Lilac Solutions has selected Hatch as EPCM contractor for its 5,000 tonne-per-year lithium carbonate facility on Utah's Great Salt Lake, advancing detailed engineering under a limited notice to proceed ahead of a final investment decision targeted for late 2026. The appointment follows a completed pilot that achieved 87% lithium recovery from ultra-low-grade brine, exceeding the FEL-3 design basis, and a binding 10-year offtake agreement with Traxys covering 100% of Phase 1 output. Together, these milestones place the project among the most de-risked direct lithium extraction initiatives in North America.
Introduction
On June 23, 2026, Lilac Solutions announced it had selected Hatch as the engineering, procurement, and construction management firm for its Phase 1 commercial lithium carbonate facility on the north arm of Utah's Great Salt Lake. The agreement includes a limited notice to proceed, allowing detailed engineering and early procurement to advance before the final investment decision expected later this year. First lithium production is targeted for 2028, with the plant designed to deliver 5,000 tonnes per annum of lithium carbonate equivalent from a 20-acre site in Box Elder County.
The announcement lands at a moment when the broader direct lithium extraction industry faces persistent questions about whether pilot-scale performance can survive the transition to continuous commercial throughput. No DLE technology has yet operated at commercial scale without the use of traditional evaporation ponds, a benchmark that makes every step in Lilac's project timeline consequential not only for the company but for the credibility of ion-exchange DLE as an engineering category.
For Lilac, the EPCM appointment represents the latest in a sequence of de-risking moves that now includes completed FEL-3 engineering, a binding 10-year offtake agreement with Traxys North America, over 300 million dollars in capital raised, and an operational ion-exchange media manufacturing line in Fernley, Nevada. Raef Sully, CEO of Lilac Solutions, said simply that "Hatch has a long track record in the lithium industry and the execution capabilities needed to bring this project online."
What EPCM Means, and Why the LNTP Structure Matters
The distinction between an EPCM contract and a conventional EPC arrangement carries significant implications for a project built around proprietary process technology. Under a traditional EPC structure, the contractor assumes responsibility for delivering a completed facility at an agreed price, absorbing cost overruns and schedule risk. Under EPCM, the owner retains direct contractual relationships with vendors and construction firms while the EPCM firm provides engineering design, procurement coordination, and construction oversight. That structural difference preserves Lilac's direct visibility into costs and gives the company greater control over the technical interfaces between its proprietary ion-exchange media circuits and the conventional downstream lithium carbonate crystallisation infrastructure.
The limited notice to proceed occupies a specific and important position in the project lifecycle. It allows detailed engineering work to advance and early procurement decisions to be made without committing the full capital associated with a sanctioned project. Refining cost estimates and resolving technical uncertainties during this phase directly improves the quality of information available at the final investment decision, which is the point at which lender commitments crystallise and the financing structure is locked. The LNTP-to-FID transition is therefore not merely administrative; it is the gateway through which a development-stage project becomes a financeable infrastructure asset.
Hatch acknowledged the significance of the mandate in a statement issued alongside the announcement: "We are proud to have been selected by Lilac Solutions as the EPCM partner for its Great Salt Lake lithium project. Our team will engineer, procure, and manage construction of the 5,000 tonnes per annum facility, advancing one of the first U.S. lithium brine projects toward final investment decision. The project will apply Lilac's Gen 5 ion exchange technology to extract lithium through a non-consumptive process, supporting domestic supply while protecting the lake's water balance."
With the staged pathway now clearly defined, the project moves from LNTP-phase detailed engineering through FID in late 2026 and into a construction phase covering brine intake infrastructure, ion-exchange media circuit installation, and eluate processing and crystallisation plant commissioning, before targeting commercial production in 2028.
The 87% Recovery Figure: Pilot Performance and the Scale-Up Challenge
The number around which the commercial case is built comes from a pilot completed on October 7, 2025, Lilac's sixth successful field deployment. Operating on Great Salt Lake brine with a lithium grade of approximately 69 milligrams per litre, the system achieved an average lithium recovery of 87%, exceeding the FEL-3 design basis of 84%. Overall impurity rejection reached 99.97%. The raw eluate lithium concentration came in at 2,044 mg/L prior to any downstream concentration, and subsequent process improvements raised that figure to over 4,000 mg/L. Low boron in the eluate confirmed that no dedicated boron removal step would be required in the commercial flowsheet, a material simplification.
The feed grade context is worth dwelling on. At roughly 70 mg/L, the Great Salt Lake brine is approximately 30 times more dilute than the Atacama in Chile, currently the world's dominant lithium brine resource. Sully offered a vivid illustration of that concentration to MIT Technology Review: "It's 70 parts per million. So if you had a football stadium with 45,000 seats, this would be three people." That the technology achieved above-design-basis recovery on such a lean feed is the central technical claim underpinning the commercial project.
The engineering challenge moving from pilot to commercial operations is not trivial. The core task is designing brine intake systems, media contacting vessels, eluate processing circuits, and product finishing stages around a chemistry that has been validated at pilot scale but has never operated at continuous commercial throughput. Replicating the 87% average recovery across a full-scale plant running without interruption introduces fluid dynamics, media loading uniformity, and process control demands that simply do not exist at pilot scale. The choice of EPCM over EPC reflects Lilac's recognition that maintaining direct technical oversight of those integration points is essential during this phase.
The Gen 5 ion-exchange ceramic bead technology addresses what was historically the most acute vulnerability of ion-exchange DLE: media degradation. Earlier generations of ion-exchange lithium adsorbents were constrained to tens of operational cycles before performance declined. A short-seller report had specifically alleged that Lilac's beads worked for only 150 cycles. The Gen 4 technology, validated through 2024, demonstrated 4,000 cycles on low-grade brines. The current Gen 5 formulation is rated for up to 10,000 cycles, delivers 20 times higher media productivity than conventional alumina adsorbent technology, and consumes 10 times less water. Those durability and productivity numbers translate directly into operating cost economics; media replacement costs at commercial scale are a primary variable in the operating cost structure of any ion-exchange-based DLE plant.
The Traxys Offtake and the De-Risking Milestone Stack
The EPCM appointment does not stand alone. It is the latest addition to a de-risking sequence that has been accumulating since early 2026, and the combination of milestones now in place is unusual among North American DLE projects.
On January 12, 2026, Lilac and Traxys North America executed a binding 10-year take-or-pay offtake agreement for 50,000 tonnes of battery-grade lithium carbonate, representing 100% of planned Phase 1 production capacity. The annual delivery rate of 5,000 tonnes matches the commercial plant's nameplate output exactly. Pricing is linked to market indices. At the time of signing, Sully characterised the agreement as "a key step toward achieving final investment decision," adding that FEL-3 engineering was complete and regulatory approvals were progressing. Martim Facada, Managing Director of Lithium Trading at Traxys, described the shared objective plainly: "Lilac's unique technology and deep sector experience combined with Traxys' global market reach, expertise in natural resources and supply chain financing will contribute greatly to bring Lilac's lithium carbonate to market to supply the lithium-ion battery industry."
Facada also identified the demonstration logic embedded in Phase 1 in a separate Fastmarkets interview: "Proving the technology and execution of a project are two of the challenges of every project, so if we do it at 5,000 tonnes per year, we should be able to proceed to Phase 2 of the project or replicate this model elsewhere." That framing matters because the commercial case for Lilac extends well beyond a single 5,000 tpa facility. Phase 2 targets 20,000 tpa, and the company has completed pilot and demonstration plants across Argentina, Chile, the United States, and Europe.
The full de-risking stack now reads as follows: completed FEL-3 engineering establishing a defined-accuracy cost basis; a binding 100-percent offtake agreement in place for Phase 1; EPCM contractor appointed under LNTP; over 300 million dollars in capital raised across eight funding rounds including a 145 million dollar Series C in February 2024 anchored by Mercuria, Lowercarbon Capital, Breakthrough Energy Ventures, T. Rowe Price, BMW i Ventures, and Mitsubishi Corporation; and an operational ion-exchange media manufacturing line in Fernley, Nevada, with production scheduled for mid-2026. That Fernley facility carries its own strategic dimension: most commercial DLE technologies rely on media manufactured in China, and its commissioning eliminates that import dependency for the Great Salt Lake plant's supply chain.
Domestic Supply Context and the Broader DLE Credibility Test
Phase 1 production of 5,000 tpa would, by Lilac's own figures, nearly double current U.S. lithium output, which remains heavily concentrated at the Silver Peak operation in Nevada. A Phase 2 expansion to 20,000 tpa would bring total capacity to close to four times current domestic production. Gen 5 projects incorporating Lilac's ion-exchange technology are projected to rank in the first quartile of the global lithium cost curve, with C1 costs estimated between 3,200 and 5,500 dollars per tonne of LCE, a range that would be competitive with conventional brine operations under most lithium price scenarios.
The environmental architecture of the process is worth noting because it shapes the project's regulatory and social license position. The Great Salt Lake extraction model is non-consumptive: lithium-depleted brine is returned to the lake following the extraction step, so the process does not net-remove water from the system. There are no evaporation ponds, which require large land areas and result in permanent water loss through solar evaporation. Water consumption per tonne of product is 10 times lower than alumina adsorbent alternatives. Lilac has structured royalty and tax arrangements to generate revenue that supports lake preservation, a design choice that reflects early engagement with Utah regulators and the environmental community.
The project's importance to the DLE sector extends beyond its individual output numbers. BloombergNEF's Head of Minerals and Metals, Kwasi Ampofo, flagged Lilac's positioning as a technology vendor, rather than purely as a mine developer, as a distinctive strategic choice after the GSL pilot results were published in October 2025. If the Great Salt Lake facility achieves its 87% pilot recovery rate at commercial scale and reaches its 2028 production target, it will establish an engineering template and a performance benchmark that other ion-exchange DLE developers can reference when approaching lenders and offtake partners. The project's success would also directly address what has been the industry's persistent credibility deficit: as of mid-2024, no DLE technology had operated at commercial scale without the parallel use of traditional evaporation ponds.
Building on my earlier analysis of the West's critical mineral supply chain vulnerabilities in the context of the China blacklisting of MP Materials and USA Rare Earth in June 2026, it is worth observing that the supply chain logic driving urgency in the rare earth sector applies with equal force to lithium. Domestic IXM manufacturing at Fernley is not incidental; it is a direct response to the same category of import risk that has reshaped the rare earth conversation over the past two years. Mark Mulligan, VP of Engineering and Projects at Lilac Solutions, articulated the broader opportunity in February 2026: "We have an ion-exchange-based technology that is an in-house proprietary; we manufacture our own ion-exchange here in the U.S. It's an exciting growth area for the industry and will help unlock a lot of the resources that have not been traditionally able to be unlocked in a sustainable manner."
What Comes Next: FID, Construction, and the 2028 Target
The project timeline from this point follows a well-defined sequence. The LNTP phase, now underway, will produce refined cost estimates and resolve the principal engineering uncertainties across the brine intake, media contacting, eluate processing, and product finishing circuits. Early procurement decisions for long-lead items can be made during this period without full capital commitment. The FID, targeted for late 2026, marks the point at which full construction mobilisation begins and the project's debt financing structure is finalised.
Construction will encompass brine intake infrastructure connecting to the north arm of the Great Salt Lake, the ion-exchange media contacting circuit at the core of the process, eluate processing and concentration equipment, and a lithium carbonate crystallisation and product finishing plant. Commissioning and ramp-up will involve progressive plant optimisation as throughput is increased toward the 5,000 tpa nameplate. The first batches of Gen 5 ion-exchange media for the commercial plant will be sourced from the Fernley manufacturing facility, which was designed with ultimate capacity to support up to 500,000 tpa of global lithium production through additional manufacturing lines.
There is a revised timeline to acknowledge. Early reporting from January 2026 had cited Sully suggesting construction could commence as early as June 2026 and that Traxys supply could begin by late 2027. The EPCM announcement in June 2026 cites 2028 as the first production target. That kind of schedule evolution is typical in complex process plant development, particularly when the LNTP phase is being used precisely to sharpen engineering inputs before committing full capital.
The broader question the project will answer, if it executes as planned, is whether ion-exchange DLE has genuinely crossed the threshold from a compelling pilot technology into a repeatable commercial process. The technical performance data, the financing trajectory, the manufacturing supply chain, and the offtake security are all now pointing in the same direction. What remains is construction and commissioning, the phases that have historically sorted credible DLE developers from those who stall at the demonstration stage.
Conclusion
The engagement of Hatch under a limited notice to proceed is a specific and measurable milestone in DLE commercialisation, not a press release milestone. It means that a qualified engineering firm with demonstrated hydrometallurgical project delivery capability is now actively resolving the detailed design questions that separate a validated pilot chemistry from a bankable commercial plant. Combined with a 100-percent covered offtake agreement, completed FEL-3 engineering, domestic media manufacturing, and a capital base exceeding 300 million dollars, the Great Salt Lake project is carrying a de-risking profile that is rare among North American DLE initiatives at any stage of development.
The central technical test remains unchanged: replicating 87% lithium recovery across continuous commercial throughput at a feed grade 30 times more dilute than the Atacama. The Gen 5 ceramic bead formulation, with its 10,000-cycle durability rating, addresses the most historically problematic failure mode in ion-exchange DLE. Whether that durability translates to sustained commercial-scale performance is the question a FID in late 2026 and a 2028 production start will begin to answer.
For the U.S. lithium supply chain, the stakes extend well beyond Lilac's own Phase 1 output. A successful commercial demonstration at Great Salt Lake would establish an engineering reference point and a performance benchmark that the entire DLE sector, and the lenders and offtake partners who must ultimately finance it, currently lacks. The FEL-3 is done, the offtake is signed, the media manufacturing line is running, and the EPCM contractor is engaged. The next decision belongs to the capital markets.