LG Energy signs 2nd agreement with WesCEF to expand lithium supply

An employee walks past the logo of LG Energy Solution at its office building in Seoul, South Korea, November 23, 2021. Picture taken November 23, 2021. REUTERS/Kim Hong-Ji/File Photo

(Reuters) - South Korea's LG Energy Solution signed their second offtake agreement with Australia's Wesfarmers Chemicals, Energy and Fertilisers (WesCEF) on Tuesday to expand its supply chain for lithium procurement.

As a part of this collaboration, WesCEF will supply 85,000 tons of lithium concentrate to LG Energy, which can produce about 11,000 tons of lithium hydroxide.

The offtake agreement comes after LG Energy struck a deal for 50,000 tons of WesCEF's battery-grade lithium hydroxide in 2022.

WesCEF's lithium hydroxide will be produced from the Mt. Holland lithium project in Western Australia, currently under construction and expected to commence operations by the first half of 2025.

Last week, LG Energy, the biggest supplier of battery cells to electric scooter makers in India, said it plans to grow its presence in the country's passenger vehicle market.

The company's India unit dominates the supply of battery cells to domestic e-scooter makers such as SoftBank Group -backed Ola Electric and domestic rival TVS.

In 2023, the South Korean company signed a supply deal with Chile's SQM to source 100,000 tons of lithium for seven years.

Lithium is widely used in a variety of industries, particularly rechargeable lithium-ion batteries, which power everything from smartphones and laptops to electric vehicles and grid-scale energy storage systems.

(Reporting by Daksh Grover in Bengaluru; Editing by Chris Reese)

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