US lithium hydroxide producer Piedmont Lithium and Korean battery materials maker LG Chem did a deal in which LG Chem takes a $75 million equity stake in Piedmont.
LG Chem also committed to taking 200,000 tonnes of spodumene concentrate (SC6) from Piedmont’s jointly-owned North American Lithium over a four-year term.
Piedmont has agreed to supply LG Chem with 50,000 tonnes per year of SC6 for four years. Shipments will begin in Q3 2023 and SC6 pricing will be linked to SC6 market prices at the time of each shipment.
The Koreans will utilise the material to support plans to produce cathode materials for key North American customers as well as the intentions of the Inflation Reduction Act.
Piedmont agreed to provide LG Chem priority negotiation rights for 10,000 tonnes per year of lithium hydroxide produced by Piedmont at either of its proposed facilities in Tennessee or North Carolina.
LG Chem will purchase 1,096,535 newly issued shares in Piedmont at an approximate price of $68.40 per share. It will result in a holding of some 5.7% of Piedmont common shares.
Hak-Cheol Shin, Vice Chairman and CEO of LG Chem, said: “This agreement allows LG Chem to provide differentiated values to North American customers with products that satisfy IRA standards by pre-emptively securing raw materials in the US, our key market.”
Shin said the company is building various partnerships, including joint metal investments with automotive OEMs and battery makers.
Piedmont said it intends to utilise the funding from LG Chem on its portfolio of projects, including its planned 30,000 tonnes-per-year lithium hydroxide project at Tennessee Lithium, the Ewoyaa Lithium Project in Ghana in partnership with Atlantic Lithium, and the fully integrated Carolina Lithium project in development in North Carolina.