Key Takeaways

Smackover Lithium signed a binding take-or-pay offtake agreement with LG Energy Solution for its South West Arkansas Project.
The deal covers 8,000 metric tonnes a year of battery-quality lithium carbonate over a 10-year term once commercial production begins.
Smackover Lithium is a partnership between Standard Lithium and Equinor.
The agreement is the project’s second commercial offtake, following a contract with Trafigura announced in March.
With most offtake now secured, the project moves closer to financing and a final investment decision.

Smackover Lithium Locks In Second Offtake Deal

Smackover Lithium has signed a binding customer offtake agreement with LG Energy Solution, committing supply from its South West Arkansas Project to one of the world’s largest battery makers. The take-or-pay contract deepens the ties between an emerging U.S. battery material producer and a manufacturer that supplies cells for electric vehicles and energy storage systems.

Smackover Lithium is a joint venture between Standard Lithium and Equinor. The company is developing lithium extraction and processing in Arkansas, drawing on the region’s brine resources.

Terms of the LG Energy Solution Agreement

Under the agreement, the South West Arkansas Project will supply LG Energy Solution with 8,000 metric tonnes a year of battery-quality lithium carbonate over a 10-year period, starting after commercial production begins. The take-or-pay structure obliges the buyer to pay for contracted volumes whether or not it takes full delivery, giving the project revenue certainty.

Smackover Lithium Moves Toward a Final Investment Decision

The contract is the project’s second commercial offtake, adding to a deal with commodities trader Trafigura announced earlier in the year. With the majority of planned offtake now committed, Smackover Lithium said it has cleared a key step toward arranging project financing and reaching a final investment decision.

Arkansas Lithium and the U.S. Battery Supply Chain

Domestic lithium output remains limited even as demand grows for batteries used in vehicles and grid storage. Projects such as South West Arkansas are being positioned to supply U.S.-produced material to manufacturers building out capacity across North America, part of a broader renewable energy supply chain taking shape in the region.