Exxon Mobil plans to produce lithium in Arkansas| Trending Viral hub

Exxon Mobil said Monday it plans to establish a facility in Arkansas to produce lithium, a critical raw material for electric vehicles, which poses one of the biggest challenges to the company’s oil business.

The announcement, which comes just a month after Exxon said it would spend $60 billion to buy Pioneer Natural Resources, signals that the oil major intends to hedge its big bets on conventional fossil fuels with at least some investments in cleaner forms of energy that are necessary to combat climate change.

The announcement does not represent a fundamental change in corporate strategy, but is an acknowledgment that battery-powered vehicles will increasingly compete with gasoline- and diesel-powered cars and trucks. It could also open the door for southern Arkansas to emerge as a major source of lithium. Most of today’s metal comes from Australia and South America and much of it is processed in China.

“Electrification will be an important component of the energy transition and we bring very relevant experience to lithium production,” Dan Ammann, president of Exxon Mobil Low Carbon Solutions and former senior executive at General Motors, said in an interview. “We see an implementation opportunity that will be very profitable.”

He said the project would “enable the continued reduction of emissions associated with transportation.”

Exxon announced it would begin lithium production in 2027, with the goal of producing enough metal to supply more than one million electric vehicles a year by 2030. The company did not say how much it would invest in the project, but Ammann said the company was willing to spend “hundreds of millions” to start and would look for “more opportunities” to expand lithium production.

An essential component of lithium-ion batteries, lithium has become a prize in a global race between American companies and businesses in China, Russia and elsewhere. The United States only produces a small amount of lithium, although mining companies hope to produce much more. including in California, Nevada and North Carolina.

Exxon executives say the company’s expertise in geology, drilling, hydraulic fracturing and chemical production will allow it to economically extract lithium from the soup of salt water and minerals known as “Smackover brine” found underground in Arkansas. . Exxon added that thousands of depleted oil wells drilled over the last century could eventually be rehabilitated to produce lithium.

In recent years, Exxon has doubled its oil and natural gas production in the Permian Basin that straddles Texas and New Mexico and in the deep waters off the coast of Guyana. Arkansas fits into its plans to concentrate its production close to home and away from the Middle East and Russia, where Western oil companies previously tried, unsuccessfully, to establish sustainable businesses.

Some other oil companies such as BP, Eni and Equinor have invested in other forms of energy such as solar, nuclear and wind, but Exxon has sought to increase its investments in fossil fuels while trying to step up efforts to capture and bury carbon emissions. carbon from industry and produce hydrogen as a clean fuel.

In Arkansas, Exxon plans to use a process known as “direct lithium extraction,” a new technology that uses solvents or membranes and filters to produce lithium from brine. The engineers and executives pushing this method have said it is superior to open-pit mines or evaporation ponds because it is faster and wastes less water. But no one has successfully demonstrated that this approach can produce enough lithium for millions of cars or stationary batteries.

Exxon, which bought drilling rights to 120,000 acres in Arkansas this year, said it would pump excess brine underground and convert the lithium it extracts into material suitable for batteries nearby. China dominates the difficult business of converting lithium found in the earth into the concentrated material needed by battery factories.

Some energy experts are skeptical that direct extraction will work on a large scale and have said Exxon’s effort might not increase lithium supply much. Ammann said he was confident the technology would work.

Some environmentalists expressed lukewarm praise for Exxon’s lithium efforts.

“It’s an infinitesimal fraction of what Exxon does and most of what it does is terrible,” said Dan Becker, director of the climate safe transportation campaign at the Center for Biological Diversity. “But we need lithium, and it’s better for it to come from a run-down industrial site where oil drilling used to take place than from a pristine place.”

The Inflation Reduction Act, signed by President Biden last year, has helped boost efforts to produce lithium, manufacture batteries and assemble electric cars with generous tax credits and other incentives.

Still, there has been little new lithium production in the United States in recent years, and experts say establishing mines and processing plants here could take many years. Some companies have been working for years to produce lithium from brine under the Salton Sea in California.

“It’s helpful, but it won’t be enough to get critical metals independence out of China,” said Benny Freeman, a chemical engineering professor at the University of Texas at Austin who is active in lithium research. “But this, plus the Salton Sea, is a good start.”

Mining experts said Exxon had the expertise to find lithium, but might need outside help to separate the metal by filtration or purifying the salty liquids.

Exxon has been in talks with Tesla, Ford Motor and other car companies to supply them with lithium. Other oil companies, including Chevron and Occidental, have also said they are considering investing in lithium mining.

In some ways, Exxon’s new venture into the lithium sector is a return to its past. In the 1970s, an Exxon chemist played a leading role in the development of the lithium-ion battery. Exxon even began manufacturing batteries in 1976, but abandoned after concluding that the market for batteries was too small.

The price of lithium has been falling in recent months as new supplies have become available in several countries and the growth rate of electric vehicles has slowed in China, Europe and the United States. But many energy experts expect a shortage of the metal by the end of the decade, which could result in higher prices.

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