EL DORADO, Ark. - SWA Lithium, a joint venture between Standard Lithium and Equinor, has entered into a licensing agreement with Koch Technology Solutions (KTS) to use its Li-Pro Lithium Selective Sorption technology. This agreement will apply to the commercial plant of the South West Arkansas Project's Phase 1 and may extend to future phases.
The technology promises a lithium recovery rate of over 95% and impressive impurity rejection rates for calcium, sodium, potassium, and magnesium, exceeding 99%. Alongside performance guarantees, the license includes ongoing technical support and collaboration for technology refinement.
Standard Lithium's demonstration plant near El Dorado has been operating a commercial-scale Direct Lithium Extraction (DLE) column since late March 2024, which has surpassed expected lithium recovery and contamination rejection rates. The plant has processed over 24 million gallons of brine with the Li-Pro technology, reinforcing the company's commitment to efficient and sustainable lithium production.
Dr. Andy Robinson, COO of Standard Lithium, remarked on the significance of the agreement as a de-risking milestone for the project, emphasizing the partnership's success with KTS. Garrett Krall, Business Leader for KTS, echoed the sentiment, highlighting the technology's role in meeting future lithium demand responsibly.
Standard Lithium, focused on developing high-grade lithium-brine properties in the United States, is advancing the South West Arkansas project with Equinor. The company also explores lithium brine prospects in East Texas and holds interests in mineral leases in California.
The information in this article is based on a press release statement. Standard Lithium is publicly traded on the TSX Venture Exchange, NYSE American, and Frankfurt Stock Exchange under the symbols "SLI" and "S5L," respectively.
In other recent news, Standard Lithium has been selected for award negotiations of up to US$225 million by the US Department of Energy, a development that BMO Capital views as significant. This potential award is linked to Standard Lithium's South West Arkansas (SWA) project, which is currently undergoing a feasibility study and front-end engineering design. The project aims to increase its lithium carbonate equivalent production capacity from an initial 30ktpa to a larger 45ktpa, to be developed in two stages. BMO Capital has subsequently updated its outlook on Standard Lithium, raising the price target to Cdn$3.25, up from the previous Cdn$3.00, while maintaining an Outperform rating on the stock.
Simultaneously, the Arkansas Oil and Gas Commission (AOGC) is scheduled to consider an application from lithium companies, including Standard Lithium, which could influence royalty rates for lithium extraction in the state. Companies involved have suggested a royalty rate of 1.82%, while landowners are advocating for a significantly higher rate of 12.5%. BMO Capital's projections are based on a royalty rate assumption of 2.5%, suggesting that the AOGC may aim for a compromise that encourages the growth of the lithium industry within Arkansas. These are recent developments and have direct implications on Standard Lithium's project economics and future cash flows in the region.
InvestingPro Insights
Standard Lithium's recent licensing agreement with Koch Technology Solutions for their Li-Pro technology aligns well with the company's financial and market performance. According to InvestingPro data, Standard Lithium has seen significant short-term gains, with a 10.66% return over the last week and an impressive 33.74% return over the last month. This positive momentum extends to a 61.48% return over the last three months, suggesting growing investor confidence in the company's strategic moves.
The company's focus on technological advancements and partnerships is crucial, especially considering that Standard Lithium currently suffers from weak gross profit margins, as highlighted by an InvestingPro Tip. The collaboration with KTS and the promising results from their demonstration plant could potentially address this challenge by improving operational efficiency and reducing costs.
Another InvestingPro Tip reveals that Standard Lithium holds more cash than debt on its balance sheet, which is a positive indicator of the company's financial health and ability to invest in projects like the South West Arkansas Project. This solid financial footing is further supported by the fact that the company's liquid assets exceed short-term obligations, providing flexibility as they move forward with their expansion plans.
For investors seeking a more comprehensive analysis, InvestingPro offers 13 additional tips for Standard Lithium, providing deeper insights into the company's financial position and market prospects.
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