KUCHING: Australia-based Element 25 Pte Ltd is planning a major investment in a manufacturing plant in Sarawak to produce high purity manganese sulphate (HPMSM) for lithium-ion batteries used by electric vehicles (EVs).
HPMSM is the highest purity “battery grade” manganese chemical used in lithium-ion batteries.
Element 25, which is listed on the Australian Securities Exchange, has proposed to invest A$300mil to A$400mil (RM904mil to RM1.21bil) in the project.
The company’s top executives presented the proposal to Sarawak Deputy Premier and Minister of International Trade and Investment Datuk Amar Awang Tengah Ali Hasan and his delegation at a recent roundtable networking session with Australia Malaysia Business Chamber Western Australia in Perth.
During the meeting, Element 25 briefed the Sarawak delegation on the proposed investment in the manufacturing plant.
Element 25 managing director Justin Brown and development manager Neil Graham had met Awang Tengah here in May to express the company’s interest to invest in the HPMSM manufacturing project.
The company has then proposed to undertake a feasibility study for the project as it noted that Sarawak is interested in EVs and already has a copper foil producer in Kuching.Element 25 is the operator of the Butcherbird manganese project, which hosts a resource of more than 263 tonnes of manganese ore.
The company recorded its first commercial shipment of manganese concentrate in July 2021, according to the company’s 2021 annual report.
Under a take-or-pay offtake arrangement, Element 25 is selling 100% of the manganese ore produced (up to 400,000 tonnes per annum) to OM Materials (S) Pte Ltd (wholly-owned by OM Holdings Ltd), which owns and operates a ferroalloy and manganese smelting plant in Samalaju Industrial Park, Bintulu.
In addition to the manganese concentrate export business, Element 25 has completed extensive research and development and laboratory test work into the production of high purity manganese products, including battery grade HPMSM and high purity electrolytic manganese metal (HPEMM).
The work, said Element 25, has highlighted that the Butcherbird ores are highly amenable to an ambient temperature, atmospheric pressure leach process, resulting in an efficient extraction of the manganese into solutions – the key requirement for the cost effective and sustainable production of HPMSM and HPEMM.
“Element 25 is looking towards the future through pursuing stage two expansion of Butcherbird and opportunities to produce value added products, including HPMSM for EV batteries to power the global transition away from fossil-fuel-powered mobility.
“Manganese is emerging as an increasingly important ingredient for EV batteries, with the potential supply constraints for nickel and cobalt forcing battery manufacturers to look to high manganese cathodes to produce a vast amount of cathode material required for the EV industry,” said the annual report.
In welcoming the planned investment, Awang Tengah said the adoption of environmentally friendly technologies, including lithium-ion batteries for EV, is gaining popularity due to decarbonisation.
“Sarawak welcomes manufacturing activities as they are in line with our Post-Covid-19 Development Strategy 2030 that aims to achieve a high-income economy.”
Awang Tengah said with the ongoing Russia-Ukraine conflict, the strategic location of Sarawak will become more prominent to attract foreign direct investment in the manufacturing sector.
During the roundtable meeting, Awang Tengah hoped for more potential investments in Sarawak by Australian companies by strengthening the collaboration in business and trade between Sarawak and Western Australia.
He said total trade between Sarawak and Australia in 2021 amounted to A$1.1bil (RM3.32bil).
Sarawak exported RM1.2bil worth of goods, mainly crude petroleum, plywood and urea, to Australia last year and imported mainly aluminium ores and concentrate from Australia.