Prime Minister Duck-soo Han said, “This marks a pivotal turning point for POSCO Group as it strides toward becoming a global leader in the lithium industry. The government will not spare any efforts in providing full support to the sector”

Chairman In-hwa Chang said, “POSCO Group will ensure resource sovereignty not only in steel but also in rechargeable battery materials. By securing a diverse range of lithium resources, we are paving the way to become a global top-tier lithium company through a stable domestic supply”

By building a domestic supply chain for lithium hydroxide, a key material for rechargeable batteries, POSCO has made it possible to reduce delivery times and logistics costs. POSCO Pilbara Lithium Solution will provide up to 30,000 tons per year to POSCO Future M and has signed a three-year agreement with SK On for up to 15,000 tons

POSCO Group has completed a production system capable of producing 43,000 tons of lithium hydroxide annually for rechargeable batteries, localizing a key mineral essential for the rechargeable battery industry and establishing a stable supply chain.

POSCO Pilbara Lithium Solution, a subsidiary of POSCO Group, completed the construction of its second lithium hydroxide plant, based on ore, on November 29 at the Yulchon Industrial Complex in Jeollanam-do. This milestone, achieved just one year after the completion of the first plant in November last year, establishes a total lithium production system with an annual capacity of 43,000 tons. This output represents a scale sufficient to support the production of approximately 1 million electric vehicles.

POSCO Pilbara Lithium Solution, established in 2021 as a joint venture between POSCO Holdings and Australian mining company Pilbara Minerals, imports raw lithium ore from Australia to produce lithium hydroxide for rechargeable battery materials in Korea.

▲ POSCO Group completed construction of POSCO Pilbara Lithium Solution’s second lithium hydroxide plant in the Yulchon Industrial Complex in Jeollanam-do on November 29. From the left, Korea Development Bank Chairman Seog-hoon Kang, Pilbara Minerals outside director Steve Scudamore, Australian Ambassador to Korea Jeff Robinson, POSCO Group Chairman In-hwa Chang, Prime Minister Duck-soo Han, South Jeolla Province Governor Young-rok Kim , National Assemblyman Hyang-yup Kwon, and Ministry of Trade, Industry and Energy Industrial Policy Director Seung-Yeol Lee.

The completion ceremony was attended by Prime Minister Duck-soo Han, South Jeolla Province Governor Young-rok Kim, Lawmaker Hyang-yup Kwon, Director General for Industrial Policy Seung-Yeol Lee from the Ministry of Trade, Industry and Energy, Chairman of the Korea Development Bank Seog-hoon Kang, Gwangyang Mayor In-hwa Jeong, global battery company representatives, POSCO Group Chairman In-hwa Chang, POSCO Pilbara Lithium Solution CEO Kyung-seop Lee, Australian Ambassador to the Republic of Korea Jeff Robinson, and Pilbara Minerals Independent Director Steve Scudamore.

Prime Minister Duck-soo Han remarked, “The completion of this lithium plant will be a groundbreaking turning point for POSCO Group in its journey to becoming a global leader in the lithium industry. The government will spare no effort in supporting rechargeable battery companies through comprehensive measures, including infrastructure, R&D, taxation, financing, and more.”

Australian Ambassador to the Republic of Korea Jeff Robinson said, “The comprehensive completion of POSCO Group’s lithium plant is a testament to the trust and collaboration built between Korea and Australia over many years. It is a significant milestone for both nations in the joint development of the rechargeable battery material industry.”

Chairman In-hwa Chang stated, “Amid changes in the global regulatory environment, POSCO Group has ensured a stable domestic supply of lithium, a key mineral for rechargeable battery materials, thereby opening the path to material sovereignty. Building on its leadership in steel, the group has also contributed to national prosperity in the rechargeable battery materials sector and will grow into a leading global lithium company in the future.”

In 2018, POSCO Holdings proactively acquired a 4.75% stake in Pilbara Minerals and signed a 20-year contract for the stable supply of lithium ore mined from Pilbara Minerals’ Pilgangoora mine. This measure secures a reliable raw material supply chain. Additionally, the two companies strengthened their long-term partnership by investing in POSCO Pilbara Lithium Solution, with POSCO Holdings holding an 82% stake and Pilbara Minerals owning 18%.

POSCO Pilbara Lithium Solution applied two distinct lithium extraction technologies to its plants: the first plant, completed in November last year, uses a proprietary lithium extraction technology developed by POSCO Group, while the second plant uses a commercially proven technology operated by other global companies. POSCO Group’s proprietary lithium extraction method, based on the principle of electrodialysis, offers advantages such as the recovery and reuse of byproducts during production and minimal byproduct generation. In contrast, the commercial extraction technology is universally used by leading lithium producers in Australia, China, and other countries, providing proven reliability. By operating both plants, POSCO Group aims to strengthen its technical foundation to flexibly expand its business in response to future changes in the business environment.

Moreover, the lithium hydroxide produced by POSCO Pilbara Lithium Solution is processed entirely within free trade agreement (FTA) member countries, as it uses Australian raw materials and is refined in Korea, making it free from geopolitical risks. Unaffected by changes in the regulatory environment for raw materials used in rechargeable batteries in countries such as the U.S. and the EU, it is easy to explore both domestic and international markets, leading to the successful securing of supply contracts from the early stages of operation.

POSCO Pilbara Lithium Solution plans to supply 20,000 tons of lithium hydroxide annually to POSCO Future M, the Group’s cathode material producer, starting from this amount and increasing it to a maximum of 30,000 tons in the future. On November 22, POSCO Pilbara Lithium Solution signed its first long-term contract with SK On to supply up to 15,000 tons over three years. In the future, POSCO Group aims to leverage business advantages such as shorter delivery times and reduced logistics costs from domestic lithium hydroxide production to expand its customer base both domestically and internationally.

By combining the 25,000 tons of lithium hydroxide from the first phase of its brine lithium plant in Argentina, completed earlier this year, with the 43,000 tons from its newly completed ore-based lithium plants, POSCO Group has established an annual production capacity of 68,000 tons, further strengthening its raw material capabilities for the rechargeable battery industry. Additionally, the Group is accelerating efforts to lead in next-generation materials and other innovative technologies.

Early investment to respond actively to customer demand for lithium supply…Stages 3 and 4 are also progressing rapidly to produce 100,000t annually

Lithium carbonate will be produced in Argentina, then undergo final processing to lithium hydroxide in Korea

The salt water, ore, and dead battery lithium businesses are expected to produce 300,000t/year by 2030

POSCO Holdings decided to invest in the second stage of a salt water lithium commercialization factory in Argentina.

On Oct. 7, POSCO Holdings reported the second investment business to its board and they approved the production of lithium hydroxide with salt water in Argentina. POSCO Holdings decided to start the second stage of the business now instead of next year due to increased demand for lithium at home and by foreign customers amid booming investment in secondary battery sector with the start of IRA from the United States.

The total amount of the investment is about $1.09 billion (about KRW 1.5 trillion), and financing will be conducted by POSCO Argentina and a newly established domestic corporation.

This investment is equal to 25,000t of lithium hydroxide, and a factory will be built on a salt lake in Argentina, and the production of lithium carbonate for lithium hydroxide for use in final battery manufacturing will begin in the first half of next year and will be completed in the second half of 2025.

The 25,000t of lithium hydroxide produced by the second business is on the scale of 600,000 electronic vehicle units, and it will be supplied to POSCO Chemical and domestic companies.

POSCO Holdings has a plan to speed up investment in the third and fourth stages for early production of 100,000 tons per year of salt water lithium in Argentina to solve the problem of customers’ insufficient supply. Engaging in business of salt water and ore based lithium, waste battery recycling, and so on, POSCO Holdings aims to enter the global top 3 with a production system of 300,000 tons by 2030.

POSCO Group acquired the salt lake in Argentina in advance and the Montgomery & Associates, a global consulting firm specialized in salt water lithium, verified that the estimated deposits of lithium at the lake amounts to 13.5 million tons, six-fold the amount that was initially estimated before the acquisition. Considering mining possibility and yield rate, it is expected to produce a minimum of 2.8 million tons. Construction of the first stage factory, which will produce 25,000 tons annually, began in March 2021 and the target is to complete it by the first half of 2024.

▲ The trial factory for salt water lithium in Argentina. Lithium is a key material in secondary battery cathode materials.

▲ POSCO is exploring lithium in a salt lake in Argentina.