Oil & Gas Commission Designates Southwest Arkansas Brine Unit

(Standard Lithium)

Standard Lithium’s joint lithium mining venture in southwest Arkansas now has an official brine production unit.

The Arkansas Oil & Gas Commission unanimously approved the Smackover Lithium project this month, formally naming it the Reynolds Unit. Smackover Lithium, the Arkansas-based partnership between Standard, of Vancouver, British Columbia, and Equinor of Stavanger, Norway, will run the unit in the first phase of its South West Arkansas brine lithium project.

Approval came at an open meeting in Lewisville, where no AOGC commissioners or members of the public spoke against establishing the unit.

Lewisville, a city of about 1,000, is Lafayette County’s seat. It’s the nearest town to 118 acres that Standard bought in 2023 as the site of a battery-grade lithium extraction plant.

Reynolds Unit

The Reynolds Unit includes 20,854 acres of brine fields in Lafayette and Columbia counties. Companies have pumped up the region’s underground brine for bromine extraction since the 1950s.

The brine is one of the richest resources for lithium in North America, according to Andy Robinson, Standard’s president and COO.

“We thank the AOGC for their due diligence in reviewing our application and for their swift approval,” Robinson said in a statement. The company said the approval “sets the stage for establishing a royalty rate” for brine field owners sometime next month.

Allison Kennedy Thurmond, Equinor’s vice president of U.S. Lithium, said the company is eager to collaborate with the commission and community stakeholders to keep the project moving forward.

Key Milestone

The brine unit is a milestone in Standard Lithium’s long effort to produce battery ingredients from lithium extraction in Arkansas.

The company, backed by Koch Inc. of Wichita, expects to begin commercial production in Lafayette County by 2028. It also projects that the facility could yield 22,500 tons of battery-quality lithium products per year.

The commission’s upcoming decision on lithium royalties is crucial to the industry. To satisfy Arkansas law, the AOGC must set royalty rates before extractors can sell lithium products. The royalties go to property owners who have leased their mineral rights to the lithium companies. And before “fair and equitable” royalties can be set, the AOGC must designate production areas as “brine units.”

“The SWA Project is our primary focus in Arkansas, and we look forward to completing this process to allow a final investment decision by year end,” Standard Lithium Director of Government Relations Jesse Edmondson told the Arkansas Advocate earlier this month.

The Department of Energy announced a $225 million grant in to help build the lithium plant. And President Donald Trump provided more momentum earlier this week by putting the project on a fast track for permitting. The administration listed the plant among 10 critical mineral production projects. Under the Fixing America’s Surface Transportation Act, such complex infrastructure projects receive priority for approval.

Planned Plant

The Lafayette County extraction plant, about 7 miles south of Lewisville, could eventually be a $1 billion project. The partnership between Standard and Equinor, announced nearly a year ago, provided $60 million in work project money. That represented a $33 million carry by Standard Lithium and a $27 million carry by Equinor. Equinor will also invest up to $70 million more subject to final investment decisions by both companies. Standard will own 55% of the South West Arkansas project, Equinor 45%.

“We believe this partnership with a global energy major validates the quality of our team, our [direct lithium extraction] flowsheet and experience, and our world-class lithium-brine resources in Arkansas and Texas,” Robinson said at the time, adding that Equinor’s involvement would “be fundamental to the continued de-risking and execution of these important projects.”

The Lafayette County plant could yield up to 300 construction jobs and as many as 100 direct permanent jobs.