Exxon Mobil has announced plans to emerge as a prominent lithium producer for electric vehicle batteries by initiating a drilling operation in Arkansas.
Earlier in the year, the company acquired 120,000 acres of a geological reserve in southern Arkansas known as the Smackover Formation, abundant in lithium. Production of lithium for batteries should begin in 2027, and the company’s goal is to provide enough of the mineral for one million electric vehicles annually by 2030.
Exxon said in a statement that talks are underway with potential buyers such as electric vehicle and battery manufacturers. The lithium operation comes when major oil companies have to address climate change.
While BP and Shell concentrate on renewable energy like wind and solar, Exxon is committing $17 billion by 2027 to lower emissions. Exxon said that increasing domestic lithium production is key to the energy transition, adding that it sees it as a multi-decade investment.
Imports from South America
The US mainly relies on lithium imports from Argentina and Chile, although according to the US Geological Survey, they have some of the largest mineral deposits. The US currently has only one commercial lithium production site in Nevada.
The demand for lithium batteries in the US should increase sixfold by 2030 due to the mass shift to electric vehicles. Sales of electric vehicles in the US increased by 50 per cent in the third quarter of the current year, and it is estimated that about one per cent of the total vehicles in the country consist of electric cars.