Korea-based POSCO Holdings recently started construction of a lithium commercialization plant in Argentina. (Earlier post.) POSCO Group is the first to produce lithium hydroxide for batteries in Argentina throughout the entire process from the acquisition of mining rights to exploration, construction and operation of a production plant.
Construction of the brine lithium plant is to be completed in the first half of 2024, with annual production of 25,000 tons of lithium hydroxide. The total investment cost is about US$830 million (about KRW 0.95 trillion) including infrastructure investment and operating funds.
Operation of the lithium plant and financing will be 100% carried out by POSCO Argentina, a subsidiary of POSCO Holdings. POSCO Group plans to increase mass production to 50,000 tons from the end of 2024 with an additional investment in annual production of 25,000 tons in the second phase of the lithium project, which will begin construction on the same day. Production is expected to be increased by stages to a maximum of 100,000 tons by 2028.
This brine lithium project will become the foundation of the secondary battery material business of POSCO Group. By stably securing a large volume of lithium, a raw material for cathode materials, the entire value chain of POSCO Group’s secondary battery material business will be enhanced.—POSCO Group CEO Jeong-woo Choi
The 25,000 tons of lithium hydroxide produced by POSCO Group can be used for about 600,000 electric vehicles. If the production amount is increased to 100,000 tons, it can be used for about 2.4 million electric vehicles.
With the recent surge in global demand for electric vehicles, battery companies around the world are striving to secure lithium, and POSCO Group’s preemptive acquisition of a large amount of lithium has strengthened POSCO Chemical’s competitiveness in the anode material business.
POSCO Group preemptively acquired the salt lake of Argentina in 2018 in response to the prospect of a global lithium supply shortage due to the full-fledged electric vehicle era, and in 2020 confirmed with Montgomery & Associates, a global US lithium consulting company, that its lithium reserves were 13.5 million tons based on 2.2 million tons estimated at the time of acquisition.
Considering the mining potential and yield, it is expected to produce at least 2.8 million tons of lithium. In addition, the lithium concentration of the salt lake is the highest among salt lakes in Argentina at 921 mg/L and the concentration of impurities such as magnesium is relatively low, so it is evaluated to have the best productivity in the world.
Also, by applying the lithium extraction technology POSCO Group has developed independently, the production time was reduced significantly and yield was improved.
The recent surge in lithium prices has led to a five-fold increase (market price per ton of lithium) compared to the acquisition time, and a cumulative operating profit of tens of trillions of won is expected to be achieved considering the 50% operating profit ratio of the lithium mining industry.
POSCO Group plans to become one of the top three global lithium production companies by 2030 based on salt, ore and waste battery recycling at the group level, including POSCO Argentina, POSCO Lithium Solution, and POSCO HY Clean Metal, with POSCO Holdings at the center.
Also, because a solid electrolyte production line began to be established in March through a joint venture between POSCO JK Solid Solution and Jeong Kwan, a company that has production technology for solid electrolyte, POSCO Group is expanding its secondary battery material business to the area of next-generation solid-state batteries.