The B2B platform for full-electric and plug-in hybrid electric vehicles: Industry News

For the first time, Korea participates in the overseas exploration of lithium: Korea Resources Corp. is investing $15 million in an exploration and feasibility study at an Argentinean lithium brine deposit for a 30% stake in a joint venture with the Canadian Lithium One, falling in line with a number of international constellations that apportion the worldwide lithium market.

In their rush to secure reliable sources of lithium, which is seen as key resource for the future expansion of the electric vehicle market, battery suppliers and car manufacturers form strategic alliances with mineral exploration companies. The most recent formation of the kind, is the joint venture between Korea Resources Corp., in short Kores, and the Canadian Lithium One Inc. to develop a lithium mine in the north of Argentina.

Kores, owned by the South Korean government, had announced at the end of May 2010 to form a consortium with GS Caltex and LG International Corp. that would invest $15 million in the exploration as well as a feasibility study at the Sal de Vida lithium brine deposit for a 30% stake in a joint venture with Lithium One. Kores would base the decision on whether or not to participate in the development of the deposit on the results of this exploration study.

The terms of the joint venture foresee that if the mine is developed, the Korean consortium will have over the next 50 years buying rights on half of the 12,000 tons of annual lithium carbonate production from the site and will hold the exclusive right to sell the lithium in China, Japan and Korea. Lithium One on the other hand will reserve the right to sell worldwide all the mine's potash and boron products, which are byproducts from the lithium extraction.  

International alliances targeting South America

The Australian Orocobre Ltd. and the Japanese Toyota Tsusho Corp. (which is 21.8% owned by Toyota Motor Corp.) have agreed on a similar arrangement. Toyota Tsusho will finance the completion of a feasibility study during 2010 on a lithium project in the north of Argentina operated by Orocobre. Tusho will then take a 25% stake in the project. The investment is said to value $100 million to $120 million.

Another Canadian, Lithium Americas Corp., and Mitsubishi have entered into a memorandum of understanding, setting out in general terms both parties' intentions on co-developing and commercialising the Cauchari-Olaroz lithium reserves in Argentina. Mitsubishi is financing a brine study for the recovery of lithium from Lithium Americas’ lithium brine and further exploration of the technology will be decided on the basis of the study's results.

Strong market uptake predicted

Demand for lithium is soaring in the global market as lithium secondary batteries are core components in hybrid and other green automobiles. The demand is expected to further rise dramatically with growing numbers of mass-marketed electric vehicles. Experts estimate that with only 5% to 10% of all newly produced cars being electric, lithium consumption would double over the next 10 years.

Currently, over half the world's lithium output comes from mines in Chile and Argentina. The world's largest lithium brine reserves, however, are situated in Bolivia's high altitude Uyuni salt flats. The Bolivian government has announced to invest about $350 million into the construction of lithium processing plants that are planned to be operational in 2013.