Qinghai-based venture will eventually see 30,000 tonnes of battery chemicals produced each year and is just the latest move in the Huizhou firm’s bid to secure interests in the raw materials it uses
Chinese battery maker EVE Energy is buying a stake in a small lithium producer ahead of setting up a joint venture to build a lithium chemicals project costing up to $277.8 million.
The move, announced on Friday, is EVE’s latest tilt to secure ingredients for batteries used in electric vehicles, like lithium. It has already claimed a small stake in cobalt producer Zhejiang Huayou Cobalt and a 17% interest in a $2.1 billion nickel and cobalt project alongside Huayou in Indonesia.
EVE, based in Huizhou in southern China, said in an exchange filing it planned to take a 28.1% equity in Jinkulun Lithium Industry Co, which makes lithium metal in China’s north-western Qinghai province, known for its lithium salt lakes.
The two companies agreed to set up a Qinghai-based venture to build a plant to make 30,000 tonnes per year of battery chemicals lithium carbonate and lithium hydroxide, EVE said.
First-phase output would be 10,000 tonnes, it added, putting the total project construction time at no more than 36 months.
EVE said the venture was “conducive to improving the stability of the company’s supply chains” and could reduce the adverse impact of raw material price fluctuations.
Prices for battery-grade lithium carbonate in China, as assessed by Asian Metal, have fallen about 2% in the past month but are still up more than 65% so far in 2021 as demand roars back after a three-year downturn.
- Reporting by Reuters