Posco’s piles of lithium are silvery-white gold

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Posco’s piles of lithium are silvery-white gold


Ken Brinsden, CEO of Pilbara Minerals, left, explains the mining process at Pilgangoora mine in Pilbara, Western Australia, earlier this month. [POSCO]

PILGANGOORA, Western Australia - Posco is betting big on lithium for its future business as the metal is the key ingredient of the lithium-ion batteries used in electric cars and a range of mobile devices. Korea’s largest steelmaker projects that demand for lithium will grow from roughly 270,000 tonnes (297,624 tons) this year to 710,000 tonnes by 2025.

Due to the high potential, Posco has had its eye on lithium since the late 2000s, and in 2010, it even developed its own technology to extract lithium from salt brine. Despite the technology, the development of the lithium business has been slow going as the steelmaker struggled to find a stable supply of lithium, whether through brine or hard rock mines.

The delays caused some industry insiders to doubt Posco’s investments in the lithium business.

A deal with Australian miner Pilbara Minerals in February changed all that. The lithium miner signed a deal to supply 80,000 tonnes of lithium-rich spodumene concentrates - a hard rock source of lithium - per year to Posco, with the Korean company acquiring 4.75 percent of the mining company at 79.5 million Australian dollars ($58.1 million).

When the two ink a deal to establish a joint venture focused on lithium production, annual supplies could increase to as much as 240,000 tonnes per year, according to Posco, though talks over the deal are ongoing.

With the deal, Posco is ramping up the growth of its lithium business.

When the Korea JoongAng Daily visited the Pilgangoora mine site on Nov. 21, miners were working in excavators and trucks to deliver spodumene ore - a hard rock that contains high levels of lithium - from a round pit. Like in other open-pit mines, miners drill holes several meters down, fill them with explosives, and then blow them up to expose the rocks. Unlike at Posco’s iron ore mine, also in western Australia, the rocks here were covered in a distinctive silvery-white sheen of lithium.

The collected rocks are crushed and processed into coarse and fine spodumene concentrates, which are stockpiled to be delivered to customers like Posco that actually extract the lithium from the rock through chemical processes. The spodumene concentrate stockpiles looked like mountains of salt from afar, but Posco considers it more like gold than salt, due to the alkali metal’s soaring value.

Ken Brinsden, managing director and CEO of Pilbara Minerals, had high expectations for Posco’s lithium business and touted the Korean company’s high level of technology.

“It makes such pure hydroxide products,” Brinsden said. “I think, in my view, [Posco’s lithium products] would easily be the best available in the Korean market and one of the best, if not the best, in the world’s market.”

According to Posco, it uses technology that is different from other manufacturers that reduces impurities to one third of competing products.

The Pilbara CEO also said Posco is well placed to take advantage of the battery makers in Korea.

“U.S. and European automakers are deliberately sourcing batteries from Korean battery makers for their technology,” he said. “So we think Posco has a pre-eminent position by being able to support quality in the [battery] supply chain.”

While domestic battery makers have been dependent on lithium imports, the mass production of lithium products by Posco could contribute to lowering battery materials costs.

As Posco also succeeded in acquiring lithium mining rights for 17,500 hectares of salt brine in Argentina in August, its lithium production will be further ramped up from 2021 when it starts producing roughly 25,000 tonnes of lithium per year there.

According to the steelmaker, it will be producing a total of 55,000 tonnes of lithium by 2021, enough to make batteries for roughly 1.2 million electric cars.

BY KIM JEE-HEE [kim.jeehee@joongang.co.kr]
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