Oil and Gas Companies Entering the Geothermal Energy Industry Oil and gas companies are becoming increasingly active in geothermal energy. Their involvement includes direct project development, investment in geothermal startups, drilling and well services, engineering, equipment manufacturing, subsurface studies, geothermal heating, and the conversion of abandoned or nonproductive oil and gas wells. At least 80 oil and gas companies have some form of participation in the geothermal sector. When major oil companies, national oil companies, oilfield-service providers, drilling contractors, engineering firms, geoscience companies, equipment manufacturers, investors, and technology startups are included, the number can reasonably exceed 100. This shift is one of the most important developments in the modern geothermal industry. Oil and gas companies already possess many of the skills required to develop geothermal resources, including geological interpretation, seismic imaging, reservoir m...
A strategic milestone for Pakistan’s critical minerals strategy
Image : A Thematic image of a Geothermal Project
Pakistan’s Oil & Gas Development Company Limited (OGDCL) has confirmed a high‑grade lithium occurrence in geothermal brine from the Wahid Bakhsh well in Khairpur, Sindh , and moved quickly to partner with the Pakistan Institute of Nuclear Science and Technology (Pinstech) to develop indigenous extraction technology.
The discovery, reporting 275 mg/L lithium in produced formation water, sits well above the commonly cited 90 mg/L commercial threshold used internationally for geothermal brine projects. This article examines the technical significance, commercial pathways, environmental advantages, risks and next steps for investors and industrial stakeholders.
Why this discovery matters
Strategic mineral importance: Lithium is central to lithium‑ion batteries that power electric vehicles (EVs), grid storage, consumer electronics and numerous industrial applications. Forecasts project sustained high demand as electrification expands globally.
Resource quality: At 275 mg/L, the Wahid Bakhsh brine concentration compares with projects pursued in Europe and North America, making it a potentially attractive target for scale‑up if reservoir volumes and flowrates support economic extraction.
Dual‑benefit resource: Geothermal brine lithium can be produced alongside geothermal energy, offering revenue diversification and lower lifecycle environmental impact compared with hard‑rock or salar mining.
Industrial policy implications: Domestic lithium could underpin Pakistan’s nascent battery, EV and defence‑grade supply chains; Heavy Mechanical Complex (HMC) is reportedly assessing uses for domestic lithium, signalling early industrial demand.
Technical background: lithium in geothermal brines
Source and mechanism: Lithium in geothermal systems typically originates from water‑rock interaction at high temperatures; circulating formation water leaches lithium from host rocks and concentrates in brine.
Typical indicators: High temperature, saline fluid chemistry and specific element ratios (e.g., Li/Mg, Li/Cl) guide prospect evaluation.
Commercial benchmarks: Many developers consider >90 mg/L a minimum for consideration; economic viability depends heavily on brine flowrate (m3/h), reservoir sustainability, and co‑produced heat value.
Extraction technologies: Approaches include direct lithium extraction (DLE) using selective sorbents or ion‑exchange, membrane separation, solvent extraction, and traditional evaporation, DLE is gaining traction for brines due to faster processing and smaller footprint.
What OGDCL–Pinstech collaboration aims to achieve
Indigenous DLE R&D: Pinstech brings scientific and lab‑scale capabilities; OGDCL provides subsurface data, brine samples, and field testing platforms. The partnership aims to develop tailored extraction processes adapted to local brine chemistry and temperature regimes.
Field demonstration: Testing pilots at identified Sindh wells to quantify brine chemistry, flowrates, thermal gradients and scaling/fouling behaviour under production conditions.
Resource confirmation and reservoir modelling: Integrated geochemical and geothermal reservoir studies to estimate in‑place lithium resource and sustainable extraction rates.
Environmental and social baseline studies: Establishing frameworks for water management, waste brine handling, and community engagement to de‑risk permitting and social licence.
Reservoir and resource considerations investors must watch
Brine concentration vs. resource size: High concentration matters only if reservoir volume and sustainable flowrates support production over decades.
Temperature and depth: Higher temperatures increase geothermal power co‑production potential and improve some extraction kinetics; drilling depth affects CAPEX.
Brine chemistry complexities: Presence of interfering ions (e.g., magnesium, calcium, boron) affects DLE selectivity, recovery rates and downstream refining costs.
Recharge and sustainability: Hydrogeologic recharge rates determine how quickly brine concentrations might decline with extraction; closed reservoirs risk depletion.
Scaling and materials issues: High‑temperature, high‑salinity fluids accelerate corrosion and scaling, increasing O&M and metallurgy requirements.
Economic pathway: from discovery to commercial lithium
Step 1 , Detailed brine characterisation: multi‑element assays, isotopic analyses, speciation and temperature‑pressure profiling.
Step 2 , Pilot DLE testing: lab selection of sorbents/membranes, benchscale recovery metrics (selectivity, capacity, kinetics), and pilot plant trials at the wellsite.
Step 3 , Integrated geothermal‑lithium model: combine energy production revenue with lithium revenue to evaluate integrated project economics. Co‑production often materially improves project IRR.
Step 4 , Feasibility and bankable reserve report: independent resource classification (aligned with international reporting standards) and feasibility modelling to attract off‑take and financing.
Step 5 , Industrial downstream strategy: decisions on producing battery‑grade lithium carbonate/hydroxide domestically versus exporting intermediate concentrates will shape required refining investments and value capture.
Environmental and regulatory advantages
Lower land and water footprint: Geothermal brine extraction avoids large open‑pit or salar evaporation operations, reducing land use and visual impact.
Co‑production benefits: Generating geothermal power alongside lithium can decarbonise operations and improve economics, lowering scope‑1 emissions relative to conventional mining and concentrating pathways.
Waste management: Effective brine reinjection and closed‑loop systems can minimise subsurface and surface contamination if designed correctly.
Policy enabling: Pakistan can accelerate value capture by establishing clear permitting routes, fiscal incentives for critical mineral projects, and technology standards for DLE pilots.
Risks and technical challenges
Scale of recoverable resource: The 275 mg/L figure is promising but not yet proof of commercially recoverable volumes — extensive resource confirmation is required.
Technology readiness: DLE technologies are rapidly evolving, but few have large commercial operating histories at high temperature/complex chemistry geothermal sites; R&D to adapt materials and processes is essential.
Capital intensity and project timelines: Drilling, pilot plants, metallurgy and downstream refining require significant upfront capital and multiyear timelines for demonstration and commercialisation.
Geopolitical and market risks: Lithium prices and EV supply chain shifts can create volatility; securing long‑term offtake and aligning with national strategic objectives will de‑risk investments.
Environmental permitting and community expectations: Local environmental impacts, water use concerns and land rights must be proactively addressed.
Strategic opportunities for Pakistan and domestic industry
Domestic battery ecosystem: Secure local lithium supply could catalyse a battery manufacturing ecosystem, supporting HMC’s vehicle ambitions and private sector EV projects.
Export and value addition: Pakistan could export battery‑grade lithium products or target intermediate processing while building domestic refining capacity over time.
Job creation and industrial diversification: Exploration, drilling, processing and downstream manufacturing offer skilled employment and technology spillovers to related sectors.
Research and high‑value IP: The OGDCL‑Pinstech R&D program could develop IP in DLE adapted to high‑temperature South Asian brines, creating exportable technical services and licensing opportunities.
Comparable international precedents
Salton Sea, USA: Major geothermal brine lithium pilots combine high temperatures and mature geothermal infrastructure; developers pursue DLE pilots and integrated power‑plus‑lithium models.
Hellisheiði and other European pilots: Projects in Iceland and Europe focus on coupling geothermal power with lithium extraction using sorption and selective chemistry approaches.
These cases highlight the necessity of robust pilot testing, strong geochemical characterisation and careful scaling plans.
Investor checklist: what to ask OGDCL and partners
Data transparency: Provide detailed multi‑element assays, flowrate histories, temperature logs, and reservoir models.
Pilot performance metrics: Target DLE recovery rate, selectivity, production capacity (kg/day), and OPEX estimates under real field conditions.
Integrated economics: Present combined NPV/IRR sensitivity analyses for co‑production scenarios across lithium price ranges.
Timeline and milestones: Clear staged milestones from bench testing to pilot to commercial phase with capital estimates.
Offtake and downstream plans: Indications of offtake MOUs, refining partners, or domestic battery manufacturing commitments.
Regulatory and ESG plan: Environmental impact assessments, community engagement strategy, and reinjection/waste management design.
What success looks like for Pakistan
Confirmation of sustainable, economically recoverable lithium reserves at scale.
Mature DLE pilot with demonstrated recovery and manageable OPEX at field conditions.
Integrated geothermal power plus lithium operation delivering multiple revenue streams.
Domestic downstream capacity for battery‑grade lithium or stable export contracts that attract further investment.
A policy environment that supports rapid, responsible development while protecting local communities and ecosystems.
Short term next steps and timeline (practical)
0–6 months: Expanded brine sampling, complete geochemical characterisation, lab DLE screening, baseline environmental studies.
6–18 months: Pilot DLE deployment at the Wahid Bakhsh site or nearest high‑yield well, reservoir testing to confirm sustainable extraction rates.
18–36 months: Scaled pilot, feasibility study, bankable reserves, early commercial offtake agreements and discussions with downstream processors (domestic and international).
3–5 years: Commercial plant construction contingent on positive pilot and financing; parallel development of domestic refining or off‑take export agreements.
Conclusion: a pathway, not a guarantee
OGDCL’s discovery and the Pinstech collaboration position Pakistan at the start of a potentially transformative critical minerals pathway. The 275 mg/L finding is scientifically significant and opens practical options for integrating geothermal energy development with lithium production.
However, investors and policymakers should treat the news as an early but promising signal that requires rigorous resource confirmation, targeted R&D on extraction technologies and clear industrial strategy for downstream value capture. For stakeholders who act wisely , prioritising robust pilot data, environmental safeguards and strategic partnerships , Pakistan could emerge as a competitive new supplier of sustainably produced lithium.
sources: The News Pakistan
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