National Energy Services Reunited (NASDAQ: NESR) just signed an agreement worth approximately $200 million with Saudi Aramco to develop Saudi Arabia's first direct lithium extraction project.

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The agreement runs for up to five years and calls for the development of a facility capable of producing 2,000 metric tons of battery-grade lithium carbonate annually. Construction and commissioning are expected to lead to initial production in late 2027.

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For NESR, which primarily provides oilfield services throughout the Middle East and North Africa, the agreement represents an opportunity to expand into a potentially lucrative new market: lithium production.

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And it comes with one of the world's largest energy companies as a customer.

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Turning oilfield expertise into lithium production

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Lithium is a critical ingredient in rechargeable batteries used in electric vehicles, energy storage systems, and consumer electronics.

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Traditionally, lithium has been produced through hard-rock mining or by extracting it from underground saltwater deposits using large evaporation ponds. NESR is pursuing a different approach.

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Its proprietary LiThara platform uses direct lithium extraction technology to separate lithium from mineral-rich underground water, known as brine. The process is designed to extract lithium without relying on traditional evaporation ponds, potentially reducing processing time and allowing production facilities to be built in locations that might otherwise be unsuitable.

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Under the agreement, NESR's Environmental and Decarbonization Applications division will provide the technology needed to prepare the brine, extract the lithium, and convert it into battery-grade lithium carbonate. Aramco will contribute its extensive knowledge of underground geological formations and subsurface operations.

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The project also supports Saudi Arabia's broader effort to diversify its economy beyond oil and establish domestic supply chains for batteries and electric vehicles.

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Why this could be a bigger opportunity for NESR

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NESR already operates a substantial oilfield services business, employing more than 7,000 people across 16 countries.

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Its traditional operations include drilling, hydraulic fracturing, well completion, and other services that help oil and gas producers develop their resources. Lithium extraction gives the company an opportunity to use some of that existing expertise in an entirely different industry. And the potential extends beyond this initial agreement.

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If NESR can demonstrate that its LiThara technology works reliably and economically at the Aramco facility, it could strengthen the company's position when competing for additional lithium extraction projects throughout the Middle East.

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Saudi Arabia is particularly interesting because its oil and gas industry has spent decades studying underground formations and managing large volumes of mineral-rich water.

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Aramco has already identified lithium extraction as part of its diversification strategy. In its 2025 sustainability report, the company outlined ambitions to produce 5,000 tons of lithium carbonate equivalent annually through direct lithium extraction.

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NESR's new project could help advance those ambitions.

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