- Exxon Mobil is looking to break into the EV battery lithium supply market, developing a drilling site and processing plant for the material in southwest Arkansas.
- The oil and gas company aims to begin producing lithium from its 120,000-acre deposit site in Smackover, Arkansas, in 2027. It acquired the site earlier this year.
- Mobil Lithium, as the company dubbed the new offering, set a target to supply more than one million EVs per year by 2030, but it has not named any potential customers.
Lithium production is a shift for Exxon Mobil. The company is one of the world's largest oil producers, pumping out 1.9 million barrels of crude oil per day in the U.S. alone.
The company will use traditional conventional oil and gas drilling methods to access lithium-rich saltwater from the Smackover site's reservoirs, before extracting the critical mineral from the saltwater. It will then be processed onsite to battery-grade material.
"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," Dan Ammann, president of ExxonMobil Low Carbon Solutions, said in a statement.
Exxon Mobil has been moving quickly with the project, gaining the rights to the Smackover land in early 2023. The area is well-known for its rich lithium reserves, containing as much as 445 parts per million lithium, according to the state.
Other companies, such as lithium producer Standard Lithium, have also established production projects on the land.
Arkansas lithium production will help grow the U.S.'s currently small domestic capacity for the critical mineral. The country is currently only home to one active lithium lithium project in Nevada, while companies like Tesla and GM are investing in the area to grow production capacity.
Exxon Mobil is not entirely new to the renewable energy business — the company has been investing in biofuels for years. The oil giant partnered with Porsche in 2021 to test biofuels, and took a 49.9% stake in Norwegian biofuel company Biojet AS in January 2022.
The company did walk away from its investment efforts in algae-based biofuel earlier this year, however, after more than a decade in the space, Bloomberg reported. Exxon Mobil did so in a pivot to focus on other renewable energy solutions, the company said.
With a wary eye on the shift to EVs and the threat it presents to their core business, some oil giants have realized their drilling capabilities are well-suited to the lithium extraction necessary to build EV batteries.
In July, Chevron CEO Mike Wirth told Bloomberg that the oil company is considering opportunities for lithium production to supply EV batteries. Wirth didn't offer details on what those opportunities could be, but he noted lithium extraction fits well within Chevron's "core capabilities."
Shell hasn't announced any lithium production plans this year, but has heavily invested in wind energy, including with a February 2022 purchase for wind farm acreage in New York.