INTERVIEW: Green Lithium to build pilot plant to support plans for commercial UK lithium refinery

Green Lithium will construct a pilot plant as part of its long-term plan to develop a commercial-scale lithium refinery in the northeast of England, the developer's CEO Sean Sargent told S&P Global Commodity Insights in a recent interview.

Sargent said that the pilot plant, to be constructed on the existing 58-acre planning site at PD Ports Teesport complex, will focus on refining and upscaling the hydrometallurgical alkaline leach technology licensed from Metso to produce both lithium carbonate and lithium hydroxide.

"The flexibility is imperative to us," said Sargent, adding that "the pilot plant will start by producing lithium carbonate as a stepping stone" to producing lithium hydroxide.

Sargent pointed out that although Green Lithium will rely initially on its technology partners, the company is also seeking to develop its own in-house technology for producing battery-grade lithium carbonate and hydroxide.

He added that the company has secured the necessary planning permits and has applied for an operational environmental permit which is currently progressing.

Sargent praised the planning authority in Teesside, noting that it had processed the company's application, including all the baseline environmental surveys and public consultation, in about four months.

"They've been keen to support and bring 21st century jobs to the region," he said.

Assuming that the environmental permit is approved, Sargent said Green Lithium plans to break ground on the pilot plant within six months and to start refining operations during 2026.

From there, Sargent said that the commercial lithium refinery -- capable of manufacturing 50,000 metric tons per year of battery-grade lithium carbonate and hydroxide -- would be constructed during the latter part of the decade with a view to starting operations before 2030.

According to Sargent, the refinery will feature two lines capable of processing 25,000 t/y each, with enough space left for the addition of a third line at some point in the future.

Sargent added that Green Lithium is exploring a range of renewable energy options alongside the use of hydrogen gas and carbon capture technology.

Green Lithium has signed a memorandum of understanding with Hynamics, a subsidiary of EDF Group which is developing the Tees Green Hydrogen project. The project plans to utilize electricity supplied by the Teesside offshore wind farm along with a consented new solar farm that EDF Renewables UK intends to construct near Redcar, to produce hydrogen for supplying local industry.

EDF and Hynamics are currently progressing phase one of the project, which envisages an electrolyzer with a 7.5 MW capacity. Construction is expected to begin in 2025 with the facility due to be operational by 2026.

"Using hydrogen to power our lithium refinery was always part of our energy transition as soon as it becomes affordable," Sargent said.

"In the interim, we're likely to utilize natural gas but we're also exploring the potential to start using a mixture of natural gas and hydrogen."

According to Sargent, Green Lithium has received good support from the UK government in recent years. In April 2021, the company was awarded a GBP631,000 grant from the UK Advanced Propulsion Centre's (APC) Automotive Transformation Fund Feasibility Studies (ATF FS2).

Sargent also acknowledged that the UK is yet to introduce an equivalent of the US's Inflation Reduction Act or the EU's Critical Raw Materials Act which provides financial and regulatory support for strategic projects involved in mining and midstream processing

"We get a sense that the UK can't afford to do anything dramatic," he said. "However, the automotive transformation fund has been a real lifeline for us and some of the new proposals with the automotive transformation fund to help demonstration scale plants has been very beneficial for us."

At the same time, Sargent said that the UK's Critical Minerals Strategy, which aims to increase the resilience of UK critical mineral supply chains and security of supply, has had no significant impact on domestic UK projects. He added that Green Lithium is subsequently exploring the possibility of accessing the benefits provided under the EU CRMA.

Sargent said that the UK government funding mechanism remains highly dependent on the private sector, which can be problematic when it comes to supporting critical minerals projects.

"It does strike me as slightly bizarre that we primarily rely on private money to provide project financing to achieve what is a huge strategic objective for the country," he said.

A spokesperson for the UK Department of Business and Trade recently told S&P Global Commodity Insights that the new government will continue to support and promote automotive innovation in the UK with resources from the National Wealth Fund, a GBP7.3 billion fund aimed at supporting the UK's clean energy industries, strengthening energy independence and mitigating climate change.

The spokesperson added that the UK was also working with its international partners to "develop diverse and responsible sources of critical minerals for UK manufacturers."

The UK already has agreements with South Korea (February 2022), Canada (March 2023), Australia (April 2023), Saudi Arabia (May 2023) and Zambia (August 2023) aimed at strengthening critical raw material supply chains.

Regarding market prices, Sargent said that, while he expects an upward price correction over the next 18 months, he does not anticipate prices returning to the heights seen in recent years.

Platts, part of S&P Global Commodity Insights, assessed battery-grade lithium carbonate and lithium hydroxide at the identical price of $11,000/t CIF Europe on Aug. 21, down 30% and 31% since the beginning of 2024.