a bit of a challenge in this whole scenario. Once you get over $30,000 a ton for the price of lithium, the industry starts to cannibalize itself a little bit, we're mindful of that. Now, will it go higher? We think it is. When you look at the growth from a data center perspective and everything that's happening, it's going to get pretty outrageous. I hope it stays below $30,000, because otherwise the industry cannibalizes itself.
If it doesn't, well, we're there and we're supplying. We've got this unique situation, and that is, we're the only ones doing it in America. Next closest group's about three years away. Yes, sir.
Yeah, Alex, I got a couple questions surrounding the cost that you quoted for time. Can I presume that that's an OpEx cost that's not including the sum in CapEx for the facility already, or is that also including that and just coming back?
Yeah. It is our operating cost. There is maintenance cost in there, okay? That also includes the royalty that we're paying to Select. It's a fully loaded cost that we've got.
Not including CapEx then.
Not including CapEx, correct.
The 6,200 is based on what purity?
Well-
How much does your cost structure change if you're 99.8%? You had the ABC customer 99.59. I can't remember the numbers, but if you understand my point.
Let me turn it around another way. The purity that we're making right now is 99.8%. It's not about the purity so much, it's about the impurities, and it's all about the qualification process. I'll give an example. The group that we just signed an offtake, they need chlorides at battery grade spec. We do that at battery grade spec. When we're doing our product, what we're looking at is all the product we're making is battery grade. We're always going to do that because there's nuances of each of the customers that one has a low tolerance for boron, another company has a high tolerance for boron. One group has low tolerance for magnesium, the other one has a high tolerance.
We've taken the view that we're going battery grade throughout, and the only reason why we're not selling battery grade right now is because it's a two-year qualification process. We are actively supplying product, though, to the battery grade customers. When I look at our process, or you look at anyone that's doing any type of lithium extraction, you got to factor in two years for battery grade groups. Like I said, industrial groups are very different. If you're selling a product that is, say, ceramics, that's way different than, say, an EV battery. The mission critical factor is just different. Those EV makers, it's reckless if they just take product that they've only been testing for six months from field testing. It's really just qualification process.
I'm not really sure I understand your answer to the question. Does it matter what you deliver to the customer? Does your cost structure change at all based on what they require?
It does not.
$6,200 irrespective of the quality that you deliver.
Correct.
Out of that 6,200, is there some sort of a reagent or something or a series? I'm sure it's part of the secret sauce. Where do you source that from, and how much of that reagent is based in China? Can you give us a perspective of how much of your cost structure is based on those reagents or series?
Okay. There's a number of parts to that question. We use, for our media, okay, we have to have our formula. We have to have our compound for our formula. For our reagents, there are two reagents that we use. We use caustic soda, which is NaOH, and we use hydrochloric acid. What we're doing at our site when we're up and running at our first site, and as we move forward, we're using a process called bipolar electrodialysis to create our reagents. What does that mean? Well, for every ton of lithium that we produce, we produce 32 tons of hydrochloric acid. We also produce caustic on site, so what we do is we reuse those. Now we're going to have an excess supply of hydrochloric acid, so we're going to be able to sell it off.
We are not getting any reagents from China or anywhere else. This is all from the oil fields.
Thank you.
How are you tracking your Nasdaq up listing?
Sorry?
How are you tracking towards the Nasdaq?
I just missed that.
Nasdaq up listing.
Yes, okay. Where are we at on the Nasdaq? I think you'll see something with us later this year. We're actively looking to relist. We've had to go through a bit of a process. We're a Canadian company. We re-domiciled to Texas in April, and now we're actively looking for a Nasdaq listing. Expect later this year, beginning next year, but I would count more on Q4. I think my time's up.
Yeah. I think it's all up. Alex, thank you so much, though, for your presentation.