LGES procures more lithium from western Australia
According to LGES, it intends to use the lithium concentrate from WesCEF in battery cathodes for the North American market. This is possible without restrictions, as Australia has a free trade agreement with the USA – and critical battery raw materials therefore still fulfil the requirements of the Inflation Reduction Act. In other words, vehicles whose battery cells use lithium from Australia are fully eligible for subsidies in the USA.
With the 85,000 tonnes of lithium concentrate from WesCEF, LG Energy Solution wants to be able to produce around 11,000 tonnes of lithium hydroxide. This material will then be used in the cathodes for lithium-ion batteries. LGES is very active in North America: the company is a joint venture partner of GM at Ultium Cells and Stellantis at NextStar Energy with a battery factory under construction in Canada, the South Korean company is building a cell factory in Georgia together with Hyundai, with Honda in Ohio and on their own in Arizona.
This is the second supply contract between the two companies. In 2022, LG Energy Solution had already ordered 50,000 tonnes of battery-grade lithium hydroxide from WesCEF over five years. At that time, lithium hydroxide was ordered directly, not lithium concentrate. At 85,000 tonnes, the current order appears to be larger, but it is actually significantly smaller with the 11,000 tonnes of lithium hydroxide obtained from it. LGES does not provide information on the financial scope of the current order.
WesCEF’s lithium materials – whether lithium hydroxide or lithium concentrate – are to come from the Mt Holland project, which is currently still being developed. Mining at one of the largest hard rock lithium projects in the world is scheduled to start in the first half of 2025. WesCEF is supported by the Chilean raw materials group SQM as an investor and partner in the billion-euro project, as SQM has a great deal of experience in lithium mining and processing. SQM is also a lithium partner of LGES.
“As an industry leader, in line with the global trend of electrification and corresponding clean energy policies, we are upholding the value of sustainability in not just our products but every aspect of our business, including supply chain,” said Kang Yeol Lee, Senior Vice President of Procurement Centre at LG Energy Solution. “Partnering with major suppliers with great potentials like WesCEF, we will ensure stable procurement of key raw materials, thereby delivering advanced battery technologies at competitive prices.”
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