Chevron has become the latest oil and gas company to place a big bet on lithium, announcing on 17 June the acquisition of two major leasehold positions in Texas and Arkansas.
The newly acquired assets—held by TerraVolta Resources and East Texas Natural Resources—will be combined to form a position of almost 125,000 net acres targeting the lithium-rich Smackover Formation, which spans northeast Texas and southwest Arkansas.
“This formation is of particular interest due to its notably high lithium content and marks Chevron’s first step toward establishing a commercial-scale, domestic lithium business,” the Houston-based supermajor said in a statement.
The entry into the limestone Smackover follows other investments made by ExxonMobil, Equinor, and Occidental Petroleum to commercialize US lithium brine resources, which can be used to make electric batteries.
Oil companies have been drawn to this emerging sector because it leverages many core oil and gas technologies and skill sets—such as subsurface appraisal, asset planning, and well drilling and operations—to extract lithium-rich brine.
Interest from the upstream industry has also grown alongside advancements in direct lithium extraction (DLE) technology which Chevron describes as a faster and more environmentally friendly alternative to traditional methods for recovering lithium. Once the lithium has been extracted, Chevron added that DLE enables the produced water to be reinjected into the reservoir.
Chevron also noted in its announcement that global lithium production has soared from about 9,500 metric tons in 1995 to nearly 198,000 metric tons in 2023, with Chile, Australia, and China leading global supply. Demand is projected to grow by 400% between 2021 and 2040, driven largely by the accelerating transition to electric vehicles and energy storage technologies.
“This acquisition represents a strategic investment to support energy manufacturing and expand US-based critical mineral supplies,” said Jeff Gustavson, president of Chevron's new energies business, adding that, “This opportunity builds on many of Chevron’s strengths including subsurface resource development and value chain integration.”
