Australian lithium developer, Pilbara Minerals Limited (ASX: PLS) has signed a non-binding MoU to investigate a potential joint venture for a downstream lithium chemical conversion facility servicing South Korea’s rapidly growing lithium-ion battery industry.
The agreement will see Pilbara commence preliminary discussions with Polaris Shipping and leading South Korean conglomerate LG Chem. Polaris Shipping has incorporated Lithium Korea as a special-purpose corporation targeting, the participation of both Pilbara Minerals and LG Chem.
Polaris Shipping has also recently announced that it has signed a MoU with the Saemangeum Development and Investment Agency (SDIA) in support of the Lithium Korea chemicals development. SDIA is the lead government agency for the Saemangeum Industrial Complex, the proposed location of the downstream Lithium Chemicals Facility.
Pilbara Minerals’ Managing Director and CEO, Ken Brinsden, said that while discussions are at an early stage, further discussions with Polaris Shipping and LG Chem may lead to commercial terms being agreed and a formal joint venture being established for the downstream project.
Mr Brinsden said the MOU presented an opportunity for Pilbara’s participation in one of the world’s most exciting and fastest growing markets for lithium raw materials outside of China.
“South Korea is a major global economic and industrial power with a very large and rapidly growing high-technology industrial complex and automotive industry. Discussions like these present an opportunity to work alongside two of South Korea’s leading conglomerates to participate in the development of a world-leading downstream lithium chemicals facility servicing the rapidly growing lithium-ion battery industry in South Korea,” he said.
“This is consistent with our broader objective as a company to participate in downstream chemical facilities where this makes sense for us as an upstream supplier of spodumene concentrates, and to diversify our global sales arrangements.
“Given the scale of the existing Resource and Reserve at Pilgangoora – and the potential to continue to grow it with ongoing drilling – we have plenty of capacity to support both our existing customers in China and new customers elsewhere. It’s fair to say that Korean lithium raw material demand is now well and truly on the radar,” Mr Brinsden said.