By Kevin Killough – Just the News
Branching Out: Exxon, Chevron, Occidental Petroleum, and SLB, the world’s largest suppliers of services to the oil industry, are all getting in on the lithium action. The Biden administration is pushing hard for a transition to electric vehicles, but at the same time, restricting the production of necessary minerals sourced in the United States.
n April, the EPA proposed strict automobile pollution limits that would require, by most estimates, as many as two-thirds of all new vehicles sold in the U.S. to be electric (EV’s) by 2032. In addition to the proposed EPA rules, as of August, nine states plan to ban the sale of gas-powered cars over the next decade.
Each one of the batteries in all those EVs is going to require lithium — as well as many other rare earth minerals. That means automakers will place large demands on global lithium supplies. In turn, automakers have to scramble to find a supply of the critical mineral as fears of shortages loom.
Ironically, while the EV mandates are inspired by a vision of a world that has little need for fossil fuels, it’s Big Oil that’s stepping in to help satisfy that demand. Exxon, Chevron, Occidental Petroleum, and SLB, the world’s largest supplier of services to the oil industry, are all getting into the lithium action, Bloomberg reported this summer.
Exxon announced on Monday that it plans to become a leading producer of lithium. “This landmark project applies decades of ExxonMobil expertise to unlock vast supplies of North American lithium with far fewer environmental impacts than traditional mining operations,” Dan Ammann, president of ExxonMobil Low Carbon Solutions, said in a statement.
The company bought 120,000 acres in the Smackover formation — meaning one layer of rock underground — of southern Arkansas earlier this year for $100 million, The Wall Street Journal reported.
The operation would extract the lithium out of brine, which is the salty water inside rock formations, using a process called Direct Lithium Extraction. After the lithium has been obtained, the water will then be pumped back into the underground reservoirs 10,000 feet below the surface from where it came. Oil producers are long experienced in dealing with brine, also known as “produced water”, because it is a byproduct of oil and gas extraction.
Exxon estimates it will produce enough lithium for 1 million EVs per year by 2030, but the entire Smackover formation is estimated to have enough lithium for 50 million EVs.
According to the World Economic Forum, Australia, Chile and China currently dominate the production of lithium, and the U.S. is far down on the list. China, according to the International Energy Agency (IEA), also controls about 50% to 70% of all lithium processing, which is where the raw ore is refined down to the material used in batteries.
According to the scientific journal Nature, an average electric car battery weighing 1000 pounds requires approximately 16 pounds of lithium. In 2020, according to the IEA, global lithium demand for EVs was 20,000 tons. By 2040, that’s expected to balloon by more than 40-fold.
READ