Lithium is the new oil AND, Smackover is America's new wellhead!

 

⚡ Investment Report: Smackover Lithium Project

Joint Venture between Standard Lithium Ltd. (NYSE: SLI / TSX-V: SLI) and Equinor ASA (NYSE: EQNR)

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🧭 Executive Summary

As America and China continue to lock horns over critical minerals and strategic materials, smaller North American players — Standard Lithium (SLI), Critical Metals Corp (CRML), Ucore Rare Metals (UCU), MP Materials (MP), and Avalon Advanced Materials (AVL) — are poised to thrive. These companies control valuable deposits of lithium, rare earths, and other critical minerals that underpin the global energy transition.

Among them, the Smackover Lithium Project stands out as one of the most strategically positioned and technically advanced lithium ventures in North America. With Standard Lithium as operator and Equinor ASA as a 45% partner, this project is well‑funded, technologically mature, and fully aligned with U.S. energy independence and clean‑tech industrial policy goals.

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🌍 Geological & Strategic Context

🔹 The Smackover Formation

• A geological giant stretching across the Gulf Coast Basin, running through southern Arkansas and eastern Texas.

• Formed by porous carbonate rock layers that host brine rich in lithium and other dissolved minerals.

• Already home to a mature industrial brine extraction ecosystem, historically focused on bromine production — creating ideal infrastructure for lithium development.

🔹 Project Zones

• Southwest Arkansas (SWA) Project: Core area of lithium concentration with average 437 mg/L lithium; planned capacity of 30,000 tonnes/year battery‑grade LiOH.

• East Texas Project: Expanding zone where brine samples have shown up to 806 mg/L lithium concentrations.

• Both project areas are contiguous within the subsurface Smackover geological system, forming a unified development corridor.

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⚙️ Technology & Operations

Direct Lithium Extraction (DLE)

• Proprietary process developed by Standard Lithium; continuously operated pilot plant in El Dorado, AR since 2020.

• >99% lithium recovery demonstrated, with minimal land and water use compared to evaporation ponds.

• Produces high‑purity lithium hydroxide suitable for EV batteries.

• Significantly shorter production cycles and lower carbon footprint.

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🤝 Joint Venture Structure — "Smackover Lithium"

Partner	Role	Ownership
Standard Lithium (SLI)	Project operator, technology owner	55%
Equinor ASA (EQNR)	Strategic investor, subsurface & capital partner	45%

• Equinor committed:

  • $30M upfront payment

  • $60M development work program

  • Up to $70M in milestone-based performance payments

• DOE Grant: $225M awarded (January 2025) for Phase 1 SWA construction.

• Operating JV name: Smackover Lithium — a separate entity governed jointly, designed to scale projects across the Smackover Basin.

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💰 Financial and Partner Strength

Standard Lithium Ltd. (SLI)

• Cash reserves: $31.2M (Dec 2024)

• Debt: None

• 100% operator of Smackover Lithium JV assets

• Positioned as one of the few pure‑play U.S. lithium developers

Equinor ASA (EQNR)

• Market Cap: ~$90B

• P/E: 7.8×

• P/S (TTM): 0.6

• P/CF (TTM): 3.6×

• Operating Margin: 28.4%

• Dividend Yield: 8.4%

• Strategic energy supermajor from Norway with deep pockets and global project execution capacity.

• Expanding beyond hydrocarbons into low‑carbon, critical‑minerals, and hydrogen sectors.

“Energy – Europe – America – Equinor ASA. P/E 7.8x, Dividend 8.4% — Nuff Said.”

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🧱 Development Roadmap

Milestone	Timeline	Status
JV Formation with Equinor	Q1 2025	✅ Completed
DOE $225M Grant Secured	Q1 2025	✅ Completed
FEED & Engineering Studies	Q2–Q3 2025	🔄 In Progress
Construction Start (SWA Phase 1)	Late 2025 – Early 2026	🔜 Planned
East Texas Resource Expansion	2025–2026	🔄 Active
Commercial Production Launch	2027 (est.)	🕒 Target

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📈 Investment Thesis

1. Strategic Resource Control: SLI and Equinor control one of North America’s richest lithium brine systems.

2. Government Support: DOE grant validates technical and geopolitical importance.

3. Technology Edge: Proven DLE technology de‑risks extraction and accelerates scalability.

4. Institutional Partner: Equinor’s financial strength ensures long‑term project execution.

5. Critical Mineral Supercycle: Geopolitical friction between the U.S. and China will continue to amplify the value of domestic lithium production.

We are long both SLI and EQNR. The combination of technology, capital, and national priority creates a unique, asymmetric upside in the North American lithium sector.

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⚠️ Risks & Mitigations

Risk	Impact	Mitigation
DLE Scale-Up Risk	Technical challenge in commercial scaling	Multi‑year pilot proven, DOE oversight ensures compliance
Permitting/Regulatory	Potential local or state delays	Favorable Arkansas regulatory climate; existing brine infrastructure
Lithium Price Volatility	Market-driven revenue swings	U.S. IRA incentives, potential offtake contracts, DOE-supported floor pricing
CapEx Inflation	Rising material costs	Equinor funding cushions; DOE grant offsets 20–30% of initial capex

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🌎 Macro Context: The Critical Mineral Rivalry

The U.S.–China rivalry over energy transition materials has escalated into a strategic resource race. Lithium, nickel, and rare earths have emerged as the new oil — essential to EVs, grid storage, and defense applications.

Small-cap developers like SLI, CRML, UCU, MP, and AVL occupy a unique sweet spot:

• They own the feedstock of the next industrial era.

• They are becoming acquisition targets for major energy and materials firms (e.g., Equinor, ExxonMobil, Rio Tinto).

• They provide investors with exposure to critical mineral leverage without megacap dilution.

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🧩 Conclusion

The Smackover Lithium Project is more than a single asset — it is a strategic partnership between innovation (SLI) and institutional power (Equinor), underpinned by U.S. government backing.

With world-class geology, proven technology, strong partners, and policy tailwinds, Smackover Lithium is positioned to become a cornerstone of America’s clean energy supply chain.

→ In short:

Lithium is the new oil. Smackover is America’s wellhead.

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As the U.S. Government invests more and more in precious metals and Lithium, I think it's possible that, Standard Lithium, $SLI could be next!

 

Equinor is their backer with a big share of the "Smackover" project,
Which is situated in both Texas and Arkansas.
We are long SLI and also long EQNR and here's why...

Energy - Europe - America - Equinor ASA NYSE: $EQNR
P/E Ratio 7.8x - Price/Sales (TTM) 0.6 - Price/Cash Flow (TTM) 3.6x
Operating Margin 28.4% - Dividend 8.4% - Nuff Said!!!
https://lnkd.in/gn52ddc9

Related Articles:

SLI's Smackover could be one of the richest Lithium Brine projects in the world, and it's located in Texas and Arkansas

retirefunds.blogspot.com

SLI's Smackover could be one of the richest Lithium Brine projects in the world, and it's located in Texas and Arkansas

 

Standard Lithium Ltd. (SLI) is a North American lithium development company focused on advancing lithium extraction projects in the United States, particularly within Arkansas and Texas. The company aims to contribute significantly to the domestic supply of lithium, a critical component in electric vehicle batteries and renewable energy storage systems.​Home+1Reuters+1

Technology and Extraction Methods

Standard Lithium employs Direct Lithium Extraction (DLE) technology, an innovative approach designed to efficiently and sustainably extract lithium from brine resources. Unlike traditional methods that rely on large evaporation ponds, DLE utilizes techniques such as adsorption and ion exchange to selectively extract lithium ions from brine. This method offers several advantages, including reduced environmental impact, faster processing times, and higher recovery rates. The company's demonstration plant in El Dorado, Arkansas, has been operating continuously since its commissioning in May 2020, showcasing the practical application of DLE technology. ​Reuters+6YouTube+6The Verge+6Lithium+1Home+1Standard Lithium Ltd.+1Standard Lithium Ltd.+1

Resource Estimates in Arkansas and Texas

In Arkansas, Standard Lithium's South West Arkansas (SWA) Project has reported significant lithium resources. The project boasts an average lithium grade of 437 mg/L, underpinning a minimum 20-year operating life with plans for at least 30,000 tonnes per annum of battery-quality lithium hydroxide production. Additionally, the U.S. Geological Survey estimates that the Smackover Formation in southern Arkansas may contain between 5 to 19 million tonnes of lithium, highlighting the region's substantial potential. ​JPT+27Stock Titan+27Standard Lithium Ltd.+27Stock Titan+2Standard Lithium Ltd.+2Standard Lithium Ltd.+2Stock Titan+3The Verge+3Arkansas Times+3

In East Texas, the company's drilling program has identified lithium brine concentrations as high as 806 mg/L in Franklin County. The first project area spans approximately 67,000 acres, with ongoing efforts to expand the resource base. ​Stock Titan

Development News

Standard Lithium has achieved several key milestones:​Empower Lives+16Standard Lithium Ltd.+16Standard Lithium Ltd.+16

• DOE Grant: In January 2025, the U.S. Department of Energy finalized a $225 million grant to support the construction of Phase 1 of the SWA Project. This funding underscores the project's strategic importance in bolstering domestic lithium production. ​Stock Titan+8Reuters+8Mining Technology+8

• Joint Venture Formation: In January 2025, Standard Lithium and Equinor announced the formation of Smackover Lithium, a joint venture dedicated to developing lithium extraction projects in Southwest Arkansas and East Texas. ​Reuters+13Stock Titan+13Standard Lithium Ltd.+13

• Technology Advancements: The company has reported exceptional lithium recovery rates exceeding 99% in field-pilot testing, demonstrating the effectiveness of its DLE technology. ​The Verge+2Stock Titan+2Lithium+2

Ownership and Partnerships

Equinor, a prominent international energy company, has acquired a 45% stake in Standard Lithium's projects in Southwest Arkansas and East Texas. This partnership involves an initial $30 million cash payment to Standard Lithium, with Equinor funding a $60 million work program. Additional payments of up to $70 million are contingent upon future project milestones and final investment decisions. Standard Lithium retains a 55% ownership stake and continues as the operator of these projects, while Equinor contributes its subsurface expertise. ​Reuters+14Enverus+14Nasdaq+14Reuters+3Standard Lithium Ltd.+3Mining Technology+3Reuters+1Standard Lithium Ltd.+1

Financial Overview

As of December 31, 2024, Standard Lithium reported cash reserves of $31.2 million and working capital of $27.5 million, with no term or revolving debt obligations. The company's stock is publicly traded under the ticker symbol SLI.​Stock Titan+1GlobeNewswire+1

Standard Lithium Ltd (SLI)

$1.20

Conclusion

Standard Lithium Ltd. is strategically positioned to become a leading player in the U.S. lithium market through its innovative DLE technology and significant resource holdings in Arkansas and Texas. The partnership with Equinor and substantial support from the U.S. Department of Energy further enhance the company's prospects. As the demand for domestically sourced lithium continues to grow, Standard Lithium's developments are poised to contribute meaningfully to the energy transition.​Reuters+1Standard Lithium Ltd.+1

"Smackover Lithium" is a newly formed joint venture (JV) between Standard Lithium Ltd. (55%) and Equinor (45%), announced in January 2025, created to develop and commercialize lithium extraction projects from the Smackover Formation, which spans southwest Arkansas and east Texas.

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🔍 What Is Smackover Lithium?

Smackover Lithium is not just a project name — it is a dedicated JV entity, structured as a separately governed commercial enterprise. It was formed to jointly manage, finance, develop, and operate lithium production facilities using Standard Lithium’s Direct Lithium Extraction (DLE) technology and Equinor’s subsurface expertise and financial backing.

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🏢 Ownership Structure

• Standard Lithium (SLI): 55% ownership

  • Brings technology, existing pilot plant, lithium resource rights, and operational leadership

• Equinor ASA: 45% ownership

  • Brings global energy development experience, large-scale capital support, and subsurface reservoir expertise

Equinor paid an initial $30 million to Standard Lithium for its stake and committed to fund $60 million in work program development. An additional $70 million is performance-based, contingent on meeting technical and investment milestones.

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⚙️ How Will Smackover Lithium Operate?

1. Focus Areas:

   • Southwest Arkansas Project (SWA): Flagship project with lithium hydroxide production targeted at 30,000 tonnes per year

   • East Texas Resource Expansion: High lithium concentration brines discovered; further drilling and testing ongoing

2. Operational Structure:

   • Standard Lithium is the Operator

     • Leads construction, DLE implementation, and lithium hydroxide production

     • Maintains control over day-to-day development and engineering

   • Smackover Lithium (the JV entity) holds the project assets, receives funding from Equinor, and distributes proceeds in line with ownership

3. Technology & Production Method:

   
   
   

   • Use of proprietary Direct Lithium Extraction (DLE) technology

   • Avoids large evaporation ponds

   • Demonstrated >99% lithium recovery rates in pilot-scale trials

   • Environmentally low-impact, water-efficient process

4. Regulatory and Financial Oversight:

   • DOE-funded Phase 1 construction at SWA (via $225M grant)

   • The JV is structured to qualify for U.S. government incentives under Inflation Reduction Act (IRA) and other U.S. battery supply chain initiatives

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📈 Viability & Strategic Importance

Yes, Smackover Lithium is viable — here’s why:

• Secure Domestic Lithium Supply: Targets a critical vulnerability in the U.S. EV supply chain by offering a domestic source of lithium hydroxide

• DOE Support + Equinor's Capital: Both public and private capital are backing it

• Strong Resource Base: Multi-million tonne lithium resource estimate across Smackover Formation

• Scalable Model: Once proven, JV could scale or replicate elsewhere in North America

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🧠 Summary

Smackover Lithium is a strategic, operational joint venture formed to commercialize large-scale lithium extraction using advanced DLE technology. It’s a separate company, majority-controlled by Standard Lithium, with deep-pocketed support from Equinor, and already positioned to play a major role in the U.S. lithium supply chain — especially with DOE grants and federal incentives backing its development.

Ed Note:

The "Smackover" project is also well positioned in relationship to Tesla's new Battery plants in Texas!

Most investors don't have this multi national energy company on their radar, however, we sure do! Equinor is a diamond in the rough!

 

Report: Equinor ASA (NYSE: EQNR)

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Executive Summary

Equinor ASA is a leading global energy company headquartered in Norway, operating across the oil, gas, and renewable energy sectors. With a strategic emphasis on sustainable growth and a transition toward low-carbon solutions, Equinor presents a compelling investment opportunity. This report provides a comprehensive analysis of the company's oil production, gas production, alternative energy production, production costs, resource estimates, energy output, financial performance, partnerships, customer base, expansion plans, and the countries it supplies.

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Company Overview

Established in 1972 as Statoil, Equinor ASA rebranded in 2018 to reflect its evolution into a broad energy company. Majority-owned by the Norwegian government, Equinor operates in over 30 countries, with significant activities in the North Sea, North America, South America, and emerging markets. The company is committed to delivering energy responsibly and sustainably, aiming to be a leader in the energy transition.

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Production

Total Oil Production

• Annual Oil Production: In 2022, Equinor produced approximately 1.1 million barrels per day (bpd) of oil and condensate.
• Key Oil Fields:
  • Johan Sverdrup: One of the largest oil fields in the North Sea, contributing significantly to Equinor's oil output.
  • Gullfaks, Snorre, and Grane: Other major fields on the Norwegian Continental Shelf (NCS) with substantial production levels.
• International Oil Operations: Equinor also has oil production assets in Brazil (Roncador field) and offshore U.S. Gulf of Mexico (Appomattox field).

Total Gas Production

• Annual Gas Production: Equinor's gas production averaged around 1.0 million barrels of oil equivalent per day (boe/d) in 2022, equivalent to approximately 62 million cubic meters of gas per day.
• Key Gas Fields:
  • Troll Gas Field: One of the world's largest natural gas fields, critical for European gas supply.
  • Oseberg and Åsgard: Significant contributors to Equinor's gas portfolio on the NCS.
• Gas Exports: Equinor is a major supplier of natural gas to Europe, accounting for over 20% of the continent's gas demand.

Total Alternative Energy Production

• Renewable Energy Capacity: As of 2022, Equinor had an installed renewable energy capacity of approximately 0.7 gigawatts (GW).
• Notable Projects:
  • Hywind Scotland: The world's first floating wind farm, operational since 2017.
  • Sheringham Shoal Offshore Wind Farm: A significant wind project off the coast of the UK.
  • Dogger Bank Wind Farm: Under construction, expected to be the world's largest offshore wind farm upon completion, with a capacity of 3.6 GW.
• Solar Energy Initiatives: Investments in solar projects in Argentina and Brazil to diversify the renewable portfolio.

Combined Production

• Total Production: Equinor's total production in 2022 was approximately 2.1 million boe/d, combining oil, gas, and renewable energy outputs.

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Production Costs

• Oil Production Cost: Maintained at a competitive average of around $5 per barrel on the NCS, attributed to operational efficiency and technological advancements.
• Gas Production Cost: Similarly low production costs due to integrated infrastructure and optimized processes.
• Renewable Energy Costs: Focused on reducing levelized cost of energy (LCOE) through innovation, scale, and operational excellence.

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Resource Estimates

• Proven Reserves: As of the end of 2022, Equinor reported proven reserves of approximately 6 billion boe.
• Renewable Energy Targets: Aiming to increase installed renewable capacity to 12-16 GW by 2030, primarily through offshore wind developments.

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Energy Produced

• Oil and Gas: Significant contributor to global energy supply, particularly in Europe, with a balanced portfolio of oil and natural gas assets.
• Alternative Energy: Growing renewable energy production aligns with global decarbonization efforts and supports Equinor's commitment to sustainability.
• Carbon Intensity Reduction: Targeting a reduction in net carbon intensity by at least 50% by 2050, with interim goals set for 2030 and 2040.

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Financials

• Revenue: Reported revenues of approximately $90 billion in 2022, bolstered by strong commodity prices and increased production volumes.
• Net Income: Achieved a net income of around $10 billion in 2022, reflecting robust operational and financial performance.
• Debt-to-Equity Ratio: Maintains a healthy balance sheet with a debt-to-equity ratio of about 0.5, providing financial stability and flexibility.
• Dividend Policy: Follows a progressive dividend policy, with a focus on delivering competitive shareholder returns while investing in future growth.

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Partnerships and Customers

Partnerships

• International Collaborations:
  • BP and SSE Renewables: Joint ventures in offshore wind projects like Dogger Bank enhance expertise and share risks.
  • Rosneft: Strategic partnership in Russia (note: subject to geopolitical developments).
• Technology and Innovation:
  • Microsoft and Schlumberger: Partnerships for digital transformation and technological advancements in exploration and production.
• Renewable Energy Alliances:
  • Collaborations with local and international partners to expand renewable energy projects globally.

Customers

• Countries Supplied by Equinor Energy:

  • Europe:
    • Norway: Domestic supply and operations.
    • Germany, United Kingdom, France, Belgium, Netherlands, Italy, Spain, Poland, Denmark: Major European customers for natural gas and oil.
  • Asia:
    • China, Japan, South Korea: Supplied through liquefied natural gas (LNG) exports and crude oil shipments.
    • India: Growing market for LNG and crude oil.
  • Americas:
    • United States and Canada: Supply through operations in the Gulf of Mexico and shale assets.
  • Other Regions:
    • Brazil and Argentina: Oil production and local energy supply.

• Customer Base:

  • Utilities and Industrial Companies: Long-term natural gas supply agreements with European utilities ensure stable demand.
  • Corporate Off-takers: Renewable energy power purchase agreements (PPAs) with corporations seeking to reduce carbon footprints.
  • Traders and Refiners: Supply of crude oil and refined products to global traders and refining companies.

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Expansion Plans

• Oil and Gas Exploration:
  • Norwegian Continental Shelf: Continued investment in exploration to sustain production levels, including developments like the Johan Castberg field.
  • International Ventures: Exploration activities in promising basins in Brazil, the Gulf of Mexico, and other regions.
• Renewable Energy Growth:
  • Offshore Wind Projects: Significant investments in offshore wind farms in Europe (Dogger Bank, Empire Wind) and North America (Beacon Wind).
  • Onshore Renewables: Exploring opportunities in solar and onshore wind projects globally.
• Carbon Capture and Storage (CCS) 
  
  
  
  • Northern Lights Project: Aiming to develop full-scale CCS solutions in Norway, enabling the capture and storage of CO₂ from industrial sources.
• Hydrogen Initiatives:
  • Blue Hydrogen: Developing projects to produce hydrogen from natural gas with CCS.
  • Green Hydrogen: Investing in electrolysis technology to produce hydrogen from renewable energy sources.
• Digital Transformation:
  • Implementing digital tools and automation to improve efficiency, reduce costs, and enhance safety across operations.

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Conclusion

Equinor ASA is strategically positioned to lead in the evolving global energy landscape. With a strong operational base in oil and gas, a rapidly expanding renewable energy portfolio, and a commitment to sustainability and innovation, the company offers a balanced and forward-looking investment profile. Equinor's robust financial health, strategic partnerships, diverse customer base, and clear expansion plans underpin its potential for long-term value creation and resilience amid the energy transition.

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Disclaimer: This report is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence before making investment decisions.

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