The lithium boom

The lithium boom is going to happen in southwest Ar- kansas. I no longer have any doubt about that. Just don’t expect it to happen quickly.

This won’t be anything like the south Arkansas oil boom of the 1920s, which transformed towns like El Do- rado and Smackover almost overnight. I love reading about that era in our state’s history when thousands of people from across the country descended on the area. There were drillers, speculators, merchants, bootleggers, gamblers and prostitutes. It was wild.

That’s the picture many Arkansans have in their minds when they envision the lithium boom. We should think of it more like a long freight train. It’s going to slowly gain speed. That won’t happen all at once. But once it reaches full speed, it will be a sight to behold. We’re talking about something that will happen over three decades, not three years.

Earlier this year, hundreds of people gathered in Little Rock for a twoday lithium summit. They heard encouraging news from Andy Miller of Benchmark Mineral Intelligence, who said lithium production will need to grow 10 times by 2040 to meet 2050 needs. We’re in a race with the rest of the world to produce the batteries needed for electric vehicles.

In his comments at the summit, Miller dismissed the argument that demand for EVs won’t live up to the hype. In fact, Miller thinks a $50 billion investment is needed in domestic lithium production to meet future needs.

Bob Galyen, an energy storage executive with 46 years of experience in battery technology, said China has been successful in battery production due to government incentives, advanced technology, private equity investment, trained workers and quality equipment. The United States must now catch up.

Galyen predicted there will be remarkable growth in the battery industry during the next several decades. He thinks economic development officials in Arkansas should target battery manufacturing and recycling. Meanwhile, he says, universities in the state should lead the way in research in areas such as battery fire prevention.

Galyen said there’s no competitive technology that will replace lithium anytime soon. The southwest Arkansas boom should last for decades. This is no Fayetteville Shale-type boom that comes and goes in a few years.

I can already think of two perfect locations for massive battery production facilities. One is a 900-acre supersite at Gum Springs near Arkadelphia. That site was put together for Sun Bio, a Chinese-owned pulp plant that was never built. The other prime location is the 1,000-acre site being developed at the Port of Little Rock.

Miller said we shouldn’t underestimate the amount of research that already has gone into direct lithium extraction, a process that’s far more efficient and far cleaner than lithium mining processes currently used around the world. What’s known as DLE changes everything. It’s why folks such as the Koch family and ExxonMobil are investing hundreds of millions of dollars in southwest Arkansas.

In a Wall Street Journal story last year, an industry executive called southwest Arkansas “the Permian Basin of lithium.”

Brady Murphy, president and CEO of Tetra Technologies since 2019, said his company will invest $500 million in a south Arkansas plant. Meanwhile, Patrick Howarth of ExxonMobil showed a video at the summit featuring Magnolia and explained the differences in various technologies.

Howarth, who heads the energy giant’s lithium initiative, said ExxonMobil will spend $20 billion on new energy technologies, including lithium. The company is expected to have about three dozen production wells in the Magnolia area.

“We can achieve great things,” Howarth said. “We have the opportunity to start a new foundational industry in Arkansas, and with that comes significant capital investment.

That leads to economic development, which means jobs and opportunities. … It’s about additional revenue — individuals, businesses and the state.”

ExxonMobil has worked quietly to acquire drilling rights, conduct engineering design work and showcase its Arkansas projects to customers from around the world. Howarth said Arkansas “could be the center of the industry here in North America.”

ExxonMobil hopes to produce enough lithium to supply the needs of a million vehicles by 2030.

The saltwater brine in the Smackover Formation is about 8,000 feet below the Earth’s surface. Because southwest Arkansas developed a bromine industry decades ago, some infrastructure is in place for the lithium industry. DLE is the thing that has made production possible. We’ve known lithium is there. Soon, we’ll be able to extract it more cheaply, easily and in an environmentally responsible manner.

Standard Lithium has been working in Arkansas since 2017. Robert Mintak, the company’s CEO, said: “Comparing it to other projects in North America — I’m not trying to throw shade on anyone — there’s no reason anyone would go anywhere but Arkansas.”

Albemarle has been extracting bromine from brine in southwest Arkansas for more than 50 years and is positioned to do the same with lithium. Albemarle employs 675 people in the Magnolia area. In November 2020, it announced a $500 million expansion. Albemarle already produces lithium in other countries. Its lithium pilot project near Magnolia could be in operation by late this year.

Mintak praised Arkansas’ workforce and regulatory environment. Standard Lithium will begin lithium production in association with Lanxess at El Dorado and then build another facility south of Lewisville in Lafayette County.