The Startup Trying to Wrest Gallium Production Away From China

When John Busbee started his battery technology company in 2010, his strategy was about making just one small part that could be widely used by other manufacturers. He launched Xerion Advanced Battery Corp. at a University of Illinois startup incubator in a bid to commercialize a novel breakthrough in nanostructured foam for the internal components of batteries.

That same logic has since led the company to produce other key materials for the energy transition, including cobalt and, now, gallium, Heatmap has learned.

The same year Busbee started Xerion, some 7,000 miles west across the Pacific, China cut off shipments of rare earth metals to Japan amid a geopolitical spat over contested islands. The move shocked the democratic world and made apparent a troubling fact — that over the preceding few decades, China had seized nearly full control of the global supply of these key metals for magnets and electronics. In the years since, Beijing has used export restrictions on rare earths and other minerals to the U.S. and its allies as a geopolitical cudgel, leading Busbee and others to look for ways to rewire global supply chains away from China.

Xerion had previously experimented with molten salt electrolysis, a process that involves running an electrical current through salt that’s been heated to somewhere from 800 to 1,600 degrees Fahrenheit — hot enough to achieve a liquid state, corrosive enough to eat through rock ore but leave behind the desired metals.

Ultimately the team at Xerion found that this method could be used to process cobalt, which is sourced mostly from Chinese-controlled mines in the Democratic Republic of the Congo. The molten salt would eat away at the igneous rock containing the bluish battery metal, leaving behind the mineral. The company opened its pilot cobalt-refining facility in Dayton, Ohio, in April, and reached its goal of producing 5 metric tons for the year.

Now Xerion is expanding into producing gallium. The U.S. has no domestic industry to produce the soft, silvery metal, and imports of the raw material – widely used in solar cells, nuclear sensors, electric vehicle batteries, and semiconductors – have skyrocketed by nearly threefold since 2020. China banned exports to the U.S. in December.

“Gallium was low-hanging fruit,” Busbee told me. “It’s in all the radars. It's in all the missiles. It’s in all the planes. All the new chargers that are really compact are made with gallium nitride. It’s also in the cell phones. And it’s something where China has the market cornered.”

The U.S. stopped producing its own gallium in 1987, according to a U.S. Geological Survey report. Before then, the metal came as a byproduct of turning bauxite into aluminum; in China, where the vast majority of global production moved, the government requires alumina refineries to also extract gallium. As alumina processing disappeared in the U.S., there was no market incentive for refineries to invest in the complex process of also extracting gallium, which makes up a tiny fraction of 1% of the total bauxite ore.

At least one major proposed rare earths mine in the U.S., the Sheep Creek site in Montana, boasts large deposits of gallium, and U.S. Critical Materials Corp., the project’s Salt Lake City-based developer, inked a deal to work on building a pilot plant to test its own refining technology with the Idaho National Laboratory this summer. But the project is still at an early stage.

The benefit of using molten-salt electrolysis, Busbee said, is that it provides a shortcut. “I tell people I’m kind of dumb and stubborn,” he said. “What I mean by dumb is that I wasn’t in the industry, so I didn't know that it was widely known that you don’t use this method because it’s so aggressively corrosive that it’s a pain in the butt. And by stubborn I mean that, once we picked that, we stuck with it and spent 10 years optimizing these incredibly corrosive molten salts for the battery space.”

Since the molten salt will eat through nearly everything the Ohio-based Xerion isn’t looking to collect, the process can pull gallium out of mining waste and other sources with low concentrations of the metal.

“It’s a one-step process,” Busbee told me. “A lot of people dissolve in acid, then have to evaporate it and recrystallize it. Sometimes there are multiple rounds. There can be 15 to 100 steps. Ours is one step.”

Asked what the catch might be, Busbee laughed. “It’s been a pinch-me technology,” he said. “As we keep going further, we keep finding good things.”

There’s still some waste rock left behind after the process, and the company said it’s figuring out useful ways to sell that material.

Despite its 15 years in operation, Xerion’s bid to enter the critical minerals market is new enough that many analysts were unfamiliar with the company and its approach. BloombergNEF declined to comment. Benchmark Mineral Intelligence, the London-based battery metals consultancy, cautioned that Xerion’s claims of “very high recoveries” of materials “seems to be in a lab environment rather than at scale.”

“With respect to Xerion’s original cobalt line, my understanding is this is still at pilot stage, so difficult to compare against industry production,” William Talbot, the lead cobalt analyst at Benchmark, told me via email.

But Ryan Alimento, an energy analyst at the Breakthrough Institute, said the ability of molten salt to refine minerals to much higher concentrations than water-based solutions is real.

“The advantage of molten salt is exactly what Xerion says,” he told me. Still, he said, opening a pilot plant is just “the first stage in the entrepreneurial valley of death.”

“There’s still a lot more steps needed along the way,” Alimento said. “When you have a company introducing a new processing technology like this that really diverts from the norm, it requires a lot of capital.”

Xerion has raised “a little over $100 million” from venture capitalists and family offices, Busbee said. As the company moves into manufacturing, however, he told me he plans to tap into more large institutional investors. That may offer some promise. Critical minerals are undergoing something of a dealmaking boom as investors clamber for stakes in companies whose metals could win the bonus tax credits the Biden administration offered for domestically-produced materials or avoid the trade penalties the Trump administration has slapped on imports from adversary nations.

President Donald Trump has also used the military to invest directly into rare earths production. The Department of Defense bought a stake in MP Materials, the only active rare earths producer in the U.S., in what The Economist described as the federal government’s biggest intervention in a private company since nationalizing the railroads during World War I. While it’s not a direct ownership stake, the federal Defense Logistics Agency earlier this month awarded Xerion funding through the Small Business Innovation Research program to carry out tests on the economic viability of its technology. Xerion said it expects to complete the first phase of the testing in the first quarter of next year, and plans to pursue grants for the second and third phase analyses.

“This is definitely a priority for the U.S., which is good because what companies need is unambiguous and long-sustained government support for something like this,” Alimento said. “It does not surprise me that a company like Xerion would be thriving in this kind of industrial-policy ecosystem.”