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According to LG Chem’s statement, the joint venture will invest 200 billion Won ($161,043,620) in a facility at the Onsan Industrial complex in Ulsan, South Korea.
The facility will be constructed as an exclusive line for nickel cobalt manganese aluminum (NCMA) precursors that will be used in the production of next-generation electric vehicle (EV) batteries manufactured in LG Chem’s Cheongju Cathode Materials Plant, the statement said.
Construction at the facility will begin in July 2022, with full production expected to start in the second quarter of 2024.
According to the announcement, Kemco will own 51% of the joint venture, while LG Chem will own the remaining 49%.
LG Chem said it expects production capacity at the plant to be 20,000 tonnes per year. The NCMA precursors will be manufactured from metals produced by Kemco as well as recycled metals extracted from waste scrap and waste batteries.
With this joint venture, LG Chem aims to establish a stable supply of high-quality nickel sulfate and to procure recycling capacities, while Kemco aims to gain a stable client in the domestic market while it expands its battery materials business portfolio, the companies said in the statement.
LG Energy Solution is South Korea’s largest EV battery manufacturer. Kemco, meanwhile, is a substantial nickel sulfate producer with 80,000 tpy production capacity.
“This joint venture is very meaningful in that our platform is becoming strengthened to become the world’s best comprehensive battery materials company,” Hak Cheol Shin, LG Chem’s chief executive officer, said. “We will achieve ceaseless growth in the eco-friendly battery materials business through bold investments and collaboration.”
Kemco CEO Choi James Soung said previously nickel produced by Kemco was exported. “Based on our world-leading metal smelting capabilities, we will contribute to the localization of precursors, which is the missing link in the Korean battery industry,” he said.
On Tuesday May 31, LG Chem announced another joint venture with Tianjin B&M Science and Technology, a subsidiary of Chinese battery materials manufacturer Huayou Cobalt that specializes in cathode materials.
On April 21, the lithium-ion recovery company Li-Cycle announced it signed agreements with LG Chem and LG Energy Solution to supply the companies with 20,000 tpy of recycled nickel.
Fastmarkets’ monthly assessment for nickel sulfate, cif China, Japan and Korea was $6,676 per tonne on Wednesday June 1, down by 15.56% from .$7,869 on May 3.