Standard Lithium (SLI -3.02%) was the subject of investor interest on Thursday, thanks in no small part to an important operational update. Although the stock traded nearly 7% higher at one point during the trading session, it ultimately deflated to a nearly 3% loss on the news. Meanwhile, the S&P 500 index landed in positive territory, closing up by 0.4% on the day.

An important fee agreed

Before market open, Standard announced that Smackover Lithium -- a joint venture between it and Norway-based energy company Equinor -- has won approval for a 2.5% royalty rate on a project in Arkansas.

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A royalty rate is the fee that is paid to holders of an asset where a good, such as lithium, is mined. That 2.5% rate will be in force for the Reynolds Unit for phase 1 of Smackover's play stretching across Arkansas' Lafayette and Columbia counties.

In the press release announcing the news, Standard didn't hesitate to mention that this is the first royalty rate for lithium derived from brine approved by the Arkansas Oil and Gas Commission (AOGC).

The royalty is to be dispensed to the brine owners, who will also receive an additional "brine fee," totaling just over $65 per acre annually. Standard said that this will bring the total proposed royalty consideration up to roughly 3%.

Every step is important

It's important to note that this is only an early phase of Smackover's project and, particularly considering that Standard hasn't yet launched mining at scale, it must be considered speculative. That might be what ultimately drove the stock down, as investors like it when a company puts its money where its mouth is, rather than reporting news of agreements or fees.

Still, this does mark an advancement in Standard's business, so perhaps that bearish market response was unwarranted. The company is certainly moving in an encouraging direction, and hopefully for shareholders, it can continue doing so.