LG Energy Solution is further strengthening its supply chain for lithium, a key raw material for high-capacity electric vehicle batteries, in the U.S. Free Trade Area.
On February 14, LG Energy Solution announced that it has signed a contract with Australian lithium producer Wesfarmers Chemicals, Energy & Fertilizers (WesCEF) to supply spodumene concentrate. Lithium concentrate is a high-purity mineral that is processed and concentrated from lithium ore and used as a raw material for lithium hydroxide and lithium carbonate.
LG Energy Solution will receive 85,000 tons of lithium concentrate from WesCEF for one year. This is enough to produce 11,000 tons of lithium hydroxide and enough batteries for about 270,000 high-performance electric vehicles that can travel more than 500 kilometers on a single charge. The companies will also discuss additional supply agreements in the future.
WesCEF is a subsidiary of Wesfarmers, one of Australia's top 10 largest companies. It entered the lithium production business in 2019 with an investment in the Mt. Holland mine project in western Australia. It also established a joint venture, Covalent Lithium, with Chile's Sociedad Químicay Minera (SQM), one of the world's largest lithium producers, to jointly develop a mine and lithium hydroxide production facility.
Previously, LG Energy Solution signed a five-year contract to supply 50,000 tons of lithium hydroxide produced by WesCEF through its Mount Holland mine project starting in 2025. WesCEF's lithium hydroxide supply meets the full IRA subsidy requirements.
The two companies will continue to build on their strong strategic partnership and work together to build a robust supply chain of key minerals and raw materials in the U.S. FTA region.
In the U.S., LG is working with material partners to fulfill IRA subsidy requirements, and outside the U.S., LG is striving to build on its strengths in terms of price competitiveness and supply responsiveness.
LG Energy Solution has previously secured 25 percent of Chilean SQM and 100,000 tons of lithium hydroxide and carbonate from Canada's Green Technology Metals, and 700,000 tons of lithium concentrate from Liontown, Australia.
