On August 31, 2026, LG Energy Solution announced it has entered into a binding, multi-year offtake agreement with Smackover Lithium to procure battery-grade lithium carbonate produced in the United States, further strengthening its upstream raw material supply chain security in the North American market.
Under the agreement, Smackover Lithium will supply 8,000 metric tons of battery-grade lithium carbonate annually to LG Energy Solution for 10 years following the commencement of commercial production from the project. The contract features firm offtake terms, ensuring a stable, long-term supply of lithium feedstock for LG Energy Solution.
Smackover Lithium is a joint venture between Standard Lithium Ltd. (55% stake) and Equinor (45% stake), with Standard Lithium serving as the project operator. Its Southwest Arkansas Lithium Project, located in the U.S. state of Arkansas, employs direct lithium extraction (DLE) technology to recover lithium from underground brine resources and is recognized as a key brine-based lithium development project in North America.
Phase 1 of the project is designed for an annual production capacity of 22,500 metric tons of battery-grade lithium carbonate, with first output targeted for 2028. Commercial deliveries under the offtake agreement are expected to begin in 2029.
Prior to this deal, the joint venture had already secured a separate offtake agreement with commodity trader Trafigura for 8,000 metric tons per year. With the addition of LG Energy Solution, the vast majority of Phase 1 production capacity has now been contracted to downstream customers, significantly reducing the commercial risk of the project’s ramp-up.
Lithium carbonate is a core raw material for lithium batteries and is compatible with LFP battery production lines for both electric vehicles and energy storage systems. As battery manufacturers expand output, particularly for energy storage applications, demand for lithium carbonate is expected to continue growing.
LG Energy Solution stated the agreement will help secure a stable supply of U.S.-produced lithium while strengthening its competitive position in the North American battery market. In addition, the local sourcing arrangement will assist the company in meeting the critical-mineral procurement requirements set forth under the U.S. Inflation Reduction Act (IRA).
Source: WeChat Official Account——新能源电池回收利用专业委员会
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