Does lithium boom loom on US horizon?

The start of ExxonMobil's new lithium production unit in southwestern Arkansas in mid-November highlights rapidly growing industry interest in producing the white mineral from the briny aquifers that proliferate in this region of the United States.

Lithium is a crucial component in the manufacture of batteries needed for electric vehicles, and demand for the white mineral is projected to quadruple by 2030.

ExxonMobil said its new unit is expected to begin producing the white battery metal by 2027 with an aim to become a global leader by 2030 with output that will eventually support the manufacture of more than one million EVs annually.

"Lithium is essential to the energy transition, and ExxonMobil has a leading role to play in paving the way for electrification," Dan Ammann, president of ExxonMobil Low Carbon Solutions, said in a recent statement.

Marketed as MobilTM Lithium, the new product's name builds on the rich history of deep technical partnership between Mobil and the automotive industry, the company said.

The project gained significant momentum earlier this year when ExxonMobil acquired more than US$100 million in mineral rights on 120,000 acres (48,563 hectares) from Galvanic Energy earlier this year.

The company said the purchase underscores its focus on securing substantial North American lithium deposits, while emphasizing a reduced environmental impact compared to traditional mining practices.

Spurred by incentives

The Inflation Reduction Act, signed by President Joe Biden in 2022, has spurred efforts to produce lithium domestically, manufacture batteries, and assemble electric cars in the United States with generous tax credits and other incentives.

But significant quantities of lithium in brine have been discovered in only a few places across the country.

One such place is the extensive, porous, and permeable limestone aquifer known as the Smackover Formation, a 40- to 60-mile-wide expanse shaped like an upside-down boomerang that extends from central Texas through southern Arkansas to the Florida Panhandle.

With a century of resource development that includes more than six decades of commercial brine operations for bromine extraction, and the highest reported lithium-in-brine values in North America, the formation is a potential lithium production powerhouse, experts say.

Bromine-rich brines found in wells in the Upper Jurassic Smackover Formation of Columbia County in southwestern Arkansas contain as much as 445 parts per million lithium. Lower values have also been reported in waters originating from some water wells and hot and cold springs scattered across Arkansas.

Except for lithium's potential as a by-product from the bromine brines in the Smackover Formation, some geologists question whether lithium concentrations of commercial potential exist in Arkansas.

Focus on extraction methods

Standard Lithium Ltd. is another company making strides in the region, having developed and operated a test lithium extraction facility in El Dorado, Ark., since May 2020. The company is now considering building a US$1.3 billion commercial plant.

Standard's initiative is bolstered by a partnership with global chemical company Lanxess, which provides infrastructure access and leverages direct-lithium-extraction technologies.

The proposed commercial lithium extraction plant would be located at the Lanxess South Plant southwest of El Dorado. Phase 1A of the project would include construction and operation of the plant via processing of tail brine from Lanxess, a subsidiary of Lanxess AG, which has exclusive brine extraction rights for 142,881 acres (57,823 hectares).

Standard Lithium recently completed a positive definitive feasibility study for phase 1A and expects to make a final investment decision in the first half of 2024, subject to continuing project definition, finalization of commercial agreements with Lanxess and project financing initiatives.

The study envisions average annual production of 5,400 metric tons per year of battery-quality lithium carbonate, with peak production of more than 5,700 metric tons per year during the project's 25-year operating life.

To prove its concept, Standard Lithium has operated an industrial-scale, fully integrated direct lithium extraction demonstration plant at the Lanxess South facility since May 2020.

Assuming final approval, plant construction would begin in 2024, with commercial production startup scheduled for 2026.

The bromine connection

Albemarle Corp. is also a contender with plans to expand its bromine operations to include lithium extraction. The company operates the Esmeralda County mine along with other global resources. The company's flagship projects, the Phase 1A project, and the Southwest Arkansas Project, are located in southern Arkansas near the Louisiana border.

For more than 100 years, the Smackover Formation in the southern U.S. played an important role in America's conventional energy economy. Since the 1950s, brines pumped from the Smackover Formation in Southwest Arkansas have been used for the recovery of bromine, a naturally occurring element used in agriculture and sanitation, as an alternative to chlorine in swimming pools, and as fire retardants.

Arkansas is the world's second-largest producer of bromine, and the bromine-rich brine also contains commercial concentrations of lithium. Standard Lithium has developed a fully integrated, start-to-finish, direct lithium extraction process to selectively extract lithium from Smackover brine and produce battery-quality lithium compounds.

With support from a U.S. Department of Defense grant, Albemarle is also working to adopt eco-friendly lithium brine extraction methods.

As these companies advance toward production, observers say Arkansas is poised to become a significant hub for lithium extraction, aimed primarily at the EV market.

A strong wager

ExxonMobil, meanwhile, is betting its expertise in geology, drilling, hydraulic fracturing, and chemical production will allow it to economically extract lithium from the Smackover brine.

The company says the thousands of depleted oil wells drilled in the region during the past century could eventually be rehabilitated to produce lithium.

The company plans to use direct lithium extraction technology to produce lithium from brine.

Engineers and executives who promote this method say it is superior to open pit mines or evaporation ponds because it is faster and wastes less water. But the process has yet to prove it can successfully produce enough lithium to be economically viable.

ExxonMobil also said it would pump leftover brine back underground and convert the lithium it mines to battery-grade material nearby.

While some energy experts question whether direct extraction will work at large scales and whether ExxonMobil's effort will significantly increase the supply of lithium, the company's executives say they are confident the technology will work.

"This landmark project applies decades of ExxonMobil expertise to unlock vast supplies of North American lithium with far fewer environmental impacts than traditional mining operations," Amman said.

One reason for this confidence may stem from the company's long history in lithium research. In 1973, Exxon chemist Stanley Whittingham played a leading role in developing the lithium-ion battery. Exxon even manufactured the batteries but gave up in the mid-1970s, having concluded the market for the innovation was too small. For his contribution, Whittingham won the Nobel Prize in 2019.