ExxonMobil Begins $500M Lithium Well Construction in Arkansas, Production Expected by 2027

This initiative could position ExxonMobil as a vital supplier in the booming EV battery market starting in 2027.

Highlights

• ExxonMobil has commenced building Arkansas's inaugural lithium well, tapping into significant local lithium deposits.
• Production is targeted for 2027, potentially establishing ExxonMobil as a major EV battery material provider and clean energy leader.
• Despite the U.S. holding about 4% of global lithium reserves (~1 million metric tons), domestic mining remains minimal with only one active mine producing 5,000 metric tons annually.
• The Institute for Energy Research emphasizes the need for more North American lithium mines to reduce import dependence and develop critical domestic expertise.

Energy giant ExxonMobil (XOM) announced the start of construction for a lithium well in Southwest Arkansas, marking the state's first such project. This region boasts rich lithium deposits essential for lithium-ion batteries powering electric vehicles.

Production slated for 2027 aims to secure ExxonMobil's role as a key supplier within the expanding EV market and as a pivotal player in the transition to clean energy.

Dan Ammann, President of ExxonMobil Low Carbon Solutions, stated, "Lithium is critical for the energy transition, and ExxonMobil is committed to leading electrification efforts." He described the project as a "win-win-win" by enhancing North American energy security, increasing supplies of a vital industrial material, and supporting emissions reduction.

The Strategic Role of Lithium in EVs and U.S. Energy Security

The U.S. Geological Survey reports that 80% of lithium extracted globally is utilized in battery production. Lithium's lightweight and high energy storage capacity make it the preferred metal for EV batteries.

Although the U.S. holds an estimated 1 million metric tons of lithium reserves, approximately 4% of the global total, domestic mining output is limited, with only one operational mine producing 5,000 metric tons annually. States like Maine, California, Oregon, and Tennessee have known reserves but no active extraction plans.

Consequently, the U.S. relies heavily on lithium imports, totaling 3,400 metric tons last year, primarily sourced from Argentina and Chile.

Globally, lithium production is dominated by Australia, Chile, and China, which together account for over 90% of supply. Australia alone contributed nearly 47% of global production last year.

The Institute for Energy Research advocates for expanding lithium mining in North America to reduce import reliance, bolster energy security, and cultivate scarce domestic expertise.

Rising lithium prices—quintupling since 2021—have increased EV costs, driven by battery and raw material shortages. Expanding U.S. lithium production could lower prices, making EVs more affordable and accelerating the clean energy transition.

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