Good Morning. This is the Sunya Scoop. The newsletter that takes energy transition news and turns it into an easy-to-read email for you.
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LITHIUM
Source: Galvanic Energy
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Exxon is seeking to produce lithium, a key ingredient in batteries for electric cars, by purchasing drilling rights to Arkansas land.
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The move indicates Exxon’s anticipation of a decline in demand for internal combustion engines and a future less dependent on gasoline.
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Exxon bought 120,000 acres in Arkansas from Galvanic Energy for over $100 million.
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The company aims to test the viability of extraction technologies and potentially expand its operations if profitable.
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Galvanic Energy estimates the prospect could have 4 million tons of lithium carbonate equivalent.
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Exxon projected that electric vehicles could account for over 50% of new car sales by 2050, with the global fleet reaching 420 million by 2040.
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The shift to EVs has triggered a race to secure lithium supplies, and the U.S. aims to encourage domestic production of the mineral.
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Exxon’s foray into lithium production would diversify its portfolio and tap into a rapidly growing market.
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Exxon has plans to spend $17 billion on carbon emissions reduction and low carbon technologies but has focused on investments aligned with its oil and gas business.
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Other oil producers, like Oxy, are also exploring the lithium business.
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Southern Arkansas has emerged as a potential lithium hub due to high lithium concentrations in Smackover brine and favorable infrastructure.
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Large-scale deployment of direct lithium extraction technologies may take years.
CARBON-FREE ENERGY
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NET Power and Rice Acquisition Corp. II have secured a $50 million PIPE commitment from SK Group and plan to establish a joint venture (NET Power-SK Joint Venture) to develop NET Power plants in Asia.
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The joint venture aims to leverage NET Power’s oxy-combustion supercritical CO2 power cycle technology and SK’s regional expertise to deploy clean, reliable, and low-cost power in Asian markets.
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Activities of the joint venture will include site selection, supply and offtake contracting, financing, and permitting.
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Decarbonizing Asian power generation is crucial to achieving global emissions goals, and NET Power believes its technology is cost-effective for decarbonizing fossil fuel-based power generation.
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SK is committed to achieving carbon net-zero by 2050 and sees deploying NET Power plants in Asia as a significant step toward decarbonization.
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With SK’s investment, the total expected investment in NET Power amounts to $895 million, including funds from RONI’s trust account, the PIPE, and interim financing.
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The combined company’s market capitalization is expected to exceed $2.0 billion, assuming no RONI shareholders exercise their redemption rights.
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NET Power and SK anticipate owning a 50% stake each in the common equity of the NET Power-SK Joint Venture, subject to negotiation and execution of definitive documentation.
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NET Power expects to require $200 million of net proceeds from the business combination and PIPE to fund corporate operations until the commercialization of SN1 in 2026. Additional proceeds will support SN1 capital needs and future commercial initiatives.
HYDROGEN
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Generate Capital has partnered with Ambient Fuels to scale green hydrogen projects and support the decarbonization of hard-to-abate industrial sectors.
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The agreement includes a commitment to fund up to $250 million of green hydrogen infrastructure to support Ambient Fuels’ growing pipeline of projects.
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Ambient Fuels offers custom-engineered green hydrogen solutions and has expertise in project development, design, financing, and construction.
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Generate Capital’s partnership provides capital and strategic support for Ambient Fuels’ long-term success and the delivery of green hydrogen facilities.
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The collaboration aims to deliver effective and cost-competitive solutions for emission-intensive sectors traditionally considered difficult to decarbonize.
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Current global hydrogen production accounts for 2.5% of global emissions, and green hydrogen is crucial for achieving a net-zero economy, especially in carbon-intensive sectors like ammonia production, oil refining, and heavy transportation.
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Using renewable electricity to produce hydrogen and replace grey hydrogen and e-fuels offers a practical and cost-efficient way to decarbonize these sectors.
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The partnership between Generate Capital and Ambient Fuels builds upon Ambient Fuels’ strong pipeline of green hydrogen projects and aims to accelerate their implementation.
RENEWABLES
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Enel SpA, an Italian energy company, plans to invest over $1 billion in a solar cell and panel factory in Oklahoma.
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The investment aims to capitalize on the U.S. government’s push for a domestic clean energy manufacturing sector to compete with China.
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The facility will be one of the largest solar equipment producers in the U.S. and will manufacture silicon-based solar cells on a large scale.
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The investment is significant in the solar manufacturing sector following the passage of President Joe Biden’s climate change law, the Inflation Reduction Act (IRA).
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Enel selected a site in Inola, Oklahoma, and expects to employ 1,000 people by 2025.
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The facility will initially produce 3 gigawatts of solar products per year, with production starting by the end of 2024, and potential future expansion to 6 GW per year.
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Enel’s U.S. manufacturing arm, 3Sun USA LLC, chose the Oklahoma site due to its utilities, workforce, and the need for speed to take advantage of IRA incentives.
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The state of Oklahoma may provide up to $180 million in funding based on certain conditions.
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Construction is expected to start later this year, and the factory will have the capability to manufacture solar cells, which is a unique feature in the U.S. market.
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President Biden sees Enel’s investment as evidence of the success of his Investing in America agenda and the resurgence of American manufacturing.
A big win for Oklahoma. Based on our personal experience, Italians may find the Italian restaurant scene in Oklahoma rather underwhelming…but there’s an Olive Garden in Catoosa.
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