Prairie Lithium Puts Canada’s Battery Hopes to the Test

Canada’s direct lithium extraction projects shift from pilots to full-scale builds, signaling a new phase for domestic battery supply

26 Jan 2026

Canada’s effort to build a home-grown lithium supply is entering a more serious phase. In Saskatchewan, construction has begun on what is billed as one of North America’s largest direct lithium extraction (DLE) facilities. After years of pilot tests, a technology long praised in theory is being asked to perform at scale.

The project marks a shift in ambition. Rather than exporting raw materials or relying on distant producers, Canada wants lithium production closer to North American battery and electric-vehicle plants. With demand for batteries rising and global supply chains proving fragile, the appeal is clear. What has been uncertain is whether DLE can move beyond trials.

Unlike open-pit mines or vast evaporation ponds, DLE pulls lithium from underground brines. Supporters argue that it is faster, uses less land and consumes less water. Yet many methods that worked in short tests have struggled when run continuously. Prairie Lithium’s plant aims to close that gap. Foundations are being laid, and commercial-scale extraction columns are due to start operating in 2026.

Geography helps. Saskatchewan’s long-established oil and gas industry provides wells, pipelines and power connections that can be reused. As one market analyst tracking the project noted, “this approach adapts existing assets for the energy transition”, lowering costs and shortening timelines. That reuse may be what makes commercial deployment plausible.

Elsewhere, similar efforts are under way. LithiumBank is pushing brine projects in Alberta with government support. E3 Lithium continues to refine its technology and partnerships. None is yet producing lithium at full commercial scale. Taken together, though, they suggest Canada is trying to become a future supplier, not just a site of exploration.

For carmakers and battery firms, the prize would be a steadier local source of a critical input. Any benefit remains some years off, and success depends on smooth ramp-ups. Technical failures, cost overruns and scrutiny of underground water use all pose risks.

Still, the mood has shifted. As one industry executive put it, “the real test is no longer theory but daily operation.” If these projects work, they could draw capital and confidence, and give Canada a firmer place in North America’s battery economy.