A Drilling Veteran’s Take on Arkansas Lithium
Welcome to Lithium Link, your resource for insightful news and expert commentary on the latest happenings in the Arkansas lithium scene.
This week:
Our interview with Robert Reynolds, president of Shuler Drilling Co. of El Dorado, a 50-year veteran of the drilling industry. Reynolds is optimistic about the potential for a growing lithium industry in South Arkansas but says it will take technological breakthroughs and billions of dollars in investments to make it happen:
“Everything is relative,” Reynolds says. “Optimism is relative, changes are relative. And our chances are better than anybody else to meet an increased demand for lithium.”
Plus:
Tetra Technologies Inc. of The Woodlands, Texas, plans to start construction of a bromine and lithium plant this summer in Lafayette County.
Reynolds’ View
In our interview, which you can watch above, Robert Reynolds talks about the challenges and opportunities ahead for establishing robust lithium production in South Arkansas, and says battery makers have been making local inquiries about the state of the nascent industry.
Reynolds, an El Dorado native and a graduate of El Dorado Public Schools, brings decades of experience to the table. An engineer by trade, he’s spent 44 years at Shuler drilling in south Arkansas, north Louisiana, northeast Texas and parts of Mississippi and Alabama.
What to Know:
Reynolds says the fate of lithium production in South Arkansas depends on a technological breakthrough — one that makes drawing lithium from underground brine water and producing lithium carbonate in significant amounts economically feasible.
That’s exactly what companies like Standard Lithium Ltd. of Vancouver and Lanxess of Germany — with their direct lithium extraction (DLE) method — and other companies including ExxonMobil are working toward.
He also says — as he told Arkansas Business in an interview earlier this year — that it will take untold billions of dollars in investments to establish the infrastructure necessary to support the industry: roads, pipelines, electrical supply.
“That will take time. That will take years,” he says. “Archeological surveys, wetland surveys, that kind of stuff that not too many decades ago was not a factor.”
Opportunities:
Despite the challenges, Reynolds sees opportunities for businesses like his and others as lithium production comes online. Two groups in particular stand to benefit:
Local Entrepreneurs: “The people who will house, feed, clothe the people who come here to work. Constructing those specialty plants and pipelines and electrical will be largely done by people that are itinerant skilled workers — itinerant millwrights.”
Landowners: They stand to earn a royalty on lithium production on their land. “Now, it’s not going to send anybody to Hollywood like the ‘Beverly Hillbillies,’ but it is a significant contribution to the economic vitality of this area.”
How Soon Is Now?
In closing, we asked Reynolds who we should think about the timeline for the industry to get going. Years? Decades?
The answer surprised us. In the very quickest scenario — wherein companies like Standard Lithium piggyback on existing brine producers — ancillary industries could show up soon:
“You’re looking in the two- to four-year-type horizon. Those type of opportunities will exist if the lithium can be economically extracted from brine.”
And speaking of ancillary industry, Reynolds — who is in the loop with local economic development groups — knows that battery makers have already made local inquiries. The opportunity for them: domestic lithium battery production close to the source, with product shipped to auto manufacturing plants.
“They’re interested. They want to make their plans. But again, they’re not ready to pull the trigger until they see that indeed a large amount of lithium chloride can be extracted from the native brine.”
Get More: Watch the complete interview in the video player above.
Quick Hit:
In his regular Energy column for Arkansas Business, reporter Kyle Massey goes long on Tetra Technologies Inc.’s plans to start construction of a bromine and lithium plant this summer in Lafayette County.
The company, based in The Woodlands, Texas, aims to create 60 to 80 permanent jobs:
“We have reached an inflection point in our company’s history,” said [Elijio] Serrano, Tetra’s chief financial officer. “The volumes of bromine that we need for the oil and gas segment and other opportunities, we don’t have access to. So we made that decision here that we’re going to start turning brine into bromine.
“By the way, where we get the bromine out there’s also lithium.”
Read Massey’s complete column at Arkansas Business here.
Parting Shot:
ExxonMobil, a global energy giant that’s among South Arkansas’ new lithium players, is touting its community investment efforts in South Arkansas. Its leaders on the ground in El Dorado, including Remi Loiseau, Lithium Opportunity Manager, Global Projects, recently took part in the Magnolia Blossom Festival and World Championship Steak Cook-off:
“ExxonMobil sponsored the Blossom Festival for the first time this year — a sign of our deepening ties with communities in the southwest part of the state. That’s where we plan to produce lithium from saltwater brines deep underground — enough for about 1 million electric vehicles a year by 2030.”
A post on Exxon’s website quotes Rachel Jenkins, executive director of the Magnolia-Columbia County Chamber of Commerce: “Everyone here’s excited about lithium and the economic opportunities it could provide.”
