LG Chem-Korea Zinc Establish 200 Billion KRW Investment Joint Venture for Precursors

Establishment of Precursor Plant in Onsan Industrial Complex in 2024
Securing Annual Production Capacity of Over 20,000 Tons of Precursors

Vice Chairman Shin Hak-cheol of LG Chem (right) is taking a commemorative photo with Choi Nae-hyun, CEO of Kemco, after signing a joint venture establishment agreement at the headquarters of Korea Zinc in Nonhyeon-dong, Seoul on the 31st.

[Asia Economy Reporter Oh Hyung-gil] LG Chem is establishing a joint venture to produce precursors, which are raw materials for battery cathode materials, by investing 200 billion KRW with Korea Zinc.

LG Chem announced on the 2nd that it signed a joint venture establishment agreement with Kemco, a subsidiary of Korea Zinc, at Korea Zinc's headquarters in Nonhyeon-dong, Seoul, on the 31st of last month.

The joint venture will be named "Korea Precursor Co., Ltd.," with Kemco holding 51% and LG Chem holding 49% of the shares. It will be located in LG Chem's dedicated NCMA (Nickel-Cobalt-Manganese-Aluminum) precursor production line for next-generation electric vehicle batteries in the Onsan Industrial Complex, Ulsan.

The two companies plan to invest a total of more than 200 billion KRW by 2024 to secure an annual production capacity of over 20,000 tons of precursors, including the application of recycled metals. Construction will begin in July, and mass production will start from the second quarter of 2024, supplying products to LG Chem's Cheongju cathode material plant. The expected sales in 2025 are approximately 400 billion KRW.

Precursors are manufactured by combining nickel, cobalt, manganese, aluminum, and other elements, and they account for about 70% of the raw material cost of cathode materials.

The joint venture will produce precursors using not only metals produced and supplied by Kemco but also recycled metals extracted from scrap and waste batteries.

In particular, the recycling process will combine dry and wet methods to maximize metal recovery rates compared to existing processes. An eco-friendly process will be introduced that minimizes harmful substance emissions, including wastewater recycling during extraction, proactively responding to global environmental regulations.

Shin Hak-cheol, Vice Chairman of LG Chem, said, "This joint venture is highly significant in strengthening the foundation to become the world's best comprehensive battery materials company," adding, "We will create continuous growth in the eco-friendly battery materials business through bold investments and collaboration."

This content was produced with the assistance of AI translation services.