Standard Lithium Q1 Earnings Call Highlights

Key Points

• Standard Lithium said it remains on track for a final investment decision in 2026 and to begin construction on its Southwest Arkansas project, with permitting, engineering, financing and vendor contracting all progressing.
• The company highlighted a major operational milestone at its demonstration plant, including more than 1 million barrels of brine processed and test results showing 95%+ lithium recovery and 99%+ contaminant rejection.
• Offtake and financing efforts are advancing, led by a 10-year Trafigura agreement for 8,000 metric tons per year and a project financing plan centered on about $1.1 billion in senior secured debt plus the DOE grant and partner funding.

Standard Lithium NYSEAMERICAN: SLI executives said the company remains on track to reach a final investment decision and begin construction in 2026 at its Southwest Arkansas lithium project, while reporting continued progress on permitting, offtake agreements, project financing and engineering work.

Chief Executive Officer and Director David Park said the company had an “active first quarter and year to date” as it advanced major milestones, including the processing of more than 1 million barrels of live Smackover brine at its demonstration plant in Arkansas over the past six years. Park said the plant has provided data to support the scalability and de-risking of Standard Lithium’s selected process technology and flow sheet.

Park also highlighted the company’s first binding commercial offtake agreement, announced in the first quarter, with Trafigura. Under the agreement, Smackover Lithium will supply Trafigura with 8,000 metric tons per year of battery-quality lithium carbonate over 10 years, beginning at the start of commercial production.

Southwest Arkansas Project Remains Focused on 2026 FID

President, Chief Operating Officer and Director Andy Robinson said Standard Lithium has four primary deliverables to complete before a final investment decision: executing contracts with key construction vendors, receiving approval under the National Environmental Policy Act, finalizing customer offtake agreements and closing project financing.

Robinson said the company is pursuing an engineering, procurement, construction and commissioning model for the downstream portion of the project, including the central processing facility, direct lithium extraction and lithium carbonate conversion process. For the upstream well field and pipeline portion, the company is pursuing an engineering, procurement and construction management model.

Robinson said agreements with selected partners for both contracting roles are expected to be completed in the second quarter. Each contract is expected to include a limited notice to proceed provision, allowing key work to begin before a final investment decision. A full notice to proceed would follow a positive FID.

On permitting, Robinson said the Department of Energy is leading the NEPA environmental assessment process, which was triggered by Standard Lithium’s $225 million DOE grant. He said the process is nearing its formal conclusion after more than a year of review and engagement, and the company expects it to be completed in the second quarter.

Park later told analysts that the public comment period has closed and said the company believes the report is finalized or near finalized. “We have not encountered any negative surprises along the way,” Park said.

Demonstration Plant Hits Key Operating Milestones

Robinson said the company’s El Dorado, Arkansas, demonstration plant has completed more than 15,000 direct lithium extraction cycles using real brine pumped from the Smackover formation. He said the plant met fundamental performance targets for the core process technology planned for Southwest Arkansas, including lithium recovery above 95% and rejection of key contaminants above 99%.

He also said the facility has accumulated roughly 340,000 man-hours over six years of operation with zero incidents. The plant will continue to support flow sheet optimization, data collection, engineering design and training for a team of 38 engineers and operators ahead of the company’s first commercial facility.

During the question-and-answer session, Robinson said cost tracking remains broadly consistent with expectations from the project’s definitive feasibility study and front-end engineering design work. He said the company has made allowances for escalation and tariffs in its pricing model and expects more formal cost updates as contractors proceed under limited notices to proceed.

Offtake and Financing Work Continues

Robinson said Smackover Lithium is targeting approximately 80% of its planned 22,500 metric tons of annual nameplate lithium carbonate capacity to be covered under long-term offtake contracts. The Trafigura agreement represents more than 40% of that targeted offtake volume. Robinson said the partnership expects to reach agreements on remaining advanced offtake negotiations by the third quarter.

In response to an analyst question about lithium pricing, Park said lithium carbonate prices have improved materially over the last year, bringing more counterparties back to the table with pricing mechanisms that support the company’s financing objectives. Park said Standard Lithium is running a competitive process and has a clearer view of likely counterparties, volumes, duration and pricing mechanisms than it had last fall.

Chief Financial Officer Salah Gamoudi said the project’s base capital expenditure is approximately $1.5 billion, according to the definitive feasibility study. He said the financing package is expected to include senior secured project debt, the $225 million DOE grant and funding contributions from Standard Lithium and Equinor.

Gamoudi said the joint venture is targeting approximately $1.1 billion in senior secured limited-recourse project debt supported by three major export credit agencies, including the Export-Import Bank of the United States and Export Finance Norway, along with commercial banks. He said expressions of interest from export credit agencies and banks have exceeded the targeted project debt amount.

First-Quarter Results Show Wider Loss

For the quarter ended March 31, 2026, Standard Lithium reported a net loss of $2.7 million, compared with a loss of $1.6 million in the same quarter of 2025. Gamoudi said general and administrative costs decreased slightly by $0.1 million, while demonstration plant costs increased by $0.4 million year over year due to higher personnel and supply costs tied to research and development, maintenance and site improvements.

The company recorded a non-cash foreign exchange gain of $2.2 million, driven by higher average U.S. dollar cash balances following a $130 million follow-on offering in October and currency fluctuations between the U.S. and Canadian dollars. Standard Lithium also recorded a $1.5 million investment loss from joint ventures, compared with $1 million in the prior-year period.

Gamoudi said the company ended the quarter with $141 million in cash and $139.5 million in working capital. Standard Lithium made $17.9 million in joint venture capital contributions during the quarter, including $9.6 million for Southwest Arkansas and $8.3 million for East Texas.

East Texas Development Advances

Robinson said Standard Lithium is continuing drilling and process test work at its Franklin Project in East Texas and the broader region. The company aims to release a preliminary economic assessment for Franklin in the second half of 2026, followed by a preliminary feasibility study in early 2027.

In response to analyst questions, Robinson said East Texas brines typically show higher lithium grades than Southwest Arkansas, with levels “500 plus” and into the 600s, 700s and 800s milligrams per liter in some cases. He said the company expects those higher grades to be favorable for project economics, though Standard Lithium has not yet released an economic assessment for the project.

Robinson also said much of the company’s Southwest Arkansas flow sheet could be carried over to East Texas because of similarities in Smackover brine geochemistry. He said East Texas could be simpler in some respects because the company does not expect to deal with sour gas in most of its project areas.

Park said current offtake discussions are focused on Southwest Arkansas, but potential partners are also interested in the company’s broader growth pipeline, including East Texas. He said the company remains focused on approving FID and beginning construction at Southwest Arkansas in 2026, with first commercial production expected in 2029 if that timeline is achieved.

About Standard Lithium NYSEAMERICAN: SLI

Standard Lithium NYSEAMERICAN: SLI is a mineral exploration and development company focused on the extraction of lithium from sedimentary brine resources. Utilizing direct lithium extraction (DLE) processes, the company aims to deliver high-purity lithium carbonate and lithium hydroxide suitable for the battery and electric vehicle markets. Standard Lithium's technology is designed to accelerate lithium recovery rates while minimizing environmental impact compared to traditional solar evaporation methods.

The company's flagship project is located in the Smackover Formation of southern Arkansas, in collaboration with chemical producer LANXESS.

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