LG Energy Solution signs $1.5 billion lithium supply deal in Arkansas

LG Energy Solution has signed a binding 10-year agreement with Smackover Lithium to supply 8,000 metric tons of battery-grade lithium carbonate annually, starting in 2029. The deal is estimated to be worth approximately $1.5 billion over the contract period.

Smackover Lithium is a joint venture between Standard Lithium and Equinor. The lithium will be produced at the Southwest Arkansas Project using direct lithium extraction (DLE) technology, which is designed to be a more sustainable and environmentally friendly method of sourcing material from underground brine.

The agreement aims to secure a stable, domestic supply chain for LG Energy Solution to support its production of lithium iron phosphate (LFP) batteries, which are increasingly used in the North American energy storage systems (ESS) market and electric vehicles. This local sourcing also helps meet requirements related to the Inflation Reduction Act (IRA).