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Several countries around the globe are investing heavily in the extraction of lithium to support battery production for electric vehicles (EVs) and utility-scale storage. This has led to the enormous growth of mining projects in lithium hubs, such as the Lithium Triangle in South America. It has also encouraged greater exploration in less prolific areas, as energy companies look to strengthen their supply chains through domestic lithium production. In the U.S., Arkansas is rapidly becoming a major lithium hub, with other lithium states expected to emerge following greater exploration activities.
The Biden administration has supported the development of the domestic lithium industry with favourable policies for mining activities that support the green transition and funding from the Inflation Reduction Act (IRA) and Bipartisan Infrastructure Law (BIL). This forms part of the government’s drive to establish a reliable supply of critical minerals to support the deployment of renewable energy and clean tech.
In March this year, the U.S. Department of Energy (DoE) announced funding of up to $2.26 billion, under the Advanced Technology Vehicles Manufacturing loan programme, to construct the Thacker Pass lithium project in Nevada. The mine is expected to become operational later this decade and supply General Motors (GM) with lithium. Lithium Americas will extract approximately 40,000 metric tonnes of battery-quality lithium carbonate per year at Thacker Pass, which could power up to 800,000 EVs. This will eventually rise to around 80,000 tonnes per year. GM has invested an additional $650 million in the project.
In November last year, Exxon Mobil announced plans to produce lithium in the U.S. commencing in 2027. It will run operations in Arkansas, using conventional oil and gas drilling methods to access lithium reservoirs. Exxon is partnering with Tetra Technologies for its lithium business under the brand name Mobil Lithium. American Battery Technology Company, Applied Materials, and Cirba Solutions together received $2.8 billion in DoE funding for 21 new, retrofitted and expanded commercial-scale lithium processing and battery recycling facilities.
Albemarle, a major lithium producer, is pursuing lithium production in North Carolina. Earlier this year, it announced plans to reopen the resource-rich lithium Kings Mountain mine in the state by the end of 2026, supported by $150 million in DoE funding. However, it has faced backlash from environmentalists and indigenous groups looking to block the development, which has led to delays. Albemarle is looking to expand its domestic lithium production. At present, the company runs the Silver Peak mine in Nevada, the first lithium-producing mine in North America.
Based on recent discoveries, the U.S. could be well on its way to lithium independence. Last September, a group of scientists funded by Lithium Americas Corporation reported that the McDermitt Caldera, a volcanic crater on the Nevada-Oregon border, holds between 20 and 40 million metric tonnes of lithium deposits, which is almost double that found in Bolivia, which forms part of the lithium triangle. In December, the DoE announced that it had confirmed another major lithium deposit, under California’s Salton Sea. It stated that there were around 3,400 kilotons of lithium, which would be enough for over 375 million EV batteries. This is well above the 14 million metric tonnes previously mapped by the U.S. Geological Survey.
While the recent lithium discoveries in the U.S. are significant, the country still has limited capabilities to extract, refine, and produce domestic lithium. The top lithium producers worldwide currently are Australia, Chile, China, Argentina, Brazil, Zimbabwe, the U.S. and Portugal. The U.S. is the only one of these countries to have experienced a decline in lithium production over the last decade. It also has the lowest lithium production relative to the size of its reserves of these countries.
However, there are high hopes for the future of U.S.-produced lithium, with Arkansas emerging as a major hub for the critical mineral. Several major companies, including companies such as ExxonMobil, Albemarle, and Standard Lithium, have invested in mining operations in Arkansas. Based on recent exploration activities, the lithium reserves in the state are of a high quality, which should make for easier extraction.
The U.S. is investing heavily in the development of direct lithium extraction (DLE) technologies, to enhance their production potential. DLE technologies can extract up to 90 percent of lithium in brine, which is much higher than the conventional pond extraction rates of around 50 percent. They can also extract the mineral in days rather than months, potentially making it much cheaper and faster to produce. However, DLE has not yet been proven to work on a large scale, meaning that the U.S. must develop the technology further or deploy conventional production techniques on a wider scale to boost its lithium production capacity.
