South Korea’s LG Energy Solution has secured 80,000 tons of lithium carbonate produced in Arkansas over a 10-year period, restructuring its North American supply chain into a fully integrated model. With deliveries beginning in 2029, the company will now have a complete system spanning from raw material procurement to battery production, all within the United States.

The company disclosed on the 1st that it has signed a long-term purchase agreement for lithium carbonate with U.S. lithium developer Smackover Lithium. Smackover Lithium is a joint venture co-founded by Canada’s Standard Lithium and Norwegian state energy company Equinor.

Under the terms of the agreement, Smackover Lithium will supply 8,000 tons of battery-grade lithium carbonate annually for 10 years—totaling 80,000 tons—starting in 2029 when commercial production begins. This volume is sufficient to produce approximately 1.8 million high-performance electric vehicles capable of traveling more than 500 kilometers on a single charge. Industry estimates place the transaction value at approximately $1.5 billion (about 2.1 trillion won).

The supply will come from the Southwest Arkansas (SWA) project in the southwestern region of the state. The project employs Direct Lithium Extraction (DLE) technology, which significantly reduces carbon emissions compared to conventional mining methods. DLE is a process that selectively extracts lithium from lithium-bearing brine, reducing land use and environmental impact, and is gaining attention as a key technology for expanding lithium production in the United States.

The backdrop to this agreement is the rapid growth of the North American energy storage system (ESS) market. As ESS installations accelerate due to rising electricity demand, demand for cathode materials used in lithium iron phosphate (LFP) batteries has surged, creating an urgent need for stable local raw material sourcing. Lithium carbonate is a core raw material used in both LFP and ternary batteries, and alongside lithium hydroxide—primarily used in high-nickel batteries—is considered one of the two key minerals in the battery industry.

The company expects that securing raw materials produced through environmentally friendly methods in the United States will enable it to meet the tax credit requirements under the Inflation Reduction Act (IRA). Additionally, the secured volume satisfies non-Foreign Entity of Concern (non-PFE) requirements, meeting an important criterion for companies seeking to build U.S. supply chains.

LG Energy Solution currently operates eight production facilities in North America, many of which have LFP battery production capacity. Once Arkansas-sourced lithium carbonate is supplied to these plants, the company will have a fully integrated supply chain—from raw material procurement to cell production—entirely within the United States.

Standard Lithium CEO David Park said, “We are deeply honored to enter into this agreement with LG Energy Solution, a world-class battery manufacturer. We expect to build a robust partnership where both companies grow together by supplying U.S.-produced lithium carbonate on a long-term, sustainable basis.”

Lee Kang-yeol, Executive Vice President and Head of the Procurement Center at LG Energy Solution, said, “This partnership with Smackover Lithium is a meaningful achievement that enhances supply chain stability by securing environmentally produced critical minerals in the strategic North American market. By bringing both battery production and raw material sourcing to the United States, we will provide competitive and sustainable products to customers leading the global ESS and EV markets.”

This agreement extends LG Energy Solution’s diversified supply chain strategy across major lithium-producing regions worldwide. The company previously signed a long-term supply agreement with Chile’s SQM for 100,000 tons of lithium hydroxide and carbonate, and a separate agreement with Australia’s Liontown for 1.75 million tons of lithium spodumene concentrate. With this latest deal, the company’s regional supply chain diversification strategy spanning South America, Australia, and North America has become more concrete.

Key Contract Terms

ItemDetailsSupplierSmackover Lithium (Standard Lithium–Equinor JV)Supply Start2029Contract Duration10 yearsAnnual Supply Volume8,000 tonsTotal Supply Volume80,000 tonsEstimated Transaction Value$1.5 billion (approx. 2.1 trillion won)Production MethodDirect Lithium Extraction (DLE)Production LocationSouthwest Arkansas, United States

Note: EV conversion based on high-performance models with 500+ km range per charge, approximately 1.8 million vehicles.