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Standard Lithium (TSXV: SLI, NYSE: SLI) shares rose on Friday after its US subsidiary, in partnership with oil and gas giant Equinor, was selected to enter negotiations for a funding of up to $225 million from the US Department of Energy.
The funding is intended to support the construction of the central processing facility for Phase 1 of the South West Arkansas project, located in Lafayette and Columbia counties in Arkansas.
The funding is one of the largest awards ever granted to a US critical minerals project. It is part of the second wave of funding under the Infrastructure Investment and Jobs Act, intended to award $3 billion to 25 projects for battery manufacturing sector.
The project aims to produce 22,500 tonnes of battery-grade lithium carbonate annually in its initial phase, using direct lithium extraction (DLE) technology.
Ownership of the South West Arkansas project is divided between Standard Lithium, holding 55%, and Norway’s state-owned Equinor, holding the other 45%.
Standard Lithium plans to achieve a total annual output of 45,000 tonnes of lithium carbonate at South West Arkansas, to be developed in two phases of 22,500 tonnes each.
Standard Lithium noted that a definitive feasibility study (DFS) and front-end engineering design (FEED) are currently underway to support this expansion.
Shares of Standard Lithium rose 7% by 11:30 p.m. EDT. The miner has a market capitalization of C$336 million ($248 million).
