From Waste to Wealth? How Water Is Powering a US Lithium Pivot

A Texas partnership turns produced water into lithium supply, hinting at new revenue models for water assets and a shift in domestic sourcing

10 Feb 2026

For years oil and gas firms have paid to get rid of produced water, the salty byproduct that comes up with hydrocarbons. In Texas a new partnership suggests that nuisance may yet earn its keep.

Select Water Solutions, a water-services firm, and LibertyStream Infrastructure Partners, an investor, plan to bolt lithium recovery onto existing treatment facilities. Rather than build new extraction plants, they will tap into systems already processing vast flows of wastewater. The appeal is plain: lower upfront costs, quicker deployment and fewer regulatory tangles.

The moment is ripe. Demand for lithium is rising fast as electric vehicles, batteries and grid storage spread. Yet America still imports most of what it uses, leaving manufacturers exposed to price swings and supply shocks. Extracting lithium from water that is already being handled offers a way to add domestic supply without drawing on scarce freshwater or opening new mines.

The deal also hints at a shift in how water assets are seen. Executives involved argue that treatment plants need not be dull utilities. With the right add-ons, they can become platforms for recovering valuable materials. Some analysts think this could make the sector more attractive to industrial firms and investors who have long prized water infrastructure for its steady returns, but not for growth.

The idea fits a wider trend. Across energy and environmental services, companies are looking for projects that marry environmental aims with profits. Private capital, wary of risk but hungry for yield, has been gravitating towards assets that promise predictable cash flows with a chance of extra upside. Lithium from produced water sits neatly in that space.

Obstacles remain. Lithium prices are volatile. The concentration and chemistry of the metal vary sharply from basin to basin. Regulators are still learning how to oversee new recovery techniques. For now the partners plan to stick to familiar permits and focus on proving that lithium can be pulled out efficiently at scale. They aim to open a first commercial facility by late 2026.

If the experiment succeeds, its reach could extend well beyond Texas. Similar systems could be grafted onto water treatment across other oil and gas regions. What was once an unwanted byproduct might become a useful feedstock for the clean energy economy. An industry long thought defensive may be edging towards reinvention.