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From black gold to white gold. While the days of fossil fuel oil are not yet over, its economic model is. With the energy transition underway, major oil companies are diversifying their activities to ensure their survival. ExxonMobil is a prime example. The American giant has announced its intention to become one of the world's largest lithium producers.
It's an ambitious project. The company hopes to launch its first lithium project by 2027 and, by 2030, produce enough lithium to equip one million electric vehicles. According to Patrick Howarth, Director of Commodities at Bloomberg, "The global demand for electric vehicle batteries is skyrocketing, and we know that the supply of lithium is only going in one direction: up."
The extreme volatility of lithium prices, with increases of 400% between 2020 and 2023, has not dampened the industry's enthusiasm. ExxonMobil is not alone in this venture. The group has signed an agreement with Standard Lithium, a major player in the sector, to develop lithium resources in Arkansas.
The interests of the oil giants do not always align with those of the United States. ExxonMobil plans to use a more environmentally friendly extraction technique than those used so far. The process, developed by Standard Lithium, uses brines from the Smackover Basin. The brines are brought to the surface, where they undergo chemical treatment to extract lithium.
In France, the company Lithium de France recently announced a similar project in Alsace. According to the company's CEO, "The French subsoil is rich in lithium brines, and we hope to develop this deposit to meet the growing demand for batteries."
The lithium market is booming, and ExxonMobil does not intend to be left behind. With the metal's price steadily rising and demand skyrocketing, the oil major sees lithium as a long-term growth opportunity. The aim is to make lithium a growth driver for the future, as the days of fossil fuel oil are numbered.