LG Chem agreed to build an LFP (lithium-phosphate-iron) cathode material plan with China's Huayou Group in Morocco, which has a free trade agreement with the U.S., to mass produce cathode materials from 2026, the Korean company said Sunday.
LG Chem said it signed a comprehensive memorandum of understanding (MOU) with Huayou on Sept. 22 involving the supply chain of cathode materials. Under their agreement, the two sides will work together to build a total of four facilities, including an LFP cathode material plant and a lithium conversion plant in Morocco, as well as a high-pressure acid leaching (HPAL) plant and a precursor factory in Indonesia.
"We will actively respond to the emerging LFP cathode material market with the Morocco plant as our global base," Shin Hak-cheol, CEO of LG Chem, said. "Our goal is to create a strong, vertically integrated material supply chain ? flowing from raw materials to precursors and cathode materials ? and solidify our status as the world's top comprehensive battery materials producer."
The two companies will build an LFP cathode joint venture in Morocco with an annual production capacity of 50,000 tons. LG Chem said the 50,000 tons of LFP cathode materials are enough to make 500,000 entry-level electric vehicles with a driving range of 350 kilometers per single charge.
The Morocco plant will produce LFP cathodes for supply to North America.
"LFP cathode materials produced at the Morocco plant will be supplied to the North American market and subsidized by the U.S. Inflation Reduction Act (IRA) as Morocco is a signatory to the U.S. Free Trade Agreement (FTA)," LG Chem said.
LG Chem added it will venture into the LFP cathode materials business from the Morocco plant and expand the business into lithium-manganese-phosphate-iron (LMFP) cathode materials, a mixture of manganese and LFP that provide more capacity and better output than LFP cathode materials.
The two sides will also promote the lithium conversion plant in Morocco. A conversion plant is a facility that extracts lithium hydroxide and lithium carbonate, both of which are essential for producing cathode materials from lithium concentrates.
The companies are also considering the establishment of a precursor plant in Indonesia with a production capacity of 50,000 tons per year.