Post by : Bianca
Haleem
Arkansas is poised to emerge as a pivotal center for lithium production within the U.S. as Standard Lithium gains significant backing from federal authorities in Washington. The Vancouver-based firm is in competition with Exxon Mobil for access to one of North America's largest lithium reserves, reflecting a growing commitment to domestic battery metal sourcing.
Support has streamed in from numerous U.S. senators, the Department of Energy, and federal permitting agencies for Standard’s initiative this year, while potential international partners are exploring debt financing options for the project.
With over seven years of experience developing direct lithium extraction (DLE) technology, Standard aims for first production by 2028. Although Exxon made headlines in 2023 with a $100 million investment in Arkansas, their plans have now been pushed back for at least a year.
In 2022, Standard faced significant challenges after a short-seller raised doubts about its DLE methods, leading to a sharp drop in its stock price. Nevertheless, the company has adapted, forming a partnership with Koch Industries to implement a new adsorbent material, and enlisting Norwegian energy leader Equinor for the $1.45 billion project.
Allison Kennedy Thurmond from Equinor remarked, "Standard has undergone various changes in its technology, which we actually view as a strength." Since 2022, short-seller positions have declined significantly, with five analysts on Wall Street now recommending the stock as a buy.
Sitting atop the Smackover formation, Arkansas boasts a tremendous underground reservoir containing over 5 million metric tons of lithium. In January, the Department of Energy granted Standard a $225 million fund to assist in lithium processing in the area, and regular meetings with federal staff are ongoing. Fast-track permits have been granted to speed up production.
Standard predicts that lithium prices could soar to an average of $22,000 per metric ton over the lifespan of the 20-year project, with production costs estimated at $5,924 per ton. Discussions are underway with banks and foreign governments regarding $1 billion in project financing, with decisions anticipated shortly. Arkansas Governor Sarah Huckabee Sanders has also expressed strong support for the nascent lithium sector in the state.
As federal attention increasingly turns to foster domestic lithium production, Standard Lithium is set to become an essential contributor to the future of battery metals in America.
English
