June 26 (Reuters) - Canadian lithium-focused company E3

Lithium ( EEMMF ) said on Wednesday its Clearwater Project in

Alberta would have an initial capacity of 32,250 tonnes of

lithium hydroxide per year.

Backed by Exxon's Imperial Oil ( IMO ), E3 Lithium ( EEMMF ) said in

its pre-feasibility study that its initial capital expenditure

on the project would amount to $2.47 billion.

Lithium is mainly used to make EV batteries, and has

historically been produced using water-intensive evaporation

ponds or open-pit mines. But a fleet of direct lithium

extraction (DLE) technologies is trying to upend that.

DLE technologies extract the white metal from brine using

filters, membranes, ceramic beads or other equipment that can

typically be housed in a small warehouse.

The Clearwater project is expected to have a production life

of 50 years. Over this period, the lithium hydroxide production

could reduce to 25,850 tonnes per year on average, as the

lithium grade declines when the brine starts to mix with the

production well.

The DLE process often uses lots of potable water and

electricity, and none have worked at commercial scale.

To manage the water-intensive process, E3 said all

process-affected water its generates from systems would be

recycled back to the storage tank, with the company not needing

to source any water from the environment to make the lithium

products.

The study also showed E3 Lithium ( EEMMF ) would only use 10% land

compared to a hard-rock mine.

The all-in average operational expenditure, including

sustaining and abandonment capital, over the life of the project

is projected at $8,250/tonne of lithium hydroxide monohydrate.