WSJ: Exxon Mobil plans lithium processing facilities in southern Arkansas

Extraction efforts reported forthcoming near Magnolia

A worker stirs lithium with his hand at the SQM processing plant in Antofagasta, Chile, in this April 19, 2023 file photo. (AP/Rodrigo Abd)
A worker stirs lithium with his hand at the SQM processing plant in Antofagasta, Chile, in this April 19, 2023 file photo. (AP/Rodrigo Abd)

Exxon Mobil plans to build lithium processing facilities near Magnolia in southwest Arkansas that can produce as much as 110,000 tons of the metal a year, the Wall Street Journal reported Thursday.

That amount of the metal, vital in the construction of electric-vehicle batteries, would be about 15% of the world's total lithium production last year, the Journal reported.

Southern Arkansas and adjacent areas are dotted with abandoned oil and gas wells, all tapping the Smackover Formation. That play is now mostly emptied of fossil fuels, but filled with a brine that contains lithium.

Companies like Exxon and Vancouver, British Columbia-based Standard Lithium have been researching ways to economically extract the lithium from brine pumped out of the wells, after which the brine is deposited back in the wells.

The Journal reported in May that Exxon bought 120,000 acres over the Smackover Formation in southern Arkansas. Exxon bought the land from Oklahoma City-based Galvanic Energy, which secured access to 100,000 acres in south Arkansas in 2021.

Standard Lithium, meanwhile, spent this spring reporting good news about its own activities in the Smackover Formation. Sampled brine from a well in Lafayette County has the highest grade of lithium yet identified, the company's operations are expanding into parts of the formation in Texas, and the company has signed a joint development agreement with a Koch Industries subsidiary.

Standard Lithium's Lanxess Project site near El Dorado operates an industrial scale lithium-extraction demonstration plant.

Authorities in Magnolia, population 11,100, could not confirm the report of Exxon's plans near their community. Exxon did not respond Thursday to a request for comment.

The city has weathered the economy of the last several decades better than many other rural communities heavily invested in natural resource extraction. Albemarle, a chemicals manufacturer based in Charlotte, N.C., extracts bromine from the Smackover brine at a facility near Magnolia.

"Right now, we're blessed just by the announcement two months ago from Albemarle Corp., our largest employer outside the city of Magnolia in Columbia County, for a $540 million expansion," Magnolia Mayor Parnell Vann said. "PotlatchDeltic, one of the largest pine sawmills in the South, has announced a roughly $160 million project. We have in hand just shy of $700 million."

Even though Exxon and Tetra Technologies -- a Houston-area energy company that extracts bromine, which The Journal reports is also considering whether to build a lithium-extraction plant in south Arkansas -- have not reached out to him, Vann said he plans to submit a new housing plan to the Magnolia City Council on Monday that will pave roads and expand water and sewer utilities to two subdivisions north and east of the city.

"If Exxon Mobil's here, they don't just show up for a picnic. They've been very quiet. I've not heard, and they don't have to [talk]," Vann said. "Those folks don't think to go see a mayor in Magnolia, Ark., and ask questions. Because typically what folks in my position do is go out ringing a bell about economic growth and progress, and that's not what economic growth and progress wants. They want to quietly come in, take a look, see if it's going to work.

"I've said several times: We can't wait for these companies to show up and go, 'Oh, wait a minute, let us get ready.' We've got to be ready when they come. Because when you come to south Arkansas to take one of these jobs, if Magnolia doesn't have what you want, you're going to settle in another town," he said. "We can't afford that.

"We're going to go ahead and get our community growth ready for Albemarle and PotlatchDeltic, because those are two biggies right there," said the mayor. Vann said he is aware of the housing crunch North Dakota experienced during the Bakken Formation oil boom and wants to avoid the problem locally.

State Rep. Wade Andrews, R-Camden, said he and the community would welcome Exxon "with open arms" if they come, saying, "It's going to be a great thing for the region. We need an economic boost, for sure. I think a lot of people would be glad to see it."

Exxon has a history of industrial accidents. Andrews, however, noted that lithium extraction from brine pumped out of existing wells will have limited environmental surface impact. He also said that the freshwater Sparta Aquifer needs to be protected as the processed brine is deposited back into the wells.

That said, Andrews does not want "people to be ripped off" as economic development comes. He said he is focused on fair compensation for area residents, easement issues across private property and accurate accounting.