POSCO Holdings, Early Investment of 1.5 Trillion KRW in Phase 2 of Argentina Lithium Commercialization

Approval of Board Meeting for 25,000t Scale Lithium Operation Investment
Phase 2 Project Scheduled for Next Year to Be Advanced
Responding to Customer Requests for Expanded Lithium Supply
Final Processing as Lithium Hydroxide in Korea
Annual Production of 300,000t Planned by 2030

Panoramic view of the Argentina brine lithium pilot plant. Lithium, a key material for cathode active materials in secondary batteries, plays a role in generating and charging electricity. Photo by POSCO Holdings

[Asia Economy Reporter Choi Seoyoon] POSCO Holdings announced on the 11th that it has decided to make a second-phase investment in the commercial lithium extraction plant using brine in Argentina.

On the 7th, POSCO Holdings reported and received approval from the board of directors for the second-phase investment project to commercially produce lithium hydroxide from brine lithium at the Hombre Muerto salt lake in Salta Province, Argentina.

With the implementation of the United States' Inflation Reduction Act (IRA) leading to active investments by global secondary battery companies in the North American region, POSCO Holdings decided to advance the second-phase project, originally planned for next year, to actively respond to domestic and international customers' requests for expanded lithium supply.

The total investment cost for the second-phase project is approximately 1.09 billion USD (about 1.5 trillion KRW), and funding will be carried out by POSCO Argentina and a newly established domestic corporation.

This investment involves constructing a lithium carbonate production plant at the salt lake located at an altitude of 4,000 meters in Argentina by the end of this year, with an annual lithium hydroxide production capacity of 25,000 tons. The process of converting lithium carbonate into lithium hydroxide, which is ultimately used in battery manufacturing, will begin construction domestically in the first half of next year and is scheduled for completion in the second half of 2025.

POSCO is conducting exploration at a lithium salt lake in Argentina. Photo by POSCO Holdings

The 25,000 tons of lithium hydroxide produced through this second-phase project will be sufficient for approximately 600,000 electric vehicles and will be supplied to POSCO Chemical and domestic cathode material manufacturers.

To resolve lithium supply shortages faced by customers, POSCO Holdings plans to accelerate the third and fourth-phase investments to achieve an annual production capacity of 100,000 tons of brine lithium in Argentina early, following the first and second-phase investments. Additionally, through brine lithium, ore lithium, and recycled lithium from used batteries, the company aims to establish an annual production capacity of 300,000 tons by 2030 and become one of the top three global lithium producers.

Meanwhile, anticipating a global lithium supply shortage due to the full-scale advent of the electric vehicle era, POSCO Group proactively acquired salt lakes in Argentina in 2018. At the end of 2020, the global brine lithium consulting firm Montgomery & Associates in the United States confirmed that the lithium reserves of the acquired salt lakes were 13.5 million tons of lithium carbonate equivalent, six times the initially estimated 2.2 million tons at the time of acquisition.

Considering mining feasibility and yield, it is expected that at least 2.8 million tons of lithium can be produced. In March, construction began on the first-phase plant with an annual capacity of 25,000 tons, aiming for completion in the first half of 2024.

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