LG

By becoming the first Korean battery materials company to secure North American spodumene concentrate (“SC6”), LG Chem began to strengthen its supply chain. SC6 is a high-purity material that processes lithium ore, which can extract lithium hydroxide that serves as a key material for batteries.
 
On the 15th, LG Chem announced that it signed offtake agreements with an American mining company Piedmont Lithium Inc. (“Piedmont”) for a total of 200,000 metric tons of SC6. Starting in 3Q23, Piedmont will supply 50,000 metric tons per year of SC6 from a Canadian mine over a four-year term. LG Chem is expected to extract approximately 30,000 metric tons of lithium hydroxide, which is equivalent to the amount that goes into 500,000 high-performance electric vehicles.
 
Piedmont has a 25% ownership interest in the North American Lithium (“NAL”) - Canadian mine in Quebec, and NAL is the only lithium mine in North America capable of commercial production this year. LG Chem plans to use the lithium mined in the region to produce cathode materials supplied to key North American customers.
 
LG Chem became the first Korean battery materials company to secure SC6 from North America. With the use of North American lithium, LG Chem fulfills the US IRA (Inflation Reduction Act, passed by the US Congress) and expects to mitigate the regional concentration of key materials for secondary batteries.
 
LG Chem also signed an agreement with Piedmont to make an equity investment of $75 million (KRW 94 billion), earning an approximately 6% stake in the company. LG Chem further stabilized its raw materials supply by obtaining priority negotiation rights for 10,000 tons of lithium hydroxide per year produced by Piedmont Lithium in the U.S.
 
Established in 2016, Piedmont is a lithium mining company headquartered in North Carolina, USA. Piedmont is listed on both Nasdaq and Australian Securities Exchange, with lithium mine development and production projects underway in North Carolina and Tennessee. Piedmont also has stakes in lithium mine developers in Quebec, Canada, and Cape Coast, Ghana.
 
Keith Phillips, CEO of Piedmont, said “We are pleased to partner with LG Chem to supply lithium resources produced in North America,” adding that “As LG Chem has a strong commitment to US electric vehicle battery manufacturing, Piedmont looks forward to discussing additional potential cooperation with LG Chem in North America.”
 
LG Chem has been partnering with a wide range of global raw materials companies, including Piedmont, to secure stable raw materials supply and cost competitiveness. LG Chem also made a strategic equity investment in Tianqi Lithium, a company that owns a mine in Australia. Moving forward, LG Chem plans to continue its investment to secure key battery materials that satisfy criteria laid out in the US IRA and RMA (Critical Raw Materials Act) in Europe.
 
LG Chem’s Chief Executive Officer Hak Cheol Shin mentioned “This agreement allows LG Chem to provide differentiated values to North American customers with products that satisfy IRA standards by preemptively securing raw materials in the US, our key market,” adding that “We will lead the battery material market by building various partnerships, including joint metal investments with automotive OEMs and battery makers.”