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ExxonMobil and LG Chem Sign Agreement for Lithium Carbonate Supply in the U.S.

November 22, 2024

ExxonMobil and LG Chem have signed a non-binding memorandum of understanding (MOU) for a multiyear offtake agreement involving up to 100,000 metric tons of lithium carbonate. The lithium is planned to be sourced from ExxonMobil's upcoming U.S.-based project and supplied to LG Chem's cathode plant in Tennessee, which is expected to be the largest such facility in the United States.

Dan Ammann, president of ExxonMobil Low Carbon Solutions, emphasized the importance of securing domestic lithium supply, stating, "America needs secure domestic supply of critical minerals like lithium." He added that ExxonMobil aims to lead efforts in domestic lithium production, driving job creation, economic growth, and enhanced energy security in the U.S.

LG Chem's cathode plant in Tennessee, which began construction in December 2023, is projected to have an annual production capacity of 60,000 tons. The site benefits from its strategic location, providing easy access for both customer deliveries and raw material imports. Shin Hak-cheol, CEO of LG Chem, noted, "Building a lithium supply chain with ExxonMobil, one of the world's largest energy companies, holds great significance," emphasizing the company’s commitment to strengthening its global supply chain for critical minerals.

The planned production of lithium by ExxonMobil will employ Direct Lithium Extraction (DLE) technology, leveraging the company’s expertise in subsurface exploration, drilling, and chemical processing. The DLE technology is anticipated to offer significant environmental advantages over traditional hard rock mining, including approximately two-thirds lower carbon intensity. The final investment decision will be contingent upon the establishment of commercially viable regulatory frameworks.

This partnership is expected to bolster the supply of lithium for electric vehicle (EV) battery manufacturers in the U.S., providing a domestic option for lithium that has a reduced environmental footprint compared to conventional mining methods.

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