Green Lithium, Trafigura sign supply agreement for UK lithium refinery

Lithium processing company Green Lithium has partnered with commodity trading company Trafigura for the supply of lithium feedstock for its centralized commercial lithium refinery in the UK, Green Lithium said May 9.

Green Lithium is planning to build a 50,000 mt/year refinery, which will supply European electric vehicle and battery manufacturers. The refinery is due to produce enough lithium hydroxide to enable manufacture of more than 1 million EVs/year.

By building the refinery, Green Lithium is aiming to provide the missing link in the EV supply chain, using a sustainable and low-carbon refining process to connect the UK and Europe's lithium battery and cell manufacturers with international sources of raw lithium material.

Lithium prices have been firm in recent months, with S&P Global Commodity Insights' seaborne lithium carbonate and lithium hydroxide assessments up 121.9% and 152.4%, respectively, since the start of 2022 at $75,000/mt CIF North Asia and $80,000/mt CIF North Asia as of May 9.

Green Lithium said it was forecast that increasing demand for battery-grade lithium chemicals would not be met by current global refining capacity, meaning more refineries were needed to ensure the commercial viability of the European battery supply chain and energy transition and reduce reliance on China.

The company's planned UK refinery will be one of the first in Europe, with it saying that it expected to "create the missing link and guarantee upstream supply chain security."

It plans to use renewable energy and hydrogen in the refining process where its possible to reduce CO2 emissions, as well as create a circular economy in battery recycling while eliminating process waste through sustainable reuse of by-products.

"The electric revolution is fundamental to reducing the carbon emissions that contribute to global climate change and ensuring net-zero targets can be met," Green Lithium CEO Sean Sargent said.

"In Trafigura, we have found the perfect match in a company that not only has vast experience and expertise in the battery supply chain, but that is also willing to make a key equity investment to support Green Lithium in achieving its project objectives," he added.

"This landmark project has the potential to revolutionize the European supply chain for EV production and sustainable energy storage at this critical time in the energy transition," Trafigura's Global Head of Battery Metals Socrates Economou said.

"We're looking forward to working with Green Lithium to support its development, as we continue to bring Trafigura's global expertise to the fore in transforming the battery metals supply chain for a low-carbon future," he added.

It said that following an initial private funding round, which secured more than five times the target amount, Green Lithium was currently raising capital to fund its development phase activity.

In June 2021, Green Lithium secured GBP1.6 million ($2.2 million) in funding to progress its plans to build and operate the UK refinery.