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HOUSTON, Nov 13 Reuters Exxon Mobil said on Monday it plans to start producing lithium from subsurface wells by 2027 to provide supplies of the key metal used in electriccar batteries and advanced electronics.

Oil majors are investing in the electrification sector as governments in the United States and Europe set programs to promote wider use of electric vehicles and reduce fossilfuel consumption.

Exxon said it will start production from briny waters pumped out of the ground in an area in the state of Arkansas known to hold significant lithium deposits to help develop a domestic source of the metal.

In the long term, lithium really is a global opportunity, said Dan Ammann, president of Exxon39;s Low Carbon business unit. We are starting here because there is an urgent need to ramp up domestic production of these critical materials.

Exxon plans to supply lithium for well over 1 million EVs per year and become a leading supplier of the metal by 2030. Analysts at financial firm TD Cowen estimate its goal would require some 2 billion in capital expenditures to provide 50,000 tonnes, a volume that could generate 800 million in potential cash.

Ammann did not disclose how much Exxon intends to invest in the lithium business, or when it might become profitable.

The largest U.S. oil company said…