85,000t Lithium Ore... Enough for About 270,000 High-Performance Electric Vehicles
LG Energy Solution has signed a lithium supply contract with an Australian lithium producer, strengthening its lithium supply chain within the United States and Free Trade Agreement (FTA) regions to receive subsidies under the U.S. Inflation Reduction Act (IRA).
On the 14th, LG Energy Solution announced that it had signed a lithium concentrate supply contract with the Australian lithium producer WesCEF. Lithium concentrate is a high-purity mineral processed from lithium ore and serves as the raw material for lithium hydroxide and lithium carbonate.
LG Energy Solution plans to receive 85,000 tons of lithium concentrate from WesCEF this year. This amount corresponds to 11,000 tons of lithium hydroxide, enough to produce batteries for approximately 270,000 high-performance electric vehicles capable of driving over 500 km on a single charge. The two companies also plan to discuss additional supply contracts in the future.
WesCEF is a subsidiary of Wesfarmers, one of Australia's top 10 companies. It entered the lithium production business in 2019 by investing in the Mount Holland mine project located in Western Australia. WesCEF has established a joint venture with Chile's SQM, one of the world's largest lithium producers, to jointly develop mining and lithium hydroxide production facilities.
LG Energy Solution previously signed a contract to receive 50,000 tons of lithium hydroxide annually for five years starting in 2025 from WesCEF's Mount Holland mine project. All lithium hydroxide supplied by WesCEF meets the IRA subsidy requirements.
Based on a solid strategic partnership, the two companies plan to cooperate in building a robust supply chain for key minerals and raw materials within the U.S. FTA region.
LG Energy Solution is striving to establish a structural management environment that can stably procure key raw materials even in the event of unpredictable supply chain shocks. So far, it has secured 25% of lithium concentrate produced in Canada by Australia's Green Technology Metals, 100,000 tons of lithium hydroxide and lithium carbonate from Chile's SQM, and 700,000 tons of lithium concentrate from Australia's Liontown.
Lee Kang-yeol, Executive Vice President and Head of Purchasing Center at LG Energy Solution, said, "As a global battery leader, we plan to enhance the value of sustainability across our business, including products and supply chains, in line with the global electrification trend and clean energy policies. We will expand strategic partnerships with promising companies like WesCEF to stably secure key raw materials and further manufacture batteries at competitive prices."
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