LG Energy Solution has signed a 10-year agreement with Smackover Lithium to secure US Lithium Supply for its growing North American battery operations. Under the deal, LG Energy Solution will receive a total of 80,000 metric tons of lithium carbonate over the contract period, with deliveries scheduled to begin in 2029 when Smackover Lithium is expected to start commercial production.
The contracted volume of lithium carbonate is sufficient to manufacture batteries for approximately 1.8 million high-performance electric vehicles capable of travelling more than 500 kilometres on a single charge, according to LG Energy Solution.
LG Energy Solution Secures US Lithium Supply
The agreement represents a deliberate effort by LG Energy Solution to localise critical minerals sourcing within the United States. The company currently operates or is developing eight production facilities across North America and views domestically sourced lithium carbonate as essential to maintaining competitiveness in the regional battery market.
LG Energy Solution’s procurement centre leader, Lee Kang-yeol, said the deal marks another step toward building a solid and resilient supply chain that keeps the company’s products competitive in key strategic markets. He added that by bringing both battery production and sourcing to the United States, the company aims to deliver competitive and sustainable products to its customers.
The company also expects the local sourcing arrangement to support its compliance efforts with critical minerals sourcing requirements set out under the US Inflation Reduction Act. Meeting these requirements is increasingly important for battery manufacturers seeking to qualify for incentives tied to domestic mineral content.
Lithium carbonate is a key raw material used in both lithium iron phosphate and nickel-cobalt-manganese batteries. Demand for this material is expected to grow as battery makers expand production, particularly for energy storage systems. The long-term nature of the offtake agreement provides US Lithium Supply certainty for LG Energy Solution as it scales up operations across the continent.
Smackover Project Targets 2029 Commercial Production
Smackover Lithium is a joint venture between Standard Lithium, a US-based lithium developer, and Equinor, the Norwegian state-owned energy company. The venture plans to produce lithium carbonate at its South West Arkansas Project using direct lithium extraction technology, a process that recovers lithium from underground brine.
Direct lithium extraction offers potential advantages over conventional mining methods by reducing the environmental footprint associated with traditional lithium recovery. The South West Arkansas Project is expected to reach commercial production in 2029, aligning with the start of deliveries under the newly signed agreement.
The deal strengthens the emerging US Lithium Supply chain by connecting a major battery manufacturer directly with a domestic lithium project still in its development phase. For the broader critical minerals sector, long-term offtake agreements of this kind provide project developers with demand certainty that can support continued advancement toward production.
LG Energy Solution has also secured lithium supplies through partnerships with producers in other resource-rich countries, including agreements with Chilean producer SQM for lithium hydroxide and lithium carbonate, and with Australia’s Liontown for lithium concentrate.