Thread regarding ExxonMobil Corp. layoffs

Exclusive: Exxon aims to begin lithium production by 2026 in Arkansas
November 11, 2023

Exclusive: Exxon aims to begin lithium production by 2026 in Arkansas
Darren Woods, CEO of ExxonMobil, speaks at the 2023 Milken Institute Global Conference in Beverly Hills, California, U.S., May 1, 2023.

Exxon Mobil (XOM.N) is set to unveil its long-awaited lithium strategy on Monday with an announcement that it aims to start production of the electric vehicle (EV) battery metal in Arkansas by 2026, according to a source with direct knowledge of the oil major’s plans.

Exxon’s expansion into the sector comes as emerging technologies aim to boost global production of the ultralight metal by filtering it from salty brine deposits found across the globe and supplying it to battery makers eager for fresh sources.

Exxon, which invented the lithium-ion battery in the 1970s but stepped away from the technology, plans to begin producing at least 10,000 metric tons per year of lithium in Arkansas by 2026 with partner Tetra Technologies (TTI.N) in what has been labeled “Project Evergreen,” according to the source.

That initial production would be roughly equivalent to the amount needed to produce 100,000 EV batteries.

Reuters reported this year that Exxon had agreed to develop more than 6,100 lithium-rich acres in Arkansas with Tetra, which produces chemicals for water treatment and recycling.

Exxon has been drilling wells in Arkansas this year to study the vast Smackover Formation, a geological formation stretching from Florida to Texas that teems with lithium- and bromine-rich brine. The company has also been testing unproven direct lithium extraction (DLE) technology that will be crucial for commercial operations, according to the source, who was not authorized to speak publicly.

An Exxon spokesperson declined to comment. A representative for Tetra was not immediately available to comment.

For Exxon and other oil companies, lithium production offers the prospect of selling a new product with relatively little added cost. Darren Woods, Exxon CEO since 2017, told investors during a call on Oct. 4 that the lithium sector was “fairly promising.”
He also said: “We see an opportunity to really leverage the things that we’re pretty good at.”

Exxon, like other fossil fuel producers, has faced pressure to reduce carbon emissions from operations. Reuters reported this year that Exxon shareholder Engine No. 1 had pressured the company to deploy DLE.

Exxon is not expected to publicly announce which DLE technology it has chosen, according to the source. The company has a long-standing pattern of not disclosing some vendors.

Reuters reported this year that Exxon and Chevron (CVX.N) held talks with International Battery Metals (IBAT.CD) and EnergySource Minerals about licensing DLE technology.

OTHER ACREAGE
Separate from its Tetra partnership, Exxon also controls more than 100,000 acres in Arkansas from which it plans to begin lithium production by 2027, according to the source.

Exxon acquired that acreage this year from privately held Galvanic Energy, Reuters reported.

It was not clear whether Exxon plans to expand lithium operations outside Arkansas. Like all oil producers, Exxon extracts water containing traces of lithium as part of fossil fuel production. That could help the oil industry morph into the world’s largest lithium supplier, if DLE technologies can be commercialized.

Exxon, like Albemarle (ALB.N), Standard Lithium (SLI.V) and others aiming to produce the battery metal in Arkansas, face a key regulatory roadblock. The southern U.S. state, just north of Louisiana, has a royalty structure for bromine, which Albemarle has long produced there, but not for lithium, which could delay development in the short term.
The Arkansas Oil and Gas Commission, which overseas lithium operations in the state, has said it plans to hold hearings on the matter.

Exxon plans to send at least six representatives to the Benchmark Minerals conference next week in Los Angeles, according to an attendance list seen by Reuters. It would mark the company’s first attendance at the major critical minerals conference.

Reporting by Ernest Scheyder; editing by Caroline Humer and David Gregorio

Written by Paul Wiseman for Industrial Info Resources (Sugar Land, Texas)--The eyes of the energy world are zeroed-in on the Permian Basin even more than usual these days, with Exxon Mobil Corporation's (NYSE:XOM) (Irving, Texas) $60 billion acquisition of Pioneer Natural Resources (NYSE:PXD) (Irving, Texas) grabbing headlines. The megadeal will make ExxonMobil a dominant player in the oil-rich play, and the reverberations of this transaction could start an avalanche of mergers and acquisitions activity.

While the focus is upon the resulting entity's fossil fuels resources, Industrial Info's market strategists are seeing a possible energy transition angle, at least on a small scale. Noted IIR Energy's Geoffrey S. Lakings, "In truth there could be a larger game afoot eventually, involving REMMs (rare, earths, metals, and minerals), especially in regard to lithium extraction."

Both ExxonMobil and Pioneer have been experimenting with extracting lithium from oilfield waters--ExxonMobil from brine and Pioneer from produced water. Most wells produce more water than oil, in water-to-oil ratios of 3-1 and up to 10-1 in some Permian Basin formations. That "produced water" must be disposed of or cleaned up and recycled. If the cleanup process could extract useful minerals, it would help pay for disposing of the water.

Lithium is in growing worldwide demand for use in batteries needed for electric vehicles (EVs) and for storage connected with intermittent energy sources like wind and solar. Most lithium now comes from mines in Australia, Chile and Argentina, through methods that involve massive amounts of water and have been known to create pollution.

Worldwide lithium production for 2022 rose to a record 130,000 metric tons, a significant jump from 2021's previous record of 107,000 metric tons.

Earlier this year, ExxonMobil acquired lithium-brine-rich land in Arkansas and signed an extraction deal with oilfield water treatment company Tetra Technologies (NYSE:TTI) (The Woodlands, Texas). ExxonMobil bought drilling rights to 120,000 acres in the Smackover formation, paying Galvanic Energy $100 million in the transaction, according to reports by The Wall Street Journal. The region could hold as much as 4 million tons of lithium carbonate equivalent. That would supply batteries for about 50 million EVs.

ExxonMobil asked Tetra Technologies, according to an announcement by the latter company, to work toward extracting lithium and bromine, bromine being a key component of another type of battery, from the Arkansas acreage. That association would be with Exxon subsidiary Saltwerx, which the energy giant acquired from Galvanic Energy in the Smackover deal.

To facilitate the extraction, ExxonMobil has plans for a facility near Magnolia, Arkansas, designed to produce up to 110,000 tons of lithium per year, The Wall Street Journal reported.

In August 2023, Pioneer Chief Executive Officer Scott Sheffield spoke about that company's interest in lithium, telling Bloomberg Television that Pioneer had been researching mineral extraction from produced water about three years earlier. Sheffield told Bloomberg, "We produce lots of water and we do have lithium in our water, so we've got some experiments going on to look at mining some of the important minerals in our water," along with gold and ammonia.

For several years the oil and gas industry has been mulling ways of mining produced water in order to mitigate the cost of dealing with what is otherwise a nuisance. But the key has so far been to make that extraction economical no matter the market price of lithium, and most believe that will be several years and many dollars in the future.

But as more companies attack the issue, its time could come sooner. Lakings has hope. "My opinion is that this will be the next breakthrough technology to power the energy transition. It has the potential to increase energy security by bringing more of this mining to U.S. shores, whenever that happens."

It does seem that getting lithium from either brine or produced water would be more environmentally friendly than mining methods largely used in Australia and South America. In a recent interview, Matt Crocker, senior vice president for ExxonMobil's low carbon solutions division, told Bloomberg, "One of the advantages of lithium from subsurface brines is it's a lot less energy-intensive and emissions-intensive than, say, the hard-rock mining that is common today. It's actually got some pretty good ESG (environmental, social and governance) benefits associated with it."

@OP Early this year a few people I knew came out of the program they said they are lowering the staff allocation on this joke

It never has. It never will. Wrong leadership.

How much money have our amazing lithium, CCS, and geothermal teams made us thus far? The future is bright!