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ExxonMobil and LG Chem just announced a big move that could strengthen the US critical mineral supply chain and be a game-changer for EV manufacturers.
ExxonMobil is planning a big lithium extraction project in Arkansas, and they’ve signed a non-binding memorandum of understanding to supply up to 100,000 metric tons of lithium carbonate to LG Chem. This lithium will go to LG Chem’s massive cathode plant in Tennessee – a facility that’s set to become the largest of its kind in the country.
Right now, the US heavily relies on imports for lithium. ExxonMobil’s project aims to change that by providing a domestic supply, which could be a huge boost for US-based EV battery production. Plus, the planned project will use Direct Lithium Extraction (DLE) technology, which ExxonMobil says will cut carbon emissions by about two-thirds compared to traditional hard rock mining.
The LG Chem plant, which broke ground in December 2023, is expected to produce 60,000 tons of cathode material annually – enough to support a lot of EVs. Its location in Tennessee is also ideal for quick deliveries to US manufacturers and easy import of raw materials, streamlining the entire supply chain for domestic EV production.
The final go-ahead for ExxonMobil’s lithium project will depend on regulatory approvals and other factors. But if everything falls into place, this partnership could help secure a more stable, lower-emission lithium supply for US EV makers, which could be a big win for the industry.
In February, LG Chem made a 10-year deal with General Motors to supply 500,000 tons of cathode material, enough for around 5 million EVs. The contract will commence in 2026 – when the factory is expected to come online – and run until 2035.
Read more: LG Chem is building a $3B EV battery cathode factory – the largest in the US
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