A view of the Gumi plant of POSCO ESM producing positive electrode. (Photo: POSCO)

POSCO plans to pour 113 billion won in a project to build a positive electrode plant. The move is designed to strengthen the material business POSCO, which it aims to nurture as a future growth engine. POSCO is also seeking to acquire a salt lake to secure the raw material of positive electrodes, with the goal of taking a 20 percent share in the global secondary battery raw material market.
POSCO ESM, a subsidiary of POSCO, signed a deal with the Gwangang Bay Free Economic Zone (GBFEZ) Authority on May 29 to buy a 165,287 square-meter site for a positive electrode plant.
POSCO ESM plans to set up the positive electrode plant capable of producing 6,000 tons annually by next year and expand its annual production capacity to 50,000 ton by 2022. When the expansion is completed, the plant is forecast to post more than 2 trillion won in annual sales and create more than 1,000 jobs.
POSCO ESM’s annual positive electrode production capacity, including that of the Gumi plant’s production capacity of 12,000 tons, is predicted to rise to 62,000 tons by 2022, which is equivalent to those producing 1 million EV units. The company also plans to build another plant capable of producing 20,000 tons of nickel at a second battery material complex in Gwangyang.
The global positive electron market is forecast to jump to 860,000 tons by 2020, a more than four-fold surge from 210,000 tons in 2016 on the back of a rise in the demand for EVs, energy storage systems and IT batteries.
Posco KemTech, a negative electrode maker, is seeking to secure mineral resources through inter-Korean economic cooperation projects. The company aims to import graphite, a raw material of negative electrode, from North Korea. North Korea’s graphite reserves are estimated at 2 million tons. It is expected to have an effect of displacing imports from China, whose environmental regulations have adversely affected prices and supply.
POSCO has decided to acquire a salt lake mine in Salardel Hombre Muerto, Argentina from the Australian resources developer Galaxy Resources. The price of the acquisition is estimated at 300 billion won. Galaxy Resources presumes the mine has an estimated 2.5 million tons of nickel reserves. POSCO plans to secure about 25,000 tons of nickel from the development of the salt lake.
POSCO plans to enhance efficiency by making the most of the PosLX, a lithium extraction technology developed by the company on its own.
POSCO and Galaxy Resources agreed on a term sheet on the acquisition on May 28 before a contract is made. The acquisition process is to be completed soon with the pending approval by its board of directors.
POSCO is scrambling to secure nickel as the company has signed a long-term contract to buy a lithium mine by acquiring a stake from the Austalianmine developer Pilbara in February.
Lithium is dubbed “white gold” because the demand for secondary batteries is surging. Lithium prices rose to $21,000 per ton in April 2018, over three times more than $6,000 in 2015.