The Geopolitics of Critical Minerals: Who Controls the Geothermal Brine Supply Chain?
The geothermal brine supply chain is quickly becoming a geopolitics story, not just an energy story.
As lithium demand rises and governments race to secure strategic materials, control over underground brines, processing capacity, and export rules may matter as much as who owns the power plant.
Introduction
For years, geothermal projects were valued mainly for clean baseload electricity and heat. That is changing because many geothermal fields also contain dissolved lithium and other critical minerals, turning brine into a potential dual-purpose asset: energy plus minerals.
That shift matters because critical mineral supply chains are already highly concentrated, and Europe is actively trying to reduce reliance on single-country suppliers through the Critical Raw Materials Act. China remains central to lithium processing and broader mineral refining, giving it leverage even when ore or brine is extracted elsewhere.
Why brine matters
Geothermal brine is not a simple byproduct anymore; in the right geology, it can become a feedstock for lithium recovery through direct lithium extraction and related processing pathways. That makes the underground reservoir strategically important, because the value is no longer limited to electricity generation.
In practical terms, the question is no longer only “who built the plant?” It is also “who controls the reservoir, the extraction rights, the processing technology, and the downstream refining contract?” In a world of supply shocks, that chain of control is where geopolitical power accumulates.
China’s processing leverage
China’s strength is not just mining; it is processing, refining, and conversion. Reuters reports that China is expected to overtake Australia as the world’s top lithium miner by 2026, while also remaining dominant in refined lithium and broader mineral processing networks.
That distinction matters because raw material ownership does not automatically translate into industrial power. If geothermal producers in Europe, Latin America, or Africa export brine-derived concentrates into Chinese processing ecosystems, they may reduce one dependency while deepening another.
EU pressure to diversify
The EU’s Critical Raw Materials Act is built around exactly this vulnerability. It seeks to secure sustainable supply, reduce dependence on imports from single-country suppliers, and strengthen the entire value chain from extraction to processing and recycling.
The Act also sets 2030 benchmarks: at least 10% of annual EU consumption from domestic extraction, 40% from processing, 25% from recycling, and no more than 65% of any strategic raw material from a single third country at any relevant stage of processing. That policy architecture creates a strong incentive for Europe to support domestic or partner-country geothermal lithium projects that can feed non-Chinese processing routes.
Who owns the brine
The legal core of the geothermal-brine debate is ownership. In many jurisdictions, the subsurface is treated as state property, while surface rights, mineral rights, geothermal concessions, and water rights can be split across different legal regimes. That fragmentation creates room for dispute, especially when brine begins to carry commercial mineral value.
This is why some governments are considering tighter control over underground resources, concession redesign, or local value-add rules. If a country concludes that brine is a strategic national asset, it may require domestic processing, local equity stakes, revenue-sharing, or export restrictions to keep value at home.
Nationalization risks
The phrase “nationalizing underground resources” sounds dramatic, but the underlying logic is familiar. Governments often tighten rules when a resource becomes strategically important, especially if foreign firms control extraction while local communities bear environmental and social costs.
For geothermal lithium, the risk is that aggressive national control could slow project finance, delay permitting, or trigger investor uncertainty. On the other hand, weak governance can produce the opposite problem: foreign capture of value with limited domestic benefit. The winning model is usually not pure nationalization, but clear concession law, transparent royalties, and enforceable local-processing expectations.
Investment and supply security
For institutional investors, geothermal lithium is attractive because it sits at the intersection of energy transition, mineral security, and industrial policy. But the investment case depends on three variables: geology, process economics, and policy stability.
The EU’s push to diversify supplies gives these projects a strategic tailwind, especially if they can support European processing capacity or allied supply chains. Yet China’s entrenched role in refining means many geothermal lithium projects may still need nontrivial capital, technology transfer, and offtake guarantees to become bankable at scale.
What happens next
The next phase of competition will likely be defined by midstream control. Countries that can pair geothermal extraction with domestic refining, robust permitting, and stable regulation will capture more value than countries that only export raw brine or concentrate.
We should expect more strategic partnerships, more state involvement, and more competition over who gets to define “secure supply.” In that environment, geothermal brine is not just an input to clean energy; it is a geopolitical asset with the power to redraw mineral dependencies.
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