On November 13, Exxon Mobil Corp (XOM:US) announced that it plans to start mass-producing lithium in North America. This move hints at Exxon's aim at diversity and to take advantage of the increasing need for batteries in EVs.
Exxon disclosed the opening of its first drilling operation in southern Arkansas. This commencement comes after the company purchased the Smackover Formation in early 2023. The land covers nearly 120,000 acres and has one of the biggest lithium deposits in the country.
Exxon, however, is not the only one. Oil companies are now focusing more on electric vehicles, in line with government encouragement. This strategic alignment positions Exxon favorably in the renewable energy market.
In its official announcement, the company said it plans to provide lithium for more than one million EVs each year. Achieving this goal could substantially increase Exxon's revenues and strengthen its market presence in the burgeoning lithium industry.
Adding to this, the company’s President, Dan Ammann, was reported as saying, “This landmark project applies decades of ExxonMobil expertise to unlock vast supplies of North American lithium with far fewer environmental impacts than traditional mining operations.” TD Cowen’s financial experts have also estimated that Exxon’s target of producing 50,000 tonnes could result in $800 million in cash flow but would also require a billion-dollar investment.
Based in Texas, United States, there has been a recent trend of trades in this stock by politicians. Specifically, Greg Stanton's spouse bought XOM shares on September 26, 2022. He later reported the sale of this and other stocks as per his policy of not owning individual stocks. Earlier this year, Representatives Kevin Hern and Michael Guest invested up to $30,000 and $15,000 respectively. Notably, Rep. Hern has been continuously investing in XOM shares since 2020.