Standard Lithium and global specialty chemical company Lanxess AG have signed both a binding Memorandum of Understanding (MOU) and a general Joint Venture (JV) term sheet agreement for a contemplated commercial production of battery-grade lithium compounds from brine extracted from the Smackover Formation in south Arkansas.

The MOU and JV agreement allow Standard Lithium to demonstrate its proprietary LiSTR direct lithium extraction technology on the premises of Lanxess southern brine processing plant. By connecting directly to the existing “tail brine” stream of Lanxess permitted operations the company is saving both significant time and infrastructure cost.

Under the proposed terms of the joint venture*, LANXESS would contribute lithium extraction rights and grant access to its existing infrastructure to the joint venture, and Standard Lithium would contribute existing rights and leases held in the Smackover Formation and the demonstration lithium extraction plant being developed as well as its proprietary extraction processes including all relevant intellectual property rights. Upon proof of concept, LANXESS is prepared to provide funding to the joint venture to allow for commercial development of the future commercial project, and it is anticipated that the joint venture will include options for Standard Lithium to participate in project funding on similar terms. The final terms of the joint venture and any funding arrangement remain subject to completion of due diligence, technical proof of concept, normal economic viability studies (e.g. Preliminary Feasibility Study etc.) to confirm the technical feasibility and economic viability of the project, and the negotiation of definitive agreements between the parties.

A recently completed positive Preliminary Economic Assessment targets the production of 20,900 tonnes lithium carbonate from a 3,140,000 tonnes lithium carbonate equivalent (LCE) Indicated Resource from the 150,000 acre Lanxess project.