Chevron has joined the ranks of some of the world's biggest oil producers in taking initial steps to explore for lithium, a key component in electric vehicle (EV) batteries.
The second-biggest US oil major said it has acquired about 125,000 net acres in northeast Texas and southwest Arkansas, covering parts of the Smackover formation — a region that has already drawn interest from rivals including ExxonMobil and Equinor for the high lithium content in its briny groundwater.
Oil companies are seeking to leverage existing skillsets to deploy advanced methods to extract lithium from brine water — which is regularly produced along with oil and natural gas — at the subsurface. The goal is to produce lithium at lower cost and with a smaller environmental footprint than traditional hard rock mining techniques or those that require massive evaporation ponds and more freshwater resources.
"Establishing domestic and resilient lithium supply chains is essential not only to maintaining US energy leadership but also to meeting the growing demand from customers," said Jeff Gustavson, president of Chevron New Energies. "This opportunity builds on many of Chevron's strengths including subsurface resource development."
Chevron acquired the two leasehold acreage positions from TerraVolta Resources, whose investor is an affiliate of the Energy & Minerals Group, and East Texas Natural Resources. Financial details of the deals were not disclosed.
The announcement follows growing interest in the region as oil companies seek to navigate the demands of the energy transition.
Smackover Lithium, a joint venture between Standard Lithium and Equinor, aims to produce 22,500 t/yr of battery-grade lithium carbonate from the Southwest Arkansas Project (SWA) by 2028.
In May, the Arkansas Oil and Gas Commission approved a 2.5pc quarterly gross royalty for the Reynolds Unit in Phase I of SWA, located in Lafayette and Columbia counties —setting a precedent for similar projects statewide.
In November 2024, ExxonMobil signed a deal to supply up to 100,000 t of lithium carbonate to South Korea's LG Chem, sourcing the feedstock from the Smackover Formation.
"By early next decade, big oil and big mining will replace the likes of [major US-based lithium producer] Albemarle at the top of the lithium world," said independent analyst Joe Lowry, host of the Global Lithium podcast.
