LG Energy Solution (LGES) announced that it has secured 100% rights to battery-grade nickel and cobalt materials from Australian Mines, amid growing concerns about future supplies of raw materials.
The company has entered into a binding long-form offtake agreement today with Australian Mines for nickel and cobalt, which will be supplied in mixed hydroxide precipitate (MPH) from the Sconi Project North Queensland.
Valued at $ 1.5 billion, the Sconi Project is a nickel and cobalt mine capable of creating quality battery materials and boost the battery supply chain.
According to the agreement, the battery manufacturer will have access to 71,000 tonne of nickel and 7,000 tonne of cobalt for six years starting from the end of 2024.
The six-year supply will help LG produce batteries that can power 1.3 million high-performance electric vehicles, with a driving range surpassing 500 kilometres on a single charge.
Cooperation with Australian Mines will also help LGES gain the upper hand in securing a stable supply of critical ingredients for EV batteries, as a race to procure raw materials for EV batteries became fierce amid the growing global demand for EVs.
The battery maker said that it also opts to raise its competitiveness in ESG management in acquiring raw materials.
Australian Mines will be using dry stacking during the mining procedure, a sustainable method used to store filtered tailings. The dry stacking method eliminates storage ponds and dams associated with conventional tailings facilities, which is an eco-friendly method used to store filtered tailings.
Jong-hyun Kim, President & CEO, LGES, said, 'Securing key raw materials and a responsible battery supply chain has become a critical element in gaining a greater control within the industry, as the demand for electric vehicles worldwide heightened in recent years. LGES will solidify its position as the world's leading battery manufacturer through a steady supply of raw materials for EV batteries.'
NB: Photo is representational.