Exxon hopes to dominate the lithium market for electric vehicles by 2030.
In Arkansas, Exxon Mobil intends to start producing lithium in 2027.
Exxon Mobil Corp. announced intentions to start extracting lithium in Arkansas, which will be the company’s first big non-fossil fuel extraction project in recent memory and a foray into the supply of a crucial component of large-scale batteries.
Exxon, a Spring, Texas-based corporation, announced in a statement on Monday that it had purchased the rights to 120,000 acres in the Smackover formation in southern Arkansas and intended to start producing lithium by 2027. Exxon will become a “leading supplier for electric vehicles by 2030,” according to the report.
Several oil and gas firms, including Exxon, are attempting to enter the lithium business in order to gain a foothold in the quickly expanding energy storage sector. Utilizing metal in batteries for electric vehicles would also help offset losses from the anticipated decline in demand for gasoline and diesel during the ensuing decades.
“ExxonMobil has a leading role to play in paving the way for electrification, and lithium is essential to the energy transition,” stated Dan Ammann, head of Exxon’s Low Carbon Solutions division.
According to Bloomberg News in July, which cited people familiar with the topic, the oil giant has held conversations with Tesla, Ford, Volkswagen, and other manufacturers this year as it looks to develop a company around the metal.
While lithium is not as geologically rare as cobalt and nickel, two other battery metals, mining large amounts of high-grade lithium is a significant difficulty. According to Exxon CEO Darren Woods, making it from brine or saltwater could be more environmentally friendly and less expensive than mining, which is the process that is now used most often.
Exxon thinks its experience in drilling and processing liquids can give the business a competitive edge in getting lithium from subterranean saltwater reserves, even though operations are still in their early stages. According to Woods, the prospect of producing lithium from Arkansas’s Smackover Range is “more and more promising” as of last month.
This year, spot lithium prices have fallen sharply as a result of China’s downturn and worries about the affordability of electric cars in the US and Europe. However, the long-term outlook appears favorable. By the end of the decade, BloombergNEF projects a nearly five-fold increase in the world’s lithium demand.
The largest oil-services company in the world, SLB, and Occidental Petroleum Corp. have both stated that they are investigating brine-based lithium production.
Back to Blog