One company's plans to harvest 'rare earth materials' earned it 2020's 'most promising new business' award by the Oklahoma Venture Forum
Oil and gas aren’t the only valuable commodity wells can recover.
Rare earth materials are often found suspended in saltwater produced by wells, and at least one Oklahoma company plans to go after those materials specifically.
Galvanic Energy, formed in 2018 by a group of energy executives led by CEO Brent Wilson, earned recognition from the state’s business establishment this year when it was presented with the Most Promising New Business Award from the Oklahoma Venture Forum.
The award, which recognizes entrepreneurial achievements in the state, evaluates nominees’ business plans, how they are led and funded and their potential to positively impact markets, industries and communities.
Wilson said his company and others have a unique opportunity to begin producing critical materials from produced saltwater that are mainly imported into the U.S. today.
Rare earth materials deemed critical by the U.S. Department of Interior in 2018 include several dozen including aluminum, arsenic, cesium, gallium, magnesium, platinum group metals and zirconium.
Other rare earth metals on the list — such as cobalt, graphite, lithium and manganese — are specifically used in the manufacturing process for electric vehicles, Wilson remarked.
Beyond that, U.S. Sen. Ted Cruz, R-Texas, introduced the Onshoring Rare Earths Act of 2020.
The legislation seeks to end the nation’s dependence on China to provide it with rare earth elements and other critical minerals.
It calls on the U.S. Department of Defense to source those materials domestically to help build a production supply chain.
Additionally, it proposes tax incentives to promote growth of the rare earths industry and to establish grants to create U.S. pilot programs to help it develop.
“America today is completely dependent on other countries for critical elements,” Wilson said, noting that the country could never hope to meet its needs if it sought to recover them through conventional mining techniques.
He estimates traditional U.S. mines only are recovering about 2% of what is being produced globally.
A significant key to being able to profitably recover rare earth materials from produced saltwater is to learn where they can be found in abundance.
The company, therefore, has been working hard since its inception to identify reservoirs associated with certain oil and gas fields where those materials can be economically produced.
Wilson said Galvanic is well on its way to securing production rights from mineral holders that involve a “world-class reserve,” noting there are several fields in the mid-Continent that could fit that bill. Wilson hopes leasing activities for its first area will be wrapped up before the end of this year.
The concept of recovering rare earth materials isn’t brand new. Oil and gas operators have been lobbying Oklahoma legislators for years to obtain a state law that gives ownership of produced water to well operators to help encourage the new industry’s growth.
Oklahoma’s legislature drafted and approved such a law this year.
“If you are focused on the materials as secondary, that legislation will have a big impact,” Wilson said. “But in our case, we are securing rights to produce rare earth materials specifically. There are older oil and gas fields that are enriched with brines that have things like rare earth materials, or other items of value.
“We want to go in and give these old fields a new life, giving them a second opportunity to stimulate the economies of surrounding communities.”
He said the company soon plans to enter its pilot phase to test extraction technologies, which will require additional funding.
While desalination systems could play a role in recovering the materials, Galvanic is using different technologies to recover them before reinjecting processed water back into the formations from where it was taken.
The company will use a production process akin to secondary oil recovery work.
“This will open the door for new investors to capitalize on this new energy resource revolution,” commented Wilson, adding that having a local supply chain of rare earth materials could assist Oklahoma in growing its manufacturing industry, demonstrated by recent news that Tulsa could be the home of a new Tesla production facility.
“Unconventional solutions like ours will lead America to sustainable energy independence, and we’re excited to contribute to this goal.”
The company currently employs six people and has plans to grow. As for the recognition from the Venture Forum, Wilson said that came as a surprise, given he and his team were unaware of the award until hearing they had been selected.
“That was great,” he said.