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South Korea's Posco was in Chile this week to unveil a new chemical lithium extraction technology that reduces recovery time from around 12 months to just eight hours at a pilot plant at its JV Maricunga project in the north of the country.
The technology, which was developed by Posco's own research unit, also increases the lithium recovery rate from a maximum of 50% using traditional evaporation ponds to more than 80%.
Posco's first contact with Latin America's lithium industry was three years ago when it signed a cooperation agreement with the Bolivian government, which is still ongoing. The company then formed a JV with Li3 Energy in Chile for Maricunga and is also in talks with industry players in Argentina.
BNamericas met with Posco's president and CTO Ohjoon Kwon to find out more about the technology and the company's plans to develop lithium in Latin America to meet the future demand it is anticipating for lithium batteries.
BNamericas: The new technology developed by Posco seems quite revolutionary in terms of recovery times and rates. Are there other aspects of the process that make it more efficient?
Kwon: Our technology is better in every respect. Our process eliminates the use of evaporation ponds, thus becoming more efficient, ecofriendly and non-dependent on climatic conditions. It should be a suitable alternative for any new brine project going forward.
BNamericas: In terms of project economics, what would you say is the key aspect of the technology?
Kwon: The key part of the lithium development process is how early on you can make a lithium compound. Our engineers created new chemical conditions and you can extract a lithium compound at a much earlier stage. Using our process, there are maybe five steps to make a lithium compound, compared to around 10 steps [using traditional methods].
Since the process is purely chemical, the recovery is also much higher as everything is inside a container.
BNamericas: Staying with project economics, how much of the capital investment would need to be allocated to building a plant using the new technology?
Kwon: Around 70% of capital investment would be needed for the plant.
BNamericas: You are presenting the technology to several players in the region. What is the final objective?
Kwon: To find the right salar [salt lake] to produce lithium at the lowest cost. There are so many different salars and the chemical composition of brine water is different at each of them.
BNamericas: You unveiled the new technology in Chile at the Maricunga project where you have a JV with Li3 Energy. Given the fact that lithium development by private companies is restricted by local legislation, is Posco optimistic about eventually being able to develop that project?
Kwon: It's not easy to change government policy as a private company. We would like to find a way to agree with the Chilean government and authorities.
BNamericas: Li3 has mentioned it is considering developing Maricunga as a postassium-only project. Is the new technology suitable for that?
Kwon: Our technology was not designed for the production of potassium but it can do that too.
BNamericas: How does Posco plan to use the lithium carbonate?
Kwon: We will use high technology to make cathode materials out of the lithium carbonate to be used in the manufacture of secondary batteries.
BNamericas: Is that where you see the main demand for lithium coming from?
Kwon: Yes, and the two biggest markets for lithium batteries are electric vehicles and energy storage for smart grids. Secondary batteries are a big user of lithium and Korea is now the biggest producer of secondary batteries in the world, having overtaken Japan this year.
BNamericas: Do you think the recent problems with the lithium batteries on Boeing's Dreamliner fleet will have a negative impact on the industry?
Kwon: If lithium batteries are used in the wrong conditions, there is some chance of an explosion, but if they are used in the right conditions, this does not occur. What happened will influence the industry to some degree, especially the public, but not if you're a professional working in the area.
BNamericas: How do see lithium demand playing out in the next few years?
Kwon: The predictions for lithium demand in the past have been too optimistic due to economic conditions and the application [of lithium batteries] in electric vehicles and power grids has been slower than expected.
However, the market will expand in the future anyway and this will not be 2% or 3%... it will be a 10-20% expansion. It takes time but you need to be prepared.