Indonesia has launched its first geothermal lithium extraction project, marking a significant evolution in the nation's strategy to dominate global critical minerals markets beyond its current nickel stronghold.
State-owned geothermal operator Geo Dipa Energi has partnered with California-based Lilac Solutions to extract lithium from geothermal brine at the Dieng geothermal field in Central Java, according to the Jakarta Globe.
The partnership represents a technological breakthrough that could unlock Indonesia's vast but previously inaccessible lithium resources. Unlike conventional lithium mining, which requires hard rock extraction or evaporation ponds, direct lithium extraction (DLE) from geothermal brine offers a more environmentally sustainable approach with significantly faster production timelines.
Lilac Solutions will deploy its proprietary ion exchange technology to separate lithium from the hot, mineral-rich water produced during geothermal energy generation. This dual-use model allows Indonesia to simultaneously generate renewable electricity and produce battery-grade lithium from the same resource—a compelling value proposition for a nation committed to both energy transition and industrial development.
Indonesia sits on the Pacific Ring of Fire, giving it the world's second-largest geothermal energy potential after the United States. The archipelago operates numerous geothermal plants, but until now, the lithium dissolved in geothermal fluids has been an untapped resource. If the Dieng pilot proves commercially viable, it could be replicated across Indonesia's 300-plus volcanic sites.
The project aligns with President Prabowo Subianto's downstreaming agenda, which seeks to transform Indonesia from a raw materials exporter into a value-added manufacturing hub. has already leveraged its nickel dominance to attract major electric vehicle battery investments from Chinese, South Korean, and European manufacturers.
