POSCO Holdings will invest about 1.2172 trillion won to secure lithium resources in Australia and Argentina to strengthen the competitiveness of raw materials for secondary battery materials. It is part of POSCO Group's secondary battery materials business strategy to strengthen cost competitiveness and secure stable raw materials at the same time through swift and aggressive investment in global lithium resources.
On the 11th, POSCO Holdings signed a deal to acquire 30% equity in a new intermediate holding company to be established by Australian mining company Mineral Resources. The investment amounts to about $765 million (about 1.1219 trillion won).
Through this investment, POSCO Holdings will stably secure 270,000 tons a year of lithium concentrate from the Wodgina mine and the Mt. Marion mine that Mineral Resources operates in Western Australia. This figure reflects the two mines' production expansion plans and is enough to produce 37,000 tons of lithium hydroxide. That is enough for about 860,000 electric vehicles.
POSCO Holdings said, "Strategic equity investment in Australian lithium mines makes it possible to participate in mine management and secure dividend revenue," and added, "During the market's full-fledged growth phase, we plan to pursue phased business expansion that links to the lithium concentrate smelting business."
POSCO Holdings is also accelerating the securing of brine lithium. On the 5th, POSCO Holdings decided to invest $65 million (about 95.3 billion won) to acquire 100% equity in the Argentine subsidiary of LIS (Lithium South), a Canadian resource development company that holds mining rights (the rights to mine and develop minerals deposited in the salt lake) within the Hombre Muerto salt lake in Argentina.
POSCO Holdings, which acquired major mining rights in the Hombre Muerto salt lake in 2018, will secure additional resources and land in the Hombre Muerto salt lake, which holds world-class lithium deposits, through the acquisition of the adjacent mining rights. POSCO Holdings expects high synergy with its existing lithium business underway in Argentina, as it can actively leverage the already established infrastructure and operating know-how.
Chang In-hwa, chairman of POSCO Group, said, "To leap to become the world's No. 1 lithium company, securing raw material competitiveness is more important than anything else, so we will diversify the global lithium supply chain through aggressive investment."
Chris Ellison, CEO of Mineral Resources, said, "We are pleased that the strong partnership with POSCO Group that began with the Onslow iron ore mine project in Western Australia has expanded into the lithium business," and added, "We look forward to continuing to create value at the Wodgina and Mt. Marion mines by combining each company's capabilities."