SK On, a prominent South Korean EV battery manufacturer, has forged a non-binding agreement with ExxonMobil to procure lithium from ExxonMobil’s upcoming lithium extraction project in Arkansas.
The memorandum of understanding (MOU) outlines the potential for a multiyear supply agreement of up to 100,000 metric tons of lithium. This partnership is crucial for SK On’s operations in the United States, where it operates two battery factories in Georgia and is involved in joint ventures to construct four additional facilities with major automakers. These batteries are supplied to prominent automakers such as Hyundai, Volkswagen, and Ford.
ExxonMobil’s venture into lithium extraction in southern Arkansas marks a significant step forward, leveraging its rights to 120,000 acres in the lithium-rich Smackover Formation. The project aims to extract lithium from underground saltwater deposits and process it onsite into battery-grade material. This approach is expected to offer improved efficiency and reduced environmental impact compared to traditional hard rock mining methods.
The initiative aligns with ExxonMobil’s strategic goal to supply lithium for approximately 1 million EV batteries annually by 2030, with production slated to commence in 2027. By securing this agreement with SK On, ExxonMobil strengthens its position in the burgeoning EV battery supply chain, supporting the industry’s shift towards sustainable and domestically sourced materials.
The collaboration underscores the growing importance of securing reliable sources of critical minerals essential for the EV sector’s expansion, reflecting broader efforts to meet increasing global demand for electric vehicles while advancing environmental sustainability objectives.
