The lithium boom is going to happen in southwest Arkansas. There's no longer any doubt about that.
It won't, however, be like the oil boom of the 1920s, which transformed towns like El Dorado and Smackover. I love reading about that era in Arkansas history when thousands of people from across the country descended on south Arkansas almost overnight.
That is the picture many Arkansans have in their minds when they think about the coming lithium boom. Think of it more like a large freight train. It's going to slowly gain speed. That won't happen all at once. But once it reaches full speed, it will be a sight to behold.
I'm the featured speaker next month for the annual banquet of the Magnolia Chamber of Commerce. I'm reading everything I can get my hands on these days regarding lithium developments in that part of our state.
Mike McNeill of the Magnolia Reporter, my friend of many decades, is attending the Arkansas Lithium Innovation Summit in Little Rock today. He's offering a running commentary on social media. What follows is based on Mike's reporting.
Andy Miller of Benchmark Mineral Intelligence said lithium production will need to grow 10 times by 2040 to meet 2050 needs. We're in a race with the rest of the world to produce the batteries that will be needed for electric vehicles.
In his comments this morning, Miller dismissed the argument that demand for EVs won't live up to the hype. In fact, Miller thinks a $50 billion investment is needed in lithium production to meet future needs.
Bob Galyen, an energy storage technology executive with 46 years of experience in battery technology, said China has been successful in battery production due to government incentives, technology, private equity investment, trained workers and quality equipment. The United States must catch up.
Galyen said there will be remarkable growth in the battery industry. He thinks economic development officials in Arkansas should target battery manufacturing and recycling. Meanwhile, universities in the state should lead the way in research in areas such as battery fire prevention.
Galyen said there's no competitive technology that will replace lithium in the next few decades. So this southwest Arkansas lithium boom will last for many years. This is no "Fayetteville Shale-type boom" that comes and goes quickly.
I can already think of two perfect locations for massive battery production facilities in Arkansas. One is the 900-acre supersite at Gum Springs near Arkadelphia. That site was put together for Sun Bio, the Chinese-owned pulp plant that was never built.
The other prime location is the 1,000-acre site being developed at the Port of Little Rock.
Miller said don't underestimate the research that already has gone into direct lithium extraction -- which is far more efficient and far cleaner that lithium mining processes currently used around the world.
What's known as DLE changes everything. It's why folks like the Koch family and ExxonMobil already are investing hundreds of millions of dollars in southwest Arkansas.
In a Wall Street Journal story last year, one industry executive called southwest Arkansas "the Permian Basin of lithium."
Brady Murphy, president and CEO of Tetra Technologies since 2019, said his company hopes to close in the next month on a plant site where lithium and bromine will be extracted from south Arkansas brine. He said it's a $500 million investment.
Patrick Howarth of ExxonMobil, who heads the energy giant's new lithium initiative, showed a video featuring Magnolia and then explained the differences between various technologies. He said ExxonMobil is planning to spend $20 billion on new energy technologies, including lithium. The company will have about three dozen production wells in the Magnolia area.
Albemarle, meanwhile, already has 56 years of experience extracting bromine from south Arkansas brine. There's a $500 million expansion of its facilities in the Magnolia area that's already taking place.
Albemarle already produces lithium in other countries and is positioned to do so in Arkansas. In fact, its pilot project at Magnolia may be in operation by late this year.
Robert Mintak, the CEO of Standard Lithium, which has operations at El Dorado, praised the Arkansas workforce and regulatory environment. Standard Lithium will begin production in association with Lanxess at El Dorado and then build another facility south of Lewisville in Lafayette County.
This is an exciting time for the Arkansas economy. It looks as if I'm going to have a lot to talk about in Magnolia next month.