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- Pilbara Minerals (PLS) finalises key conditions to progress its planned conversion facility in South Korea, a condition in the formation of a joint venture (JV) with POSCO
- With the incorporated JV now finalised, the scheduled completion of equity subscriptions is set for mid-April 2022
- The JV will now proceed with the construction and 18-month ramp-up of the planned lithium hydroxide chemical plant in Gwanyang, South Korea
- Construction of the first train of the conversion facility is expected to be completed by mid-2023, with the second train to be completed approximately three months later
- PLS shares are up 0.31 per cent and trading at $3.21 per share
Pilbara Minerals (PLS) has satisfied a construction and ramp-up budget condition and other key conditions to progress its planned conversion facility in South Korea as part of a joint venture (JV) with POSCO.
Last year, the company formed the JV to develop and operate a lithium hydroxide monohydrate (LHM) conversion facility.
The South Korean facility will produce 43,000 tonnes of LHM per year and PLS will supply 315,000tpa of chemical-grade spodumene concentrate from Pilbara Minerals’ Pilgangoora project.
With the incorporated JV now finalised, the scheduled completion of equity subscriptions is set for mid-April 2022.
The JV will now proceed with the construction and 18-month ramp-up of the conversion facility in Gwanyang, South Korea which will be their flagship lithium hydroxide chemical plant.
“With commissioning expected late 2023, this joint venture places both Pilbara Minerals and POSCO in a very strong position to participate as one of the few near-term lithium fine chemicals producers with underwritten raw materials supply that will emerge in the coming two years,” said Managing Director and CEO Ken Brinsden.
In accordance with regulatory requirements in South Korea, Pilbara Minerals has now filed its foreign investment report with the Korea Trade Investment Promotion Agency (KOTRA) and received the necessary approval for its initial 18 per cent investment in the JV, the last remaining material condition before equity subscription completion.
Pilbara Minerals will be able to increase its interest to 30 per cent with a call option when funds are drawn down from the convertible bond being provided by POSCO at completion.
This call option will be available for up to 18 months after the successful ramp-up of the
conversion facility to 90 per cent of nameplate capacity, exercisable at cost plus 3.58 per cent interest per annum up until the facility receives independent battery certification from tier 1 battery producers.
The project development timeline for the conversion facility will see major construction works likely to commence from the June 2022 quarter, with detailed engineering and early works already underway.
Construction of the first train of the conversion facility is expected to be completed by mid-2023, with the second train to be completed approximately three months later.
PLS shares were up 0.31 per cent and trading at $3.21 as of 11:38 am AEST.
