It isn't just Bill Gates who's making a long-term bet on mining for EV metals: oil supermajor Exxon has joined the party, announcing this week that it is beginning to drill for lithium in Arkansas and that it hopes to become a major U.S. supplier for EV battery makers by 2030, according to a new report by the Wall Street Journal.
Though the Journal made mention of the idea back in May when the company bought drilling rights on 120,000 acres in southwest Arkansas for more than $100 million, Exxon let the public in on its longer-term plans for the first time on Monday.
The company announced its commencement of lithium drilling in the Smackover region of Arkansas, with intentions to begin production of battery-grade lithium by 2027, per the report.
Exxon will brand the new product Mobil Lithium.
The Journal reported that lithium prices have dropped by over 60% this year due to increased market supply and a slowdown in EV sales growth. But short-term moves in lithium prices have not deterred Exxon, which has a longer-term outlook on their objective.
Exxon aims to supply lithium for over 1 million EVs annually by the decade's end, with plans for global expansion and ongoing discussions with battery and EV manufacturers.
Dan Ammann, head of Exxon's low-carbon business, highlighted the company's commitment to enhancing North American energy security and reducing transportation emissions: “It’s a perfect example of how ExxonMobil can enhance North American energy security, expand supplies of a critical industrial material, and enable the continued reduction of emissions associated with transportation."
For battery-grade production, Exxon plans to construct one of the world's largest lithium-processing facilities, capable of producing 75,000 to 100,000 metric tons annually.
Exxon anticipates that demand for internal combustion engine fuels will peak by 2025 and return to early 2000s levels by 2050, with EV sales and lithium demand expected to surge by 2030, The Journal reported.
The expanding lithium industry in southwest Arkansas could revive the area, potentially creating thousands of jobs, a region affected by the 1980s oil crash.
Arkansas Governor Sarah Huckabee Sanders has committed to supporting this growth through tax cuts and regulatory simplifications. Exxon's venture into lithium is both a new direction and a return to its roots, recalling its pioneering role in the 1970s lithium ion battery development.
Reuters reports that Exxon is also testing unproven Direct Lithium Extraction (DLE) technology that will be "crucial for commercial operations".