POSCO Group explores additional lithium resource acquisitions

[Courtesy of POSCO Holdings Inc.]

South Korea’s POSCO Group announced its plans to secure additional lithium resources for secondary batteries in South America, particularly in Argentina and Chile.

Jeong Ki-Seop, Chief Strategy Officer and President at POSCO Holdings Inc., met with Argentina’s Minister of Economy, Luis Caputo, in Buenos Aires last Wednesday to discuss POSCO’s lithium business in Argentina, the company said on Monday. During the meeting, Jeong requested that POSCO’s lithium projects be included in the Argentine government’s incentive program for large-scale investments. The company will benefit from tax reductions on corporate and withholding taxes if the projects are included.

For his part, Caputo pledged support by creating a favorable investment and business environment, including infrastructure and regulatory permission.

POSCO has been constructing production facilities for secondary battery-grade lithium in two phases, each with an annual capacity of 25,000 tons, since it acquired the Hombre Muerto lithium brine field in Argentina in 2018. The first phase is expected to be completed in 2024, with the second phase targeted for completion the year after. These facilities will produce enough lithium to manufacture batteries for 1.2 million electric vehicles.

POSCO is also considering additional investment for a third-phase plant, which would add another 50,000 tons of annual capacity. The company expects that qualifying for the Argentine government’s incentives would enhance its financial stability thanks to the tax benefits for this expansion.

Following his visit to Argentina, Jeong met with senior officials from Chile’s Ministry of Mining in Santiago on June 14th, 2024, to discuss lithium brine field development in the country. Chile has been pursuing lithium resource development under a national strategy announced by President Gabriel Boric in April 2023, which emphasizes public-private partnerships and minimizing environmental damage during development.

Jeong highlighted POSCO’s capabilities as an ideal partner for Chile’s lithium projects, and a senior Chilean official expressed interest in POSCO’s lithium business expertise. The official invited POSCO to actively participate in new lithium brine field projects, including the Maricunga and Altoandinos fields, which are currently open for bidding. The Chilean government is also considering providing support for POSCO’s potential expansion of the secondary battery materials supply chain within the country.