LG Energy Solution has signed a 10-year binding offtake agreement with Smackover Lithium for 8,000 metric tonnes of battery-quality lithium carbonate annually.
Smackover Lithium, a partnership between Standard Lithium and Equinor, will supply the lithium carbonate from its South West Arkansas Project. The agreement gives LG Energy Solution access to a locally produced source of lithium for its US battery manufacturing operations.
The deal is significant for the development of a more integrated US battery materials supply chain, connecting domestic lithium production with domestic battery manufacturing.
DLE at the Center of the Supply Strategy
Smackover Lithium plans to produce the lithium carbonate using Direct Lithium Extraction (DLE) and purification technology.
For LG Energy Solution, the technology is part of a broader strategy to secure a more resilient and geographically diversified supply of critical battery materials.
The lithium carbonate will also meet non-PFE requirements, supporting LG Energy Solution’s efforts to supply battery products aligned with evolving US sourcing requirements.
Linking Lithium Production With Battery Manufacturing
LG Energy Solution operates seven production facilities in the United States, including three standalone sites, with established capacity for batteries using lithium iron phosphate (LFP) chemistry.
The agreement with Smackover Lithium creates a direct connection between US lithium production and LG Energy Solution’s domestic manufacturing footprint.
This type of integration could become increasingly important as battery manufacturers seek greater control over raw material sourcing, regional supply chains and regulatory exposure.
A Long-Term Demand Signal for US Lithium
The 10-year agreement provides Smackover Lithium with a defined customer for a significant portion of its future production.
For the wider DLE sector, the agreement also provides an important commercial signal. Battery manufacturers are willing to make long-term commitments to lithium projects that can meet requirements for volume, quality, location and supply-chain compliance.
This shifts the focus for DLE developers from demonstrating extraction performance alone to establishing commercially bankable projects with credible downstream customers.
Implications for the DLE Market
The agreement highlights several factors that are likely to influence the next generation of US lithium projects:
● Long-term offtake agreements
● Domestic lithium production
● Battery-grade product quality
● DLE process performance
● Supply-chain localisation
● Non-PFE compliance
● Integration with US battery manufacturing
● Long-term customer demand
For DLE developers, the benchmark is increasingly becoming clear. A technically viable extraction process must also support competitive economics, reliable production and credible customer commitments.
The Smackover Lithium agreement demonstrates how DLE can become part of a broader strategy to build a domestic lithium-to-battery supply chain in the United States.
