The world’s big oil companies have worked pretty hard to prolong society’s dependence on petroleum. When there are trillions of dollars at stake, there is plenty of motivation. But those companies do see the writing on the wall.
An Exxon Mobil-funded study last year estimated that light-duty vehicle demand for combustion engine fuels could peak in 2025 and that electric vehicles of various types could grow to more than 50% of new car sales by 2050. This is pretty pessimistic compared with most other surveys, but it is still a big number. Exxon also projected that the global fleet of EVs could reach 420 million by 2040.
As a result of all this, Exxon is preparing for a future far less dependent on gasoline by drilling for lithium rather than oil. The company recently purchased mining rights to a sizable chunk of Arkansas land for over $100 million from which it aims to produce lithium for electric car batteries.
Exxon’s consultants estimated that the 120,000 acres in the Smackover formation of southern Arkansas could have as much as 4 million tons of lithium carbonate, enough to power 50 million cars and trucks.
Exxon plans to spend $17 billion through 2027 on cutting carbon emissions and developing low carbon technologies. Other large oil producers have also been looking at the lithium business. At the same time, some large oil companies like BP and Shell are investing in renewable energy.
The prospect of EVs dominating transportation in the coming decades is a strong incentive for oil-and-gas companies to adapt their businesses to the new world.
Photo, posted August 16, 2014, courtesy of Mike Mozart via Flickr.