European Lithium & Obeikan to build plant in Saudi Arabia
Another lithium processing plant is being built in Saudi Arabia. This is being built as part of a joint venture between the Australian mining company European Lithium and the Saudi industrial group Obeikan Group.
The plant, which was announced by European Lithium in an ad hoc release, will use lithium mined in Austria under an existing supply contract with BMW to supply 9,000 tonnes of processed lithium hydroxide annually to the German carmaker from 2027, according to information obtained by the Financial Times. While the report does not explain the logistics of transporting the material from Europe to Saudi Arabia, before returning it to a European OEM, the report cites the Chinese dominance in the industry: “China accounts for nearly 60 per cent of global processing for lithium, a critical ingredient in electric car batteries — and the EU and US are bolstering incentives to create more capacity.”
This is further underlined by Tony Sage, executive chair of European Lithium: “A lot of the world is fearful about what would happen if China switched off its [lithium] exports. It would be a disaster for the energy transition.”
European Lithium and Obeikan will each maintain a 50 per cent stake in the plant, which is expected to cost between $350 million and $400 million. Production of the first refined lithium hydroxide is expected to begin in 2026. It will be the second lithium processing plant in Saudi Arabia, alongside that of Australian battery materials company EV Metals Group.
Saudi Arabia recently pledged to invest further capital through its sovereign wealth fund in US carmaker Lucid Motors, which is to build an electric vehicle plant there had won a major contract from the Saudi Arabian government to supply up to 100,000 electric cars over a ten-year period.
In autumn 2022, Saudi Arabia also unveiled its first electric car brand, Ceer, in autumn 2022, which is also planning to build an EV factory there.
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