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LEWISVILLE, Ark. - Smackover Lithium, a joint venture between Standard Lithium Ltd. and Equinor, has received the green light from the Arkansas Oil and Gas Commission (AOGC) for the establishment of a brine production unit as part of its South West Arkansas Project. The approval, which comes without objections, marks a significant step in the project’s development aimed at producing lithium carbonate for batteries. According to InvestingPro data, Standard Lithium’s stock has shown strong momentum with a 29% return over the past year, despite recent market volatility.
The newly approved unit, named the Reynolds Unit, spans 20,854 acres and is projected to yield 22,500 tonnes of battery-quality lithium carbonate annually upon reaching full commercial production, which is anticipated in 2028. This development is a crucial milestone for the JV as it moves closer to a final investment decision on the project. InvestingPro analysis shows the company maintains a healthy current ratio of 5.77, indicating strong short-term liquidity to support its development plans.
"We thank the AOGC for their due diligence in reviewing our application and for their swift approval," said Dr. Andy Robinson, President and COO of Standard Lithium, who testified at the stakeholder hearing. The approval also sets the stage for establishing a royalty rate for the unit later in May.
Allison Kennedy Thurmond, VP of US Lithium at Equinor, expressed the company’s eagerness to collaborate with the AOGC and community stakeholders on setting a competitive royalty rate and maintaining the project’s momentum.
Standard Lithium is recognized for its focus on sustainable development of high-grade lithium-brine properties in the United States, leveraging a Direct Lithium Extraction process for commercial-scale lithium production. The Smackover Formation, where the company’s flagship projects are located, is a renowned lithium brine asset in Arkansas and Texas. With an overall Financial Health score of "FAIR" from InvestingPro, the company appears well-positioned to execute its development strategy, though investors should note the stock is currently trading below its Fair Value based on comprehensive analysis.
Equinor, headquartered in Norway, is an international energy company with a diverse portfolio that includes oil and gas, renewables, and low-carbon solutions. The company aims to achieve net-zero emissions by 2050 and views its partnership with Standard Lithium as an extension of its broad US energy portfolio.
The information in this article is based on a press release statement from Standard Lithium.
In other recent news, Standard Lithium Ltd. has made significant strides in its South West Arkansas (SWA) Project, aiming to produce 22,500 tonnes of battery-grade lithium carbonate annually. The company has begun a project finance and off-take process, with a banking advisor appointed to oversee its completion by the end of the year. Additionally, Standard Lithium and its partner Equinor are expanding their mineral leasing program in East Texas, with promising lithium brine grades reported in Franklin County. The company is also working with Koch Technology Solutions at the Demonstration Plant in Union County to advance Direct Lithium Extraction technology. In governance developments, Standard Lithium has appointed Karen G. Narwold to its board of directors, bringing over three decades of executive leadership experience, including her recent role at Albemarle Corporation. CEO David Park and Non-Executive Chairman Robert Cross have expressed confidence in Narwold’s ability to enhance the company’s growth. Standard Lithium continues to focus on its flagship projects in the Smackover Formation, leveraging its partnership with Equinor for the SWA Project and with LANXESS Corporation for the Phase 1A project. The company plans to hold a conference call to discuss its financial results for the six-month period ending December 31, 2024.
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