[Complete Battery Mastery] ① How Did the US Oil Tycoon Become the Origin of Secondary Batteries?

1970s Oil Crisis Spurs Alternative Energy Research
Principle of Lithium-Ion Battery Discovered at ExxonMobil Research Institute

Editor's NoteWe are currently in the battery era. Batteries are found in almost everything, from mobile phones, laptops, to electric vehicles. [Complete Battery Conquest] is a series created to easily convey the basics of batteries, their ecosystem, company information, industry trends, and outlook to general readers, students, and investors interested in the battery industry and related companies. It is published every Saturday. After the series, it will be published as a book.

"Grandfather, when was the second oil shock? You remember it vividly, right?" This was a question posed by the eldest grandson Jin Seong-jun to his grandfather Jin Yang-cheol, the chairman, in the 2022 Netflix drama 'The Youngest Son of a Chaebol Family,' which gained great popularity. It was a ploy to expose Chairman Jin's delirium symptoms in front of many people. At that time, any businessman would certainly know the exact years of the first and second oil shocks that struck the world in the 1970s. Chairman Jin, struggling, was saved from crisis with the help of his youngest grandson Jin Do-jun.

The first oil shock in 1973 and the second oil shock in 1979 caused global oil prices to soar. Not only South Korea but major advanced economies suffered significant damage. The oil crisis that hit the world in the 1970s completely changed people's perception of fossil fuels. The vague fear that oil might not be freely available triggered research into alternative energy sources. Batteries were among them.

Photo by JTBC, screenshot from the drama 'Jaebeoljip Maknae Adeul'

The first oil shock was a result of the Fourth Middle East War. After losing to Israel in three previous wars, Arab countries including Egypt attacked Israel again on October 6, 1973. Early in the war, the Arab countries gained the upper hand, but soon Western countries including the United States supported Israel, reversing the tide. Dissatisfied, the Arab oil-producing countries abruptly announced measures to raise crude oil prices, cut production, and ban oil exports to countries supporting Israel.

As a result, oil prices quadrupled. The official crude oil price, which was $2.9 per barrel before the war, soared to $11.6 in January 1974. During the first oil shock, Americans had to line up at gas stations to fill their cars with gasoline. The advanced economies, which had grown rapidly thanks to cheap oil, suffered a severe blow. In 1974, major advanced countries experienced stagflation, a combination of double-digit inflation and negative growth. About five years later, in 1979, Iran again halted oil exports, triggering the second oil shock and delivering another shock to the global economy.

Through these two oil crises, the perceptions of politicians and businessmen about oil were fundamentally shaken. Western countries including the U.S. prioritized securing stable crude oil supplies in diplomacy, causing international affairs to become turbulent.

Awareness of energy also increased. Interest in alternative energy surged. Driven by the fear of "what if oil is not easily available," alternatives began to be sought. Research on batteries exploded from this point.

Batteries were not new, but they were not at a level to replace oil. Scientists focused on the potential of batteries as an energy storage medium. With the interest and support of large capital that experienced the oil crisis due to the oil shock, battery technology rapidly advanced. The lithium-ion battery, now widely used from small electronics like smartphones, tablets, and laptops to electric vehicles and aviation, was born amid this fear and turmoil.

"Lithium-Ion Battery Built Amid the Oil Crisis"

"Lithium-ion batteries are used worldwide in portable devices that we use to communicate, work, study, listen to music, and seek knowledge. They also enable the storage of renewable energy from solar and wind power and the development of electric vehicles capable of long-distance driving. The foundation of lithium-ion batteries was laid during the oil crisis of the 1970s."

This was stated by the Royal Swedish Academy of Sciences Nobel Committee in October 2019 when awarding the Nobel Prize in Chemistry to three recipients: John B. Goodenough, professor at the University of Texas (1922.7.25~2023.6.25), Stanley Whittingham, professor at Binghamton University, State University of New York (1941.12.22~), and Akira Yoshino, professor at Meijo University, Japan (1948.1.30~). The announcement was met with cheers in the chemistry community. Considering the role of lithium-ion batteries in transforming human life as much as semiconductors, it was widely regarded as a well-deserved award.

The Nobel Committee particularly highlighted the connection between the oil crisis and lithium-ion batteries. It was no coincidence that Stanley Whittingham produced the foundational research on lithium-ion batteries while working as a researcher at the oil company ExxonMobil.

Professor Stanley Whittingham. Source: Swedish Nobel Committee

Professor Whittingham discovered the 'intercalation layered structure,' the basic operating principle of lithium-ion batteries. This research was conducted while he was a researcher at ExxonMobil, an oil company. Ironically, the technology to replace oil was discovered by a researcher working at an oil company. Without the oil shock that struck the world in the 1970s, his research might have been buried.

Born in the UK, Professor Whittingham earned his Ph.D. in chemistry from Oxford University. After moving to the U.S. and completing postdoctoral work at Stanford University, he joined Esso (now ExxonMobil) as a researcher in September 1972. At that time, Esso focused on superconductivity research. Superconductors are materials with electrical resistance close to zero. Because they can transmit energy without loss, they are called 'dream materials.'

While researching superconductors, Professor Whittingham discovered that ions could be inserted into and extracted from the lattice-shaped atoms of certain metals. He called this phenomenon intercalation. He realized that energy could be stored using intercalation reactions and immediately began battery research. Experimenting with various materials, he applied titanium disulfide to the cathode and metallic lithium to the anode, resulting in a rechargeable battery generating 2.4 volts.

He promptly reported this discovery to the company. About a month later, he was summoned to the headquarters and explained his research results to a board subcommittee. What followed was rapid progress. Exxon’s corporate research lab ordered him to form a team to develop the research within a month. In 1973, Exxon filed its first related patent in Belgium. When the 1973 oil shock occurred, Exxon accelerated its efforts, registering numerous patents by 1975.

It may seem puzzling that ExxonMobil, an oil company, invested so quickly and boldly in batteries, a competing technology to oil. Two main factors influenced this: first, the oil depletion theory widely spread in the scientific community in the 1960s, and second, the first oil shock mentioned earlier. Both shared a common fear of oil scarcity.

At a seminar hosted by the Choi Jong-hyun Academic Foundation in 2021, Professor Whittingham recalled, "In 1972, Esso decided to transform from a petrochemical company into a comprehensive energy company and aimed to grow into a fuel cell and photovoltaic company." He explained that they started superconductivity research aiming to conduct scientific and technological R&D activities on the scale of Bell Labs, and lithium-ion batteries emerged from this research. In other words, lithium-ion batteries were developed while researching energy alternatives to fossil fuels.

Based on Professor Whittingham’s research, ExxonMobil was able to exhibit its self-developed lithium-ion battery at the Chicago Auto Show in 1977, during the height of the oil crisis. This battery, measuring 10 cm wide, 2.5 cm deep, and 15 cm high, could power a motorcycle headlight for a week. Earlier, in 1976, ExxonMobil had produced watches powered by lithium-ion batteries and photovoltaic cells, which were given as gifts to clients.

The lithium-ion battery ExxonMobil showcased at the 1977 Chicago Auto Show. Source: IEEE, 2012. Stanley Whittingham 'History, Evolution, and Future Status of Energy Storage'

In fact, oil companies had been preparing for oil depletion even before the oil shocks. The oil depletion theory had been a topic of debate among scholars and the oil industry since the 1950s and 60s. The theory was ignited by King Hubbert, an American geologist working as a researcher at another oil company, Shell. In 1956, he estimated U.S. oil production and announced the 'Peak Oil' theory, predicting that production would peak in the early 1970s and then gradually decline.

This research immediately became a global controversy. The Peak Oil theory was based on observations of oil production rates at various wells and was considered very scientific at the time. The model predicting the peak of oil production is called the 'Hubbert Curve' and is still useful in economics today.

Fear of the Third Oil Shock and the Electric Vehicle Big Bang

Coincidentally, the recent surge in interest in batteries is closely linked to oil prices. After the COVID-19 pandemic, as oil prices gradually rose past $100, interest in electric vehicles exploded.

When COVID-19, first detected in China in early 2020, spread worldwide, international crude oil prices plummeted. Anticipating a freeze in economic activity, oil futures even traded in negative territory at one point. West Texas Intermediate (WTI), which had been around $60 per barrel before COVID-19, dropped to the negative $30 range in April 2020. This was due to a sharp drop in demand as remote work became the norm.

However, this was short-lived. Supply chain bottlenecks caused oil prices to quickly recover. When the war in Ukraine broke out in February 2022, oil prices surged past $100 to touch $130. There were even talks in the market about a possible third oil shock.

As oil prices soared, consumers turned their attention to electric vehicles. Amid growing concerns about the climate crisis and the environment during the COVID-19 period, combined with rising oil prices, electric vehicle sales exploded. Annual electric vehicle sales rose from 2,220,356 units in 2020 to 4,778,317 in 2021, and then sharply increased to 8,020,555 units in 2022 (according to SNE Research). The annual growth rate was an astonishing 115.2%. Considering that global vehicle sales in 2022 were 80,631,101 units (according to LMC Automotive), one in every ten cars sold in 2022 was an electric vehicle.

With the explosive growth in electric vehicle sales, not only Tesla but also traditional internal combustion engine car manufacturers rushed to enter the electric vehicle market. Interest in lithium-ion batteries used in electric vehicles also surged.

▶What is Intercalation?

Originally, intercalation referred to the insertion of an extra day every four years in the solar calendar, known as an intercalary day. Stanley Whittingham discovered the phenomenon where molecules, atoms, and ions are inserted between the layers of a layered structure material and named it intercalation. Intercalation is the fundamental principle by which lithium ions and electrons move between the cathode and anode in a battery. During charging, lithium ions move to the anode, and during discharging, they move back to the cathode.

-Stanley Whittingham, 'Long Hard Road: The Lithium-Ion Battery and the Electric Car'

-Choi Jong-hyun Academic Foundation (Stanley Whittingham, Gevlander Cedar, Kang Ki-seok, Choi Jang-wook) 'The Future of Batteries'

-Royal Swedish Academy of Sciences Nobel Committee website