Equinor takes ownership stake in US lithium brine projects

Equinor announced this week that it has signed a deal with Standard Lithium to acquire a 45% stake in two lithium projects in Texas and Arkansas. The projects targeting the lithium-brine-rich Smackover Formation that straddles both states could see Equinor invest more than $130 million.

Standard Lithium, headquartered in Vancouver, Canada, will retain 55% ownership and continue as project operator. In addition to the new financing, Equinor will provide subsurface and project execution expertise to the partnership.

Last year, Standard Lithium reported that it had discovered North America’s highest concentration of lithium brine at its East Texas project.

Under the terms of the partnership, Equinor Standard will reimburse Lithium $30 million for past capital expenditures.

In addition, Equinor has committed $33 million in future expenditures to advance these projects to a final investment decision for large-scale development. Should the projects progress past this stage, Equinor may also make milestone payments to Standard Lithium totaling up to $70 million.

Morten Halleraker, senior vice president for new business and investments at Equinor, said in a statement: “This investment is an option with a limited upfront financial commitment. We can leverage core oil and gas technologies in a complementary partnership to enable these projects maturing towards a possible final investment decision.”

Standard Lithium previously estimated that the proposed facilities in Texas would cost $365 million and could produce an average of 5,400 tons of battery-grade lithium annually.

Standard Lithium CEO Robert Mintak said of the deal: “This partnership with Equinor is a major achievement for Standard Lithium. We have long believed that success in this sector depends on strategic partnerships with companies that share our vision and bring complementary strengths.”

The new investment underlines a growing interest in direct lithium extraction (DLE), an emerging technology that provides an efficient method to extract high-purity lithium from reservoir brine suitable for battery production. The process, in which Equinor has been investing through other equity deals since 2018, involves several stages including pre-treatment, extraction, concentration, purification and crystallization.

Equinor’s participation in the Smackover play follows similar initiatives by ExxonMobil, which has acquired a 300,000-acre position in southern Arkansas. ExxonMobil has said it wants to produce enough lithium from the Smackover by 2030 to build enough batteries for 1 million electric vehicles.