© Reuters. FILE PHOTO: ExxonMobil brand is seen on this illustration taken, October 6, 2023. REUTERS/Dado Ruvic/Illustration/File Photograph
By Ernest Scheyder
(Reuters) -Exxon Mobil is ready to unveil its long-awaited lithium technique on Monday with an announcement that it goals to start out manufacturing of the electrical automobile (EV) battery metallic in Arkansas by 2026, in accordance with a supply with direct data of the oil main’s plans.
Exxon (NYSE:)’s growth into the sector comes as rising applied sciences intention to spice up world manufacturing of the ultralight metallic by filtering it from salty brine deposits discovered throughout the globe and supplying it to battery makers longing for recent sources.
Exxon, which invented the lithium-ion battery within the Seventies however stepped away from the expertise, plans to start producing no less than 10,000 metric tons per 12 months of lithium in Arkansas by 2026 with companion Tetra Applied sciences (NYSE:) in what has been labeled “Challenge Evergreen,” in accordance with the supply.
That preliminary manufacturing can be roughly equal to the quantity wanted to provide 100,000 EV batteries.
Reuters reported this 12 months that Exxon had agreed to develop greater than 6,100 lithium-rich acres in Arkansas with Tetra, which produces chemical compounds for water therapy and recycling.
Exxon has been drilling wells in Arkansas this 12 months to check the huge Smackover Formation, a geological formation stretching from Florida to Texas that teems with lithium- and bromine-rich brine. The corporate has additionally been testing unproven direct lithium extraction (DLE) expertise that might be essential for business operations, in accordance with the supply, who was not approved to talk publicly.
An Exxon spokesperson declined to remark. A consultant for Tetra was not instantly out there to remark.
For Exxon and different oil corporations, lithium manufacturing presents the prospect of promoting a brand new product with comparatively little added value. Darren Woods, Exxon CEO since 2017, instructed traders throughout a name on Oct. 4 that the lithium sector was “pretty promising.”
He additionally stated: “We see a chance to essentially leverage the issues that we’re fairly good at.”
Exxon, like different fossil gas producers, has confronted strain to scale back carbon emissions from operations. Reuters reported this 12 months that Exxon shareholder Engine No. 1 had pressured the corporate to deploy DLE.
Exxon isn’t anticipated to publicly announce which DLE expertise it has chosen, in accordance with the supply. The corporate has a long-standing sample of not disclosing some distributors.
Reuters reported this 12 months that Exxon and Chevron (NYSE:) held talks with Worldwide Battery Metals and EnergySource Minerals about licensing DLE expertise.
OTHER ACREAGE
Separate from its Tetra partnership, Exxon additionally controls greater than 100,000 acres in Arkansas from which it plans to start lithium manufacturing by 2027, in accordance with the supply.
Exxon acquired that acreage this 12 months from privately held Galvanic Vitality, Reuters reported.
It was not clear whether or not Exxon plans to broaden lithium operations exterior Arkansas. Like all oil producers, Exxon extracts water containing traces of lithium as a part of fossil gas manufacturing. That might assist the oil trade morph into the world’s largest lithium provider, if DLE applied sciences will be commercialized.
Exxon, like Albemarle (NYSE:), Normal Lithium and others aiming to provide the battery metallic in Arkansas, face a key regulatory roadblock. The southern U.S. state, simply north of Louisiana, has a royalty construction for bromine, which Albemarle has lengthy produced there, however not for lithium, which might delay growth within the brief time period.
The Arkansas Oil and Fuel Fee, which abroad lithium operations within the state, has stated it plans to carry hearings on the matter.
Exxon plans to ship no less than six representatives to the Benchmark Minerals convention subsequent week in Los Angeles, in accordance with an attendance listing seen by Reuters. It might mark the corporate’s first attendance on the main vital minerals convention.