Commodity trader Trafigura secures access to lithium from US project

Dutch commodity trading company Trafigura has signed a binding offtake agreement with Smackover Lithium for the supply of battery-grade lithium carbonate from the South West Arkansas Project. The agreement covers 8,000 tonnes annually.

Smackover Lithium is a joint venture between the Canadian company Standard Lithium and the Norwegian energy group Equinor. Its goal is to extract lithium -essential for traction batteries – from the Smackover Formation in Arkansas. The venture’s name is derived from this geological formation.

The Smackover Formation consists of remnants of an ancient sea, which left behind an extensive, porous, and permeable limestone unit stretching beneath parts of Arkansas, Louisiana, Texas, Alabama, Mississippi, and Florida. In recent years, the formation has attracted attention due to its lithium potential in brines—highly saline waters associated with deep salt deposits. The German chemical group Lanxess (link in German) has already become involved in the region, testing Standard Lithium’s DLE (Direct Lithium Extraction) technology for years in a pilot plant at Lanxess’ site in El Dorado, Arkansas.

Smackover Lithium plans to produce 22,500 tonnes of battery-grade lithium carbonate annually in Arkansas from 2028. Trafigura will purchase 8,000 tonnes of lithium carbonate per year from the project over a ten-year period, totalling 80,000 tonnes.

Gonzalo De Olazaval, Head of Metals and Minerals at Trafigura, stated: “We are pleased to have signed this offtake agreement with Smackover Lithium, further strengthening our North American critical minerals footprint. The SWA Project is expected to provide a reliable source of battery-grade lithium carbonate produced in the United States, enhancing domestic supply chains. We look forward to collaborating with Smackover Lithium on this strategic project and to delivering this material to customers across North America and globally.”

Like many other countries, the USA is attempting to reduce its dependence on raw material imports, including lithium. Even under the Trump administration, which was critical of electric vehicles, a new funding programme was launched last summer to support, among other things, local lithium production.

trafigura.com