Korea wins rights to explore lithium mines in Kazakhstan

[Courtesy of Korea Institute of Geoscience and Mineral Resources]

The Korea Institute of Geoscience and Mineral Resources (KIGAM) and SK ecoplant Co. won the rights to explore four lithium (Li) mines in Kazakhstan. It is estimated that these mines contain about 25,000 tons of lithium, which is enough to produce batteries for about 3.3 million electric vehicles.

KIGAM announced on Thursday that it signed a multilateral memorandum of understanding with SK ecoplant, Kazakhstan’s Ministry of Industry and Construction, and state-owned mineral exploration company Tau-Ken Samruk on Wednesday.

The MoU grants KIGAM and SK ecoplant exclusive rights to explore the subsoil of four lithium mines in the Bakenoye region of Kazakhstan.

“The Kazakh government is formally cooperating with KIGAM, which has the technology for mineral resources exploration, development, and usage,” the institute said.

Kazakhstan is the world’s largest uranium producer and is rich in mineral resources. It produces most of the elements on the periodic table, including lithium, a key material for batteries.

Even though it is a leading battery manufacturer, Korea imports all of its lithium. It imported 95 percent of its supply in 2022, mostly from China, which poses a significant supply risk.

Kazakhstan proposed cooperating for lithium development to KIGAM in 2022. KIGAM and Kazakhstan have continued their exploration efforts since then, identifying a promising area in June 2023 with substantial lithium deposits in the eastern Bakenoye region that covers 1.63 square kilometers.

KIGAM negotiated with Kazakhstan to obtain exploration rights for this area and will explore the subsoil of four mines in the Bakenoye region and will drill to assess the accuracy of existing reserves, economic viability, and lithium quality under the MoU. If the exploration’s economic viability is confirmed, KIGAM will proceed with feasibility studies and the construction of production plants.

The exploration rights, however, do not grant production rights for lithium yet as securing the Kazakh lithium requires separate contracts.

“If the economic viability is confirmed, we will initiate negotiations for the development rights during the development process,” KIGAM said. It noted that the data obtained from exploration will be valuable even without securing the production rights.

Following the MoU, KIGAM will conduct further investigations on the four mines in the second half of 2024, including geological surveys and 3D modeling, to determine lithium content and surface content changes. Drilling explorations to confirm resource quantities are expected in the first half of 2025.

For its part, Korea’s heavy industry company Doosan Enerbility Co. signed cooperation agreements and MoUs with Kazakhstan’s state-owned financial and energy enterprises to expand its local business.

Park Jeong-won, Doosan Group’s chairman and CEO who accompanied President Yoon Suk Yeol on a state visit to Kazakhstan, discussed energy business cooperation with President Kassym-Jomart Tokayev.

Doosan Enerbility announced on Thursday that it signed a cooperation agreement with Samruk Kazyna at the presidential palace in Astana, Kazakhstan.

Samruk Kazyna, Kazakhstan’s sovereign wealth fund, owns several enterprises including Samruk Energy, which is responsible for power production and supply.

The agreement encompasses cooperation in Kazakhstan’s power industry as well as initiatives for talent development and technology exchange programs.

Doosan Enerbility also signed an MoU with Samruk Energy and Korea Electric Power Corp. KPS (KEPCO KPS) to supply environmental facilities to two outdated thermal power plants and three new ones.

Kazakhstan’s fossil fuel-based power facilities account for about 80 percent of its capacity, with more than half being over 30 years old, necessitating refurbishment and modernization. The Kazakh government aims for carbon neutrality by 2060 and is diversifying its energy mix as well as expanding the use of renewable energy.