The Korean Government and the nation’s largest steelmaker signed an agreement for a joint research and development project to extract lithium from sea water. The aim is to produce up to €750 million worth lithium carbonate a year by 2015.

This Tuesday, 2 February, the South Korean Government signed a deal with leading steelmaker POSCO to develop a technology to collect lithium from sea water. According to POSCO, the Ministry of Land, Transport and Maritime Affairs and the steel company will invest a combined 30 billion Won (€18,8 million) over the next five years to help the Korea Institute for Geoscience and Mineral Resources (KIGAM) build the lithium-extraction plant by 2014.

The ministry and KIGAM started a project to develop technology to abstract marine dissolved resources in 2000, and came up with the lithium-collecting method in May last year. At the same time Japan is working on a similar technology, however, the Korean technology is 30 percent more energy efficient than that of Japan, a ministry spokesman said.

Global supply stability

The plan is to build a pilot plant already this year and to develop a core production line for a lithium extraction plant in 2011-2012. A commercial lithium extraction plant is scheduled for 2013-2014 and will be able to annually produce 20,000-100,000 tons of lithium carbonate from 2015.

All partners involved expect the new plant to contribute notably to the nation's resource industry reducing Korea’s dependency on Lithium imports. The Land Ministry revealed that currently Korea imports 5,000 tons of lithium carbon p.a. but is forecasted to grow significantly in the coming years. If annual production reaches the 100,000 tons mark, as planned, it will be enough to reverse the current dependency and make Korea to a net exporter. It is hoped that Korea could export up to €750 million worth lithium carbonate p.a.

Jeff Kang, an analyst with Daeshin Securities, points towards the positive signs this will have for battery suppliers and EV manufacturers stating that as "there hasn't been lithium shortage to date. A stable supply will be very important once the demand for electric cars surges.”