ExxonMobil Lithium Global Business Manager Patrick Howarth on Thursday detailed some of the oil and gas giant's plans to pump lithium from deep below the ground in south Arkansas and promised to explain the extraction technology the company will use by the end of the year.
Howarth was one of the speakers at the first Arkansas Lithium Innovation Summit, held at the Robinson Center.
Howarth and others said Thursday that the direct extraction of lithium being tested in Arkansas has financial potential and can compete with the other established forms of producing the metal: extracting it from mined ore and evaporating it from surface brine reservoirs. Pumped up from new or preexisting wells, the brine runs through resins that extract the lithium at a surface-level production facility, then the brine is pumped back thousands of feet underground.
ExxonMobil aims to produce enough lithium to power 1 million electric vehicles a year by 2030. The corporation acquired the rights to 120,000 acres in south Arkansas in 2023, when it began a seismic survey and engineering design work, and announced its first well drilling in November. Exxon expects to be producing lithium in 2027.
"We bring capital, we bring skills, and we bring experience, whether that's producing affordable and reliable energy the world needs today or the new businesses of the future," Howarth said. "We plan to spend over $20 billion pursuing lower-emissions opportunities between 2022 and 2027. These include new businesses like [carbon capture and storage], hydrogen and, of course, lithium."
Accessing Smackover brine requires geoscience and reservoir engineering capabilities ExxonMobil already has, Howarth said. He called direct lithium extraction, which has yet to have been shown to be financially viable, "one small part of an overall integrated process flow."
"At pilot scale, most work, but the challenge is around commercializing it, how you integrate that technology with all the other elements within that process flow to be able to produce product people need safely and reliably," he said. "That's the reason there isn't a facility that looks like this anywhere on the planet today: it's hard. But it's these types of operations, this type of work that ExxonMobil does every single day."
He said ExxonMobil has spoken to motor vehicle and battery manufacturers who say Arkansas' lithium is desperately needed and that the state has the political leadership needed to build the industry here.
"We need to continue to build out regulations so that they're predictable and efficient, and we need fiscal competitiveness. The fiscals in Arkansas need to be clear, be certain and be competitive," he said. "Projects that we're trying to bring online here, we're competing against projects from California to Chile to China."
Howarth also announced the ExxonMobil Charitable Endowment for Southwest Arkansas, an initial $100,000 for education, quality of life and public safety in Lafayette and Columbia counties.
Arkansas has long been a bromine producer, as brine from wells tapped for oil 100 years ago is rich in the element (as well as lithium; Standard Lithium, another company seeking to create a direct lithium extraction industry in the state, is using brine from existing wells for its own pilot production).
The state has an existing regulatory structure for the bromine industry. For lithium, Commerce Secretary Hugh McDonald said Arkansas needs to establish a fair, predictable and competitive royalties structure as well as power, water, sewer and transportation infrastructure, housing and a workforce -- Arkansas Tech University has a revamped major in geosciences -- and called the state's defense, steel, logistics and transit industries complimentary.
Gov. Sarah Huckabee Sanders said development of an Arkansas lithium industry would benefit a country that currently imports most of its lithium. "Energy independence is absolutely critical, whether it's talking about oil, gas or lithium," she said. "Most importantly, we can provide good, steady jobs for many Arkansans."
Sanders and 15 other Republican governors wrote to President Joe Biden last month, however, urging him to alter his administration's regulations that would require two-thirds of sold vehicles be electric by 2032, saying consumer demand alone should drive sales. The governors also wrote that there should be "the necessary infrastructure to support battery electric vehicles," including through bolstering the domestic critical minerals industry.
"Even if consumers determine over time that battery electric vehicles are appealing, the reality is that the lack of a strong, domestic marketplace makes electric vehicles prohibitively expensive for the American consumer," they wrote. "While battery electric vehicles are a promising technology, we believe it will take time to develop the marketplace, to address consumer access and concerns, and to build out the necessary infrastructure."
To that end, the U.S. Energy Department is investing $6 billion in Bipartisan Infrastructure Law funding for battery material processing and manufacturing, almost half of which has already been awarded to 15 projects. The Bipartisan Infrastructure Law also includes a $2.5 billion Charging and Fueling Infrastructure Discretionary Grant Program and a $5 billion National Electric Vehicle Infrastructure formula program.
While manufacturer grants and tax incentives are in effect to create higher demand for electric vehicles, car builders have reported slacking demand. The Biden administration's actions in this area are part of its climate change mitigation strategy.
"From an environmental standpoint, we do understand that we need to continue to focus on renewables and alternative energy resources," Arkansas Energy and Environment Secretary Shane Khoury said during the summit. "But we also understand that we need to make sure that our policies and regulations are reasonable and make sense, do what they're intended to do without stymying economic development and/or limiting our ability to produce traditional conventional energy resources."
"There's a time and a place for renewables, but there's also a time and a place for our conventional energy resources," he said. "And I think most of us in this room recognize that we are not at a point where we can move away from our conventional energy resources, at least without jeopardizing our affordability, efficiency and energy security that we need here in our country."
In an interview, McDonald said, "There's a 20-, 30-, 40-year transition to move off of fossil fuels. You just cannot do it by 2030, 2040. We've got fossil fuels in this world for a long time, but we also have an opportunity here in the state that can change the landscape by helping support a domestic supply of lithium."
The Paris Climate Accords mandate that state parties cut their emissions in half by 2030. Asked about the gubernatorial administration's conception of climate change mitigation from competitive and systemic perspectives, McDonald reiterated that an energy transition is underway, noting that an all-of-the-above energy strategy includes renewables.
Vancouver, British Columbia-based Standard Lithium and two Arkansas bromine producers, Charlotte, N.C.-based Albemarle and Pasadena, Calif.-based Tetra Technologies, presented the summit alongside ExxonMobile.
Standard Lithium Chief Executive Officer Robert Mintak said in an interview that lithium is a challenging market, noting its price bubble in the early 2010s and price rollercoaster later in the decade. But he said his company's domestic production holds appeal.
"We're seeing that fluctuation," he said. "You've got to keep your eye on the ball. We're going to see these fluctuations; the U.S. needs these projects to be built. The significant interest from investors and groups, off-take project participation, who look at these opportunities as the best time to get in. Pick a horse that has a strong chance of getting to the finish line."