Trafigura has entered into a binding take-or-pay offtake agreement with Smackover Lithium to secure battery-grade lithium carbonate from the South West Arkansas (SWA) project in the US.
Smackover Lithium is a joint venture (JV) between Standard Lithium and Equinor subsidiaries.
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The agreement includes the purchase of 8,000 tonnes per annum (tpa) for a period of ten years, totalling 80,000t.
Deliveries are scheduled to commence with the start of commercial production in 2028.
The SWA project initially aims to produce 22,500tpa of battery-quality lithium carbonate, with plans for further expansion.
Direct lithium extraction technology will be used to extract lithium from brine resources in the Smackover Formation in southern Arkansas.
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By GlobalDataThe project is expected to reach its final investment decision (FID) by 2026.
The offtake agreement is a part of efforts to bolster US domestic lithium production and enhance supply chain security for this crucial mineral used in battery manufacturing and technological advancements.
Standard Lithium CEO David Park said: “The execution of this offtake agreement was the culmination of months of collaboration and negotiation and is a major milestone in moving the SWA project towards FID and construction.
“We are excited about the opportunity to collaborate with a strong industry leader like Trafigura and look forward to providing them with high-quality lithium carbonate to serve growing domestic and global markets in the coming years.”
Smackover Lithium’s initial phase targets customer agreements covering approximately 80% of its annual nameplate capacity, with this deal representing more than 40% of the planned commitments.
The JV is actively negotiating further agreements and conducting an offtake process alongside project financing activities.
Additional customer agreements are anticipated as part of preparations for the FID and close of project financing.
In November 2025, Smackover Lithium filed its first inferred resource report for the Franklin project in north-east Texas, US.
