Last week, the world’s biggest lithium mine was given environmental approval to build a massive processing plant near Bunbury.
The Albemarle Corporation [NYSE:ALB] calls for 500 workers to build its $1 billion lithium plant in Kemerton Industrial Area. On top of this, a further 500 jobs will open once production starts, as Albemarle anticipates each year 100,000 tonnes of lithium hydroxide will be produced from its five processing trains.
Gaining approval over the last environmental hurdle helped the state government take advantage of WA’s position as having half the world’s lithium, which had already founded a lithium and energy materials industry taskforce.
‘The Albemarle lithium plant is another step closer to setting up its operations, which will generate hundreds of local jobs,’ Premier Mark McGowan said.
Lithium plant approvals comes with conditions
Mining lobby group AMEC forecast that global trade in lithium batteries will boost prices to $2 trillion in the next eight years, which is quite a lot higher than its current $165 billion.
Lithium hydroxide is a key component in the making of lithium-ion batteries, which are used to power electric cars.
But all this excitement didn’t come without some restrictions, as WA environmental Minister Stephen Dawson highlighted that the environmental protection authority applied some conditions to its approval.
Albemarle is also waiting on a few more federal approvals before it can take investment action, which appears to be more of a formality for the top priority plant.
Albemarle’s joint partner, China’s Tianqi lithium at Greenbushes, is building a $700 million processing plant at Kwinana.
Both companies have spent $320 million in expansion costs to Greenbushes, with a further $600 million in upgrades in order to increase the mines concentrate to 2.3 million annually from 2021.
What a lithium plant means for Australia’s future
Not only will this generate a boost in jobs, it will also call for a boost in Australia’s resource sector, specifically lithium-battery inspired energy solutions.
There are currently three other lithium processing plans in WA under way, this includes Kwinana the joint project between Chile’s SQM/Kidman Resources, Neometal’s Kalgoorlie and Mineral Resource’s Wodgina.
Something to watch as we see Australia moves towards different types of energy sources, and take advantage of its lithium-rich sources in Western Australia.
We will see more movement towards a battery-powered future, with lithium-powered devices and electric cars.
There are a number of ASX-listed lithium stocks to choose from and knowing which ones to pick is a daunting task.
For Money Morning