Exxon Mobil revealed its ambitious plan on Monday to commence lithium production from subsurface wells by 2027, a strategic move aimed at securing a vital supply for electric car batteries and advanced electronics. The oil giant’s foray into lithium extraction underscores the increasing focus of major energy players on the electrification sector in response to rising governmental initiatives promoting electric vehicle (EV) adoption and a reduction in fossil fuel consumption.
Lithium production for EVs and beyond
Exxon intends to initiate lithium production from briny waters extracted from lithium-rich deposits in Arkansas, marking a crucial step towards establishing a domestic source of this essential metal. The company plans to contribute lithium supplies for over 1 million electric vehicles annually, aspiring to become a leading global supplier of the metal by 2030. The goal, estimated to necessitate around $2 billion in capital expenditures, aligns with the escalating demand for lithium in EV batteries and other applications.
Production techniques and partnerships
Exxon will employ conventional oil and gas drilling methods to access lithium-rich saltwater from underground reservoirs, utilizing direct lithium extraction (DLE) technology for separation. The company’s partnership with Tetra Technologies for production, as exclusively reported by Reuters, reinforces its commitment to expanding its presence in the lithium market. The metal produced will be marketed under the brand name Mobil Lithium.
Strategic acquisition and global outlook
Earlier this year, Exxon secured rights to 120,000 gross acres in the Smackover Formation in Arkansas, strategically positioning itself in an area rich in lithium brine potential. While acknowledging the global opportunities for lithium, Exxon’s President of Low Carbon Business, Dan Ammann, emphasized the urgent need for domestic production to address critical material requirements promptly.
Divergence from EV charging stations
In contrast to European counterparts BP and Shell investing in EV charging stations, Exxon has no plans to enter this space. Exxon aims to focus on supplying lithium for various applications, including EV batteries, consumer electronics, and energy storage systems that play a crucial role in harnessing intermittent renewable energy.
Exxon’s strategic move into lithium production aligns with the global shift towards electric mobility. By securing a robust lithium supply chain, Exxon positions itself as a key player in meeting the burgeoning demand for electric vehicles and related technologies, recognizing the immense potential presented by the ongoing transition in the automotive landscape.