Optimizing Lithium Production Decisions under Geological, Demand, and Pricing Uncertainties: A POMDP Framework for Multi-Objective Decision Making

Decision making in lithium production is challenging, whether from an investor's perspective or a strategic production standpoint. Determining which mines to open and when to open them involves not only geological and price uncertainties, but also complexities around the choice of extraction method, from direct lithium extraction to hard rock mining. Prior work explored models of this problem and different methods to optimize mining decisions; these models did not account for uncertainty in pricing, uncertainty in demand, or different mining technologies to extract lithium. Incorporating different pricing models and extraction technology into these models enables more robust strategies for determining not only when and where to open a mine, but also which method of production to pursue. We frame the problem as a partially observable Markov decision process (POMDP) and solve using belief state planning methods to get optimal decision making. In our study, we show that POMDP solvers outperform human inspired heuristics by dynamically adapting to shifting lithium price regimes (static, linear, exponential, and stochastic) through belief state planning and explicit uncertainty management. By optimally sequencing exploration, production, and technology choice, the framework achieves higher demand fulfillment and more balanced economic environmental outcomes over the projects lifetime in all different pricing and deposit scenarios.

Compositional Boundaries for Density Fusion

Distributed uncertainty-management systems often combine local probabilistic models along aggregation trees chosen by communication, privacy, or scheduling constraints. The final density should depend on the weighted sources, not on the particular order in which intermediate nodes combine them. We study this requirement as an algebraic compositionality problem for binary fusion of weighted probability densities. The central question is when a local fusion rule can be executed hierarchically while remaining order-invariant. We establish a compositional boundary for local segment-valued fusion rules. Within the class of continuous binary rules with additive output weights and weight-only coefficients, order-invariant hierarchical execution characterizes normalized weighted linear pooling; norm-induced segment balancing realizes the corresponding coefficient. Smooth endpoint-to-candidate $f$-divergence balancing has a different local geometry: its quadratic expansion induces square-root effective weights, showing why pairwise solvability alone is insufficient for schedule-independent fusion. We show that this obstruction is local to endpoint-to-candidate binary balancing, whereas global divergence barycenters retain additive-weight local limits. Finally, Gaussian mixtures show how the same issue appears in finite model classes: exact fusion is compositional, whereas stepwise compression is compositional only under a congruence condition on unnormalized component measures. These results distinguish exact schedule-independent fusion from global aggregation objectives and local approximation heuristics.