Exxon Mobil mentioned on Monday that it deliberate to arrange a facility in Arkansas to supply lithium, a essential uncooked materials for electrical autos, which pose one of many greatest challenges to the corporate’s oil enterprise.
Coming only a month after Exxon mentioned it could spend $60 billion to purchase Pioneer Pure Assets, the announcement alerts that the big oil firm intends to hedge its massive bets on standard fossil fuels with at the least some investments in cleaner types of power which are wanted to fight local weather change.
The announcement doesn’t symbolize a basic shift in company technique, however it’s an acknowledgment that battery-powered autos will more and more compete with vehicles and vehicles fueled by gasoline and diesel. It might additionally open the door for southern Arkansas to emerge as a significant supply of lithium. A lot of the steel as we speak comes from Australia and South America, and far of it’s processed in China.
“Electrification goes to be a significant part of the power transition, and we deliver extremely related expertise to the manufacturing of lithium,” Dan Ammann, president of Exxon Mobil Low Carbon Options and a former high govt at Common Motors, mentioned in an interview. “We see a possibility to deploy that might be extremely worthwhile.”
He mentioned the mission would “allow the continued discount of emissions related to transportation.”
Exxon introduced that it could start lithium manufacturing in 2027, with the aim of manufacturing sufficient steel to provide greater than 1,000,000 electrical autos a yr by 2030. The corporate didn’t say how a lot it could spend money on the mission, however Mr. Ammann mentioned the corporate was able to spend “lots of of hundreds of thousands” as a begin and would search for “extra alternatives” to increase lithium manufacturing.
An integral part of lithium-ion batteries, lithium has turn into a prize in a world race between American corporations and companies in China, Russia and elsewhere. The US produces solely a small quantity of lithium, although mining corporations are hoping to supply much more of it, together with in California, Nevada and North Carolina.
Exxon executives say the corporate’s experience in geology, drilling, hydraulic fracturing and chemical manufacturing will enable it to economically extract lithium from the soup of saltwater and minerals often known as the “Smackover brine” discovered underground in Arkansas. Exxon added that 1000’s of depleted oil wells drilled during the last century might ultimately be rehabilitated to supply lithium.
Lately, Exxon has doubled down on oil and pure fuel manufacturing within the Permian Basin, which straddles Texas and New Mexico, and within the deep waters off Guyana. Arkansas suits into its plans of concentrating its manufacturing near residence and away from the Center East and Russia, the place Western oil corporations beforehand tried and largely failed to ascertain sustainable companies.
Another oil corporations like BP, Eni and Equinor have invested in different types of power like photo voltaic, nuclear and wind, however Exxon has sought to extend its investments in fossil fuels whereas making an attempt to ramp up efforts at capturing and burying carbon emissions from business and producing hydrogen as a clear gasoline.
In Arkansas, Exxon plans to make use of a course of often known as “direct lithium extraction,” a brand new know-how that makes use of solvents or membranes and filters to supply lithium from brine. Engineers and executives which are pushing this technique have mentioned it’s superior to open pit mines or evaporation ponds as a result of it’s sooner and wastes much less water. However no one has efficiently proved that the method can produce sufficient lithium for hundreds of thousands of vehicles or stationary batteries.
Exxon, which bought drilling rights on 120,000 acres in Arkansas this yr, mentioned it could pump leftover brine again underground, and convert the lithium it mined to battery-grade materials close by. China dominates the troublesome enterprise of turning lithium discovered within the earth into the concentrated materials battery factories want.
Some power consultants are skeptical that direct extraction will work at massive scales and have mentioned Exxon’s effort might not enhance the availability of lithium by a lot. Mr. Ammann mentioned he was assured the know-how would work.
Some environmentalists expressed halfhearted reward for Exxon’s lithium efforts.
“It’s an infinitesimal fraction of what Exxon does, and most of what it does is dreadful,” mentioned Dan Becker, director of the secure local weather transport marketing campaign on the Heart for Organic Range. “However we do want lithium, and it’s higher that it comes from a spoiled industrial website the place oil drilling used to happen than from a pristine place.”
The Inflation Discount Act, signed by President Biden final yr, has helped spur efforts to supply lithium, make batteries and assemble electrical vehicles with beneficiant tax credit and different incentives.
Nonetheless, little new lithium manufacturing has come on line in the USA lately, and consultants notice that organising mines and processing vegetation right here might take a few years. Some corporations have been working for years to supply lithium from brine below the Salton Sea in California.
“It’s useful, but it surely’s not going to be sufficient for essential steel independence to get away from China,” mentioned Benny Freeman, a chemical engineering professor on the College of Texas at Austin who’s lively in lithium analysis. “However this, plus the Salton Sea, is an effective begin.”
Mining consultants mentioned Exxon had the experience to seek out lithium however may want exterior assist to separate the steel by filtration or purification from the salty liquids.
Exxon has held discussions with Tesla, Ford Motor and different automobile corporations to provide them with lithium. Different oil corporations, together with Chevron and Occidental, have additionally mentioned they’re investing in lithium mining.
In a approach, Exxon’s new enterprise in lithium is a return to its previous. Within the Seventies, an Exxon chemist performed a number one position in creating the lithium-ion battery. Exxon even started manufacturing the batteries in 1976 however gave up after concluding that the marketplace for the batteries was too small.
The value of lithium has been falling in latest months as new provides have turn into obtainable in numerous nations and the expansion price of electrical autos has slowed in China, Europe and the USA. However many power consultants anticipate a scarcity of the steel by the top of the last decade, which might end in larger costs.
