There have been several recent and material developments at Standard Lithium Ltd. (SLI) and its JV Smackover Lithium since our last report. Here’s a summary of the most important ones, and how they may impact your investment thesis.
✅ Key Developments
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Definitive Feasibility Study (DFS) Filed for SWA Project
Smackover Lithium (the SLI‑Equinor JV) filed the DFS for its South West Arkansas project (SWA Project). Standard Lithium+2-
This is a major de‑risking milestone: the DFS is the technical & economic study required before a final investment decision (FID).
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Having set this milestone, the project moves closer to commercialization and a potential production decision.
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Maiden Inferred Resource Reported for East Texas (Franklin Project)
The JV reported a maiden inferred resource for the Franklin County “Franklin Project” in East Texas, which stands within the broader Smackover Formation. Standard Lithium-
This bolsters the resource base, expanding SLI/Smackover’s footprint beyond Arkansas.
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Adds optionality: more upside potential from East Texas beyond the core SWA asset.
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$130 Million Underwritten Public Offering
Standard Lithium priced an underwritten public equity offering of US$130 million to raise capital. Stock Titan+1-
Net proceeds are earmarked to fund capital expenditures at the SWA Project and the Franklin Project in East Texas.
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This addresses funding risk—one of the bear‑case issues for early‑stage lithium projects.
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Regulatory/Integration Approval in Arkansas
Smackover Lithium received key regulatory approval/integration from the Arkansas Oil & Gas Commission (AOGC) for the SWA Project. Standard Lithium+1-
This is important for permitting and project execution.
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It signals the asset is moving from conceptual to execution phase.
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📝 Implications & Interpretation
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Advancing from “blue‑sky” toward “near‑commercial”: With a DFS filed and regulatory approvals in hand, the project is progressing from exploration/development into pre‑construction and commercial readiness.
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Resource expansion creates optionality: The addition of East Texas resources adds geographic and project diversification and may enhance long‑term scalability.
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Funding risk mitigated: The capital raise of US$130 m provides improved financial runway to meet early capex needs. This reduces dilution risk and execution uncertainty.
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Permitting risk being addressed: Regulatory approvals in Arkansas are a positive signal in a jurisdiction known for oil/gas but now pivoting to lithium — local expertise exists; however, lithium projects still have new sets of regulatory/water/permit considerations.
⚠️ Risks Still to Monitor
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Final Investment Decision (FID) timing: Even with a DFS filed, the actual FID (i.e., committing to build) may still be some time off and subject to market, commodity price, technology/cost assumptions.
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Scale‑up execution risk: Although SLI has proven DLE technology, full commercial scaling always entails risk — cost overruns, delays, operational teething.
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Lithium price / macro risk: The financing raise helps, but the economics still depend on lithium market pricing, supply/demand dynamics, and input cost inflation.
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Dilution risk remains: Although the offering improves funding, future phases may still require further capital or joint‑venture commitments, which can dilute equity holders.
🔍 Investment Thesis Update
Given these developments, our earlier thesis is strengthened:
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The project is less speculative than before — key milestones are being achieved.
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The JV model (SLI/Equinor) continues to look structurally sound.
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The resource base and capital structure improve the odds of commercial success.
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This reinforces the view of SLI + Equinor as a leveraged play on U.S.‑based lithium brine extraction and critical‑minerals sovereignty.
📅 Key Milestones
| Date | Milestone | Details | Estimated Probability |
|---|---|---|---|
| 2017‑2018 | Entry into Smackover Formation leases & early DLE development | Standard Lithium secured brine rights and began development in the Smackover Formation (Arkansas & Texas). Standard Lithium+2SEDAR++2 | 100% (already achieved) |
| May 2024 | Formation of Smackover Lithium JV (SLI + Equinor) | JV with 55% SLI / 45% Equinor ownership established to develop SWA (Arkansas) and East Texas projects. Standard Lithium+1 | 100% |
| March 11 2025 | DLE Field‑Pilot De‑Risking Completed | Field pilot at SWA site achieved >99% lithium recovery, processed brines, large‑volume test. SEDAR+ | 95% |
| April – August 2025 | Regulatory Approval – Brine Production Unit | Arkansas Oil & Gas Commission (“AOGC”) unanimously approved Reynolds Brine Unit in SWA (20,854 acres) for Phase I. Smackover Lithium+1 | 90% |
| Q3 2025 | Release of DFS (Definitive Feasibility Study) for SWA Project | On September 3, 2025, the JV announced DFS results: 22,500 tpa Li₂CO₃ first phase; NPV US$1.7 billion; IRR ~20.2%. Standard Lithium | 100% |
| Q3/Q4 2025 | Maiden Inferred Resource for East Texas (Franklin Project) | On September 24, 2025 the JV released inferred resource: 2,159 kt LCE, grades up to 806 mg/L lithium in brine. Investing News Network (INN) | 100% |
| End 2025 (Target) | Final Investment Decision (FID) for Phase 1 SWA | The company is targeting an FID for SWA Phase 1 around year‑end 2025. Standard Lithium+1 | ~70% |
| 2026‑2027 (Estimate) | Construction Start for SWA Phase 1 | Subject to FID, construction expected to begin ~2026. Standard Lithium+1 | ~60% |
| 2028 (Estimate) | First Commercial Production (SWA Phase 1) | According to DFS, first production of ~22,500 tpa battery‑quality Li₂CO₃ expected in 2028. Standard Lithium | ~50% |
🧭 Interpretation of Timeline & Milestones
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Many of the key de‑risking steps (resource definition, DLE pilot plant, regulatory approval, DFS) have already been completed—this materially strengthens the development profile.
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The next critical milestone is the Final Investment Decision (FID). Until FID is taken, project execution remains subject to financing, permitting, market conditions and EV/lithium pricing dynamics.
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Construction start and commercial production are still forward‑looking and carry higher risk—delays, cost inflation and supply‐chain issues are possible.
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The East Texas inferred resource adds significant optionality—this means the scale of the project could increase beyond the SWA baseline.
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Regulatory and government support (e.g., DOE grant, U.S. critical minerals policy) further improve the odds of execution.
✅ What This Means for our Investment Thesis
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With many early stage milestones behind them, the project moves from speculative to pre‑commercial stage, which aligns well with our thesis of “small‑cap developer becomes major JV partner asset”.
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The quality of the resource (high lithium in brine grades) and technology (DLE) reduce extraction risk and improve cost competitiveness.
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If the FID is taken around end 2025, the project becomes execution ready, which should trigger re‑rating by the market (assuming lithium prices and EV demand remain favorable).
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The timeline suggests key events for your portfolio monitoring: FID announcement, construction start, offtake contracts, financing deals. These are the “triggers” that could move SLI/EQNR share prices.
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