From: lessgovt@gmail.com   
      
   Exxon Joins Hunt for Lithium in Bet on EV Boom   
   By Benoît Morenne and Collin Eaton, May 21, 2023, WSJ   
      
   Exxon Mobil is bracing for a future far less dependent on gasoline by drilling   
   for something other than oil: lithium.    
      
   The Texas oil giant recently purchased drilling rights to a sizable chunk of   
   Arkansas land from which it aims to produce the mineral, a key ingredient in   
   batteries for electric cars, cellphones and laptops, according to people   
   familiar with the matter.   
      
   Lithium is far removed from the fossil-fuel business, which has powered   
   Exxon’s profits for more than a century, and signals the company’s   
   assessment that demand for internal combustion engines could soon peak, the   
   people said. It would also mark a    
   return for the company to an industry it helped pioneer almost 50 years ago.   
      
   Exxon bought 120,000 gross acres in the Smackover formation of southern   
   Arkansas from an exploration company called Galvanic Energy, according to some   
   of the people. The price tag was more than $100 million, people familiar with   
   the matter said, a    
   relatively small transaction for a company of Exxon’s size.   
      
   The new venture doesn’t amount to a significant strategic shift for Exxon,   
   which has said it is confident that oil and gas will be needed for decades.   
   But Exxon is looking to gain a foothold in a region believed to contain vast   
   lithium reserves, both    
   to produce the mineral and to test the viability of extraction technologies.   
      
   Exxon could begin drilling on the prospect in the coming months, people   
   familiar with the matter said, and could expand its operations if it proves   
   profitable.    
      
   Galvanic said last year that a third-party consultant it hired estimated the   
   prospect could have 4 million tons of lithium carbonate equivalent, enough to   
   power 50 million EVs. Extracting lithium from brine involves drilling for,   
   piping and processing    
   liquids, processes in which oil-and-gas companies have long developed   
   expertise, making them well suited to produce the mineral, lithium and oil   
   executives said.   
      
   Exxon projected last year that light-duty vehicle demand for internal   
   combustion engine fuels could peak in 2025, while EVs, hybrids, and vehicles   
   powered by fuel cells could grow to more than 50% of new car sales by 2050.   
   The company has also projected    
   the world’s fleet of EVs could climb to as much as 420 million by 2040, up   
   from 3 million in 2017.    
      
   Exxon Chief Executive Darren Woods said last year that fossil-fuel demand   
   would remain robust for decades, driven by the production of chemicals and   
   heavy transportation and industry.   
      
   Lithium production would also diversify Exxon’s portfolio and expose it to a   
   rapidly growing market. The company is positioning other parts of its business   
   to accommodate electric vehicles. Exxon executives have said many of its   
   chemical products    
   supply EV manufacturers, whose cars are made with plastics and other petroleum   
   products.   
      
   The auto industry’s shift to EVs has triggered a race to lock in supplies of   
   lithium and other materials core to battery making, much of which are   
   currently mined and processed outside the U.S. Tesla CEO Elon Musk has said   
   the lack of a steady pipeline    
   for processed lithium is a major obstacle.   
      
   The Biden administration is seeking to encourage domestic production of the   
   metal, despite opposition from environmentalists and others. The Inflation   
   Reduction Act signed by President Biden into law last year includes tax   
   credits covering 10% of the    
   cost of producing critical minerals, including lithium.    
      
   The U.S. once was the world’s largest lithium producer, but its output has   
   plummeted, and it is now dependent on other nations such as China for its   
   supply of the mineral. Producing lithium from regions such as Arkansas could   
   help the U.S. meet its    
   domestic needs as well as compete globally, analysts said.    
      
   In the 1970s, Exxon played a key role in the foundation of the lithium   
   industry. Exxon chemist Stanley Whittingham won a Nobel Prize in 2019 for   
   helping to develop the lithium ion battery while working at Exxon’s   
   corporate laboratory in Linden, N.J.    
   Exxon began to manufacture the batteries in 1976, but the market ultimately   
   proved too small, so the company ceased making the batteries some years later.   
      
   Exxon has plans to spend $17 billion through 2027 on cutting carbon emissions   
   and developing low carbon technologies. Unlike BP or Shell, which are   
   investing heavily in renewable energy, Exxon has said it would limit its   
   clean-energy investments in    
   technologies that hew to its core oil-and-gas business, such as hydrogen and   
   carbon capture. Exxon has never publicly proposed producing lithium as part of   
   its investment plans.    
      
   Other large oil producers have been looking at the lithium business.   
   Occidental Petroleum is developing technology to extract lithium from   
   subterranean brine through its subsidiary TerraLithium.   
      
   The prospect of EVs dominating public transportation in the coming decades   
   provides a strong incentive for oil-and-gas companies to get in on the lithium   
   business, said Pavel Molchanov, an analyst at investment bank Raymond James.   
   “It’s a classic    
   hedge against the prospect of eventually declining oil demand,” he said.    
      
   Southern Arkansas in recent years has emerged as a potential future lithium   
   hub. Smackover brine, a rich broth of saltwater and minerals, has long been   
   known to contain relatively high concentrations of lithium, but new   
   technologies have recently made it    
   possible to extract the metal from the brine in warehouse-size facilities.    
      
   The region also offers a favorable permitting framework and existing   
   infrastructure companies can capitalize on, lithium executives said. Over the   
   last century, oil producers drilled thousands of wells in the region to   
   extract crude oil. Special chemical    
   companies, such as Albemarle, have been producing brine suffused with bromine   
   there, a valuable chemical used in agriculture and sanitation.    
      
   Canadian company Standard Lithium has been operating a lithium demonstration   
   plant in the region since 2020 at a site owned by German chemical company   
   Lanxess.    
      
   So-called direct lithium extraction technologies have yet to be deployed at   
   scale, and it could be years before plants start churning out the mineral   
   commercially, analysts said.    
      
   https://www.wsj.com/articles/exxon-joins-hunt-for-lithium-in-bet   
   on-ev-boom-1d72cdd6   
      
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