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Released October 16, 2023 | SUGAR LAND
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Written by Paul Wiseman for Industrial Info Resources (Sugar Land, Texas)--The eyes of the energy world are zeroed-in on the Permian Basin even more than usual these days, with Exxon Mobil Corporation's (NYSE:XOM) (Irving, Texas) $60 billion acquisition of Pioneer Natural Resources (NYSE:PXD) (Irving, Texas) grabbing headlines. The megadeal will make ExxonMobil a dominant player in the oil-rich play, and the reverberations of this transaction could start an avalanche of mergers and acquisitions activity.
While the focus is upon the resulting entity's fossil fuels resources, Industrial Info's market strategists are seeing a possible energy transition angle, at least on a small scale. Noted IIR Energy's Geoffrey S. Lakings, "In truth there could be a larger game afoot eventually, involving REMMs (rare, earths, metals, and minerals), especially in regard to lithium extraction."
Both ExxonMobil and Pioneer have been experimenting with extracting lithium from oilfield waters--ExxonMobil from brine and Pioneer from produced water. Most wells produce more water than oil, in water-to-oil ratios of 3-1 and up to 10-1 in some Permian Basin formations. That "produced water" must be disposed of or cleaned up and recycled. If the cleanup process could extract useful minerals, it would help pay for disposing of the water.
Lithium is in growing worldwide demand for use in batteries needed for electric vehicles (EVs) and for storage connected with intermittent energy sources like wind and solar. Most lithium now comes from mines in Australia, Chile and Argentina, through methods that involve massive amounts of water and have been known to create pollution.
Worldwide lithium production for 2022 rose to a record 130,000 metric tons, a significant jump from 2021's previous record of 107,000 metric tons.
Earlier this year, ExxonMobil acquired lithium-brine-rich land in Arkansas and signed an extraction deal with oilfield water treatment company Tetra Technologies (NYSE:TTI) (The Woodlands, Texas). ExxonMobil bought drilling rights to 120,000 acres in the Smackover formation, paying Galvanic Energy $100 million in the transaction, according to reports by The Wall Street Journal. The region could hold as much as 4 million tons of lithium carbonate equivalent. That would supply batteries for about 50 million EVs.
ExxonMobil asked Tetra Technologies, according to an announcement by the latter company, to work toward extracting lithium and bromine, bromine being a key component of another type of battery, from the Arkansas acreage. That association would be with Exxon subsidiary Saltwerx, which the energy giant acquired from Galvanic Energy in the Smackover deal.
To facilitate the extraction, ExxonMobil has plans for a facility near Magnolia, Arkansas, designed to produce up to 110,000 tons of lithium per year, The Wall Street Journal reported. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals project and plant databases can click here for a detailed project report and click here for the related plant profile.
In August 2023, Pioneer Chief Executive Officer Scott Sheffield spoke about that company's interest in lithium, telling Bloomberg Television that Pioneer had been researching mineral extraction from produced water about three years earlier. Sheffield told Bloomberg, "We produce lots of water and we do have lithium in our water, so we've got some experiments going on to look at mining some of the important minerals in our water," along with gold and ammonia.
For several years the oil and gas industry has been mulling ways of mining produced water in order to mitigate the cost of dealing with what is otherwise a nuisance. But the key has so far been to make that extraction economical no matter the market price of lithium, and most believe that will be several years and many dollars in the future.
But as more companies attack the issue, its time could come sooner. Lakings has hope. "My opinion is that this will be the next breakthrough technology to power the energy transition. It has the potential to increase energy security by bringing more of this mining to U.S. shores, whenever that happens."
It does seem that getting lithium from either brine or produced water would be more environmentally friendly than mining methods largely used in Australia and South America. In a recent interview, Matt Crocker, senior vice president for ExxonMobil's low carbon solutions division, told Bloomberg, "One of the advantages of lithium from subsurface brines is it's a lot less energy-intensive and emissions-intensive than, say, the hard-rock mining that is common today. It's actually got some pretty good ESG (environmental, social and governance) benefits associated with it."
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
While the focus is upon the resulting entity's fossil fuels resources, Industrial Info's market strategists are seeing a possible energy transition angle, at least on a small scale. Noted IIR Energy's Geoffrey S. Lakings, "In truth there could be a larger game afoot eventually, involving REMMs (rare, earths, metals, and minerals), especially in regard to lithium extraction."
Both ExxonMobil and Pioneer have been experimenting with extracting lithium from oilfield waters--ExxonMobil from brine and Pioneer from produced water. Most wells produce more water than oil, in water-to-oil ratios of 3-1 and up to 10-1 in some Permian Basin formations. That "produced water" must be disposed of or cleaned up and recycled. If the cleanup process could extract useful minerals, it would help pay for disposing of the water.
Lithium is in growing worldwide demand for use in batteries needed for electric vehicles (EVs) and for storage connected with intermittent energy sources like wind and solar. Most lithium now comes from mines in Australia, Chile and Argentina, through methods that involve massive amounts of water and have been known to create pollution.
Worldwide lithium production for 2022 rose to a record 130,000 metric tons, a significant jump from 2021's previous record of 107,000 metric tons.
Earlier this year, ExxonMobil acquired lithium-brine-rich land in Arkansas and signed an extraction deal with oilfield water treatment company Tetra Technologies (NYSE:TTI) (The Woodlands, Texas). ExxonMobil bought drilling rights to 120,000 acres in the Smackover formation, paying Galvanic Energy $100 million in the transaction, according to reports by The Wall Street Journal. The region could hold as much as 4 million tons of lithium carbonate equivalent. That would supply batteries for about 50 million EVs.
ExxonMobil asked Tetra Technologies, according to an announcement by the latter company, to work toward extracting lithium and bromine, bromine being a key component of another type of battery, from the Arkansas acreage. That association would be with Exxon subsidiary Saltwerx, which the energy giant acquired from Galvanic Energy in the Smackover deal.
To facilitate the extraction, ExxonMobil has plans for a facility near Magnolia, Arkansas, designed to produce up to 110,000 tons of lithium per year, The Wall Street Journal reported. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals project and plant databases can click here for a detailed project report and click here for the related plant profile.
In August 2023, Pioneer Chief Executive Officer Scott Sheffield spoke about that company's interest in lithium, telling Bloomberg Television that Pioneer had been researching mineral extraction from produced water about three years earlier. Sheffield told Bloomberg, "We produce lots of water and we do have lithium in our water, so we've got some experiments going on to look at mining some of the important minerals in our water," along with gold and ammonia.
For several years the oil and gas industry has been mulling ways of mining produced water in order to mitigate the cost of dealing with what is otherwise a nuisance. But the key has so far been to make that extraction economical no matter the market price of lithium, and most believe that will be several years and many dollars in the future.
But as more companies attack the issue, its time could come sooner. Lakings has hope. "My opinion is that this will be the next breakthrough technology to power the energy transition. It has the potential to increase energy security by bringing more of this mining to U.S. shores, whenever that happens."
It does seem that getting lithium from either brine or produced water would be more environmentally friendly than mining methods largely used in Australia and South America. In a recent interview, Matt Crocker, senior vice president for ExxonMobil's low carbon solutions division, told Bloomberg, "One of the advantages of lithium from subsurface brines is it's a lot less energy-intensive and emissions-intensive than, say, the hard-rock mining that is common today. It's actually got some pretty good ESG (environmental, social and governance) benefits associated with it."
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
