LG Energy Solution and Liontown Resources Form Strategic Partnership for Global Lithium Sector

Strategic Insights -

LG Energy Solution and Liontown Resources Limited have entered into a strategic partnership aimed at fortifying their long-term collaboration in the global lithium sector. The partnership includes a convertible note subscription agreement, an extended offttake agreement for the supply of high-quality lithium spodumene from Liontown's Kathleen Valley Project, and a downstream collaboration agreement to explore the feasibility of establishing a lithium refinery. The partnership signifies a mutual commitment to advancing sustainable and stable lithium solutions globally and underscores the companies' shared commitment to innovation and value creation.

Key Takeaways:

  • Liontown extends LG Energy Solution's existing 5-year offtake agreement by an additional 10 years, providing 1,500kt of spodumene concentrate over years 6 to 15.
  • The agreement includes a commitment to make up to 250kt spodumene concentrate available over the first 10 years (2.45Mt in total).
  • LG Energy Solution will invest US$250 million (A$379 million) through Convertible Notes to support the production ramp-up of Liontown's Kathleen Valley Project.
  • Liontown will provide LG Energy Solution with a stable supply of IRA-compliant critical minerals, fulfilling LG's efforts to provide competitive power solutions for electrification.
  • The downstream collaboration agreement will explore the feasibility of establishing a lithium refinery to process spodumene from Kathleen Valley into battery-grade lithium chemicals.
  • Tim Goyder, Liontown Resources' Chairman, emphasized the partnership's significance in Liontown's journey towards becoming a globally significant supplier of battery minerals.
  • David Kim, LG Energy Solution's Chief Executive Officer, noted that the partnership represents another significant step in LG's value chain investment strategy.

Statistics:

  • 1,500kt: The amount of spodumene concentrate provided by Liontown to LG Energy Solution over years 6 to 15.
  • 250kt: The amount of spodumene concentrate that Liontown will make available to LG Energy Solution over the first 10 years.
  • 2.45Mt: The total amount of spodumene concentrate provided by Liontown to LG Energy Solution over the first 10 years.
  • US$250 million: The amount of investment from LG Energy Solution through Convertible Notes to support the production ramp-up of Liontown's Kathleen Valley Project.
  • A$379 million: The value of LG Energy Solution's investment in Convertible Notes in Australian dollars.
  • 4 July 2024: The scheduled date for the formalization of the Strategic Partnership at LG Energy Solution's headquarters in Seoul, Korea.

Sources:

  • "LG Energy Solution and Liontown Resources Limited announce strategic partnership" (Liontown Resources Limited, no date)