LG Energy Solution announced on the 8th that it has signed a long-term lithium concentrate supply contract with Elebra Lithium, a North American lithium producer.
Under this contract, LG Energy Solution will receive a total of 240,000 tons of lithium concentrate over four years starting from the end of this year. This quantity is equivalent to approximately 30,000 tons on a lithium hydroxide basis, sufficient to produce batteries for about 700,000 high-performance electric vehicles. The material will be produced at the North American Lithium (NAL) mine operated by Elebra Lithium in Quebec, Canada.
Lithium concentrate is a raw material obtained by processing and concentrating lithium ore, which is then refined into lithium carbonate and lithium hydroxide. Lithium carbonate is primarily used in LFP (lithium iron phosphate) and ternary batteries, while lithium hydroxide is mainly used in high-performance high-nickel ternary batteries.
LG Energy Solution explained that the significance of this contract lies in securing the front end of the value chain—spanning raw materials (lithium concentrate), materials (lithium carbonate and lithium hydroxide, cathode materials), and batteries—locally in North America. Having secured pre-processing raw materials, the company expects to respond more flexibly to fluctuations in demand for lithium carbonate and lithium hydroxide driven by market conditions in the electric vehicle (EV) and energy storage system (ESS) sectors.
The secured raw materials will be linked with production bases in North America. In North America, ESS demand is growing rapidly due to the expansion of artificial intelligence (AI) data centers and the spread of renewable energy. LG Energy Solution has established five major North American ESS production hubs: three standalone plants—the Lansing plant in Michigan, the Holland plant in Michigan, and the NextStar Energy Ontario plant in Canada—and two joint venture plants—the L-H Battery Company Ohio plant with Honda and the Ultium Cells Tennessee plant with General Motors (GM). The company plans to expand its North American LFP battery production capacity for ESS to over 50 GWh (gigawatt-hours) by the end of this year.
Additionally, through its North American ESS system integration (SI) subsidiary Vertex, LG Energy Solution provides ESS solutions that cover not only cell supply but also system integration.
In particular, NextStar Energy in Windsor, Canada, is Canada's first large-scale battery plant, which began mass production of ESS batteries under the brand name Yangsan in November last year. LG Energy Solution plans to enhance the completeness of its intra-North American supply chain by linking Canadian raw materials with production bases in Canada and the United States.
Lee Kang-yeol, Senior Executive Vice President and Head of the Procurement Center at LG Energy Solution, stated, "Based on a stable supply of lithium concentrate, we will enhance the stability and flexibility of our supply chain and respond more swiftly to customer demand."
in INDUSTRY
