LG Energy Solution, Huayou Cobalt to build two battery recycling plants in China

LG Energy Solution is building two battery recycling plants in China with Zhejiang Huayou Cobalt.

Executives from LG Energy Solution and Zhejiang Huayou Cobalt pose for a picture after signing a deal to establish two joint battery recycling plants in China on Monday. [LG ENERGY SOLUTION]

LG Energy Solution is building two battery recycling plants in China with Zhejiang Huayou Cobalt.

The duo signed a deal on Monday to build two plants that will recycle batteries by extracting nickel, cobalt and lithium from used and scrap batteries.

The three metals are used to make cathode materials, which in turn are used to make lithium-ion batteries.

They will be the first-ever plants in China jointly held and constructed by a Korean company and a Chinese company. Details about the investment size have not been confirmed.

One plant will be located in Nanjing, Jiangsu Province, which will process used batteries and scrap before extracting metals. Metals will be extracted at the second plant in Quzhou, Zhejiang Province.

Construction will begin by the end of 2023, with operations targeted to start a year later.

The extracted metals will be used as raw materials to make cathodes, which will eventually be used at LG Energy Solution's Nanjing manufacturing factory.

"Managing the battery lifecycle virtuously is crucial in achieving a sustainable and stable battery supply chain," LG Energy Solution said in a statement.

Huayou Cobalt, China’s biggest cobalt producer, has been closely working with Korean companies since establishing a joint venture to manufacture battery precursors with LG Chem in 2019. The two companies also established a joint venture that produces cathode materials in Gumi, North Gyeongsang in May 2023.

BY SARAH CHEA [chea.sarah@joongang.co.kr]