Energy Storage

18 Mar 2024

Lithium Australia in Exclusive Australian Battery Recycling Agreement With Lg Energy Solution

18 Mar 2024   

Lithium Australia Ltd (ASX:LIT, OTC:LMMFF) subsidiary Envirostream Australia Pty Ltd has signed an exclusive three-year recycling agreement with LG Energy Solution to recycle recalled lithium-ion batteries in Australia.

LG Energy Solution is one of the world’s leading battery manufacturers for electric vehicle (EV) and energy storage systems and is the largest producer of EV batteries outside of China, holding a global market share of ~14% as of 2023.

Envirostream has the exclusive right to provide battery recycling services for LG Energy Solution’s lithium-ion batteries in Australia, which are subject to a recall.

The agreement is for an initial three-year term, ending March 10, 2027. In addition to recycling revenues received under the agreement, Envirostream has an opportunity to generate additional revenue from the sale of mixed metal dust back to LG Energy Solution.

"Extends strong relationship"

Lithium Australia CEO and managing director Simon Linge said: “We are very excited to announce this new agreement signed with LG Energy Solution, a world-leading battery manufacturer for EVs and ESS around the globe.

“The signing of this agreement extends the already strong relationship with LG Energy Solution, who share our vision for sustainable recycling of lithium-ion batteries.

“Our strategic roadmap identified the importance of signing long-term agreements with tier-1 EV and ESS manufacturers. We see agreements of this type as key to moving our recycling operations to being cash flow positive and allowing us to grow our capabilities nationally.

"We are pleased that the first of these agreements is with LG Energy Solution and look forward to announcing further agreements with other tier 1 manufacturers.”

Improved commercial terms

The new agreement replaces the prior recycling agreement between the parties announced in September 2022, with improved commercial terms relative to the prior agreement, reflecting Envirostream’s focus on improving operational outcomes and the standard of service provided to LG Energy Solution.

This agreement is expected to significantly increase Envirostream’s large-format lithium-ion battery collection volumes, leading to greater recycling revenues.

There are now around 6,000 units of LG Energy Solution’s large-format lithium-ion batteries ready for Envirostream to collect and process under the agreement, and a further 5,000 units anticipated.

This represents a total of around 770 tonnes of lithium-ion batteries, or ~140% of Envirostream’s total lithium-ion battery collection volumes in FY2023, and highlights the significant lithium-ion battery collection volume growth the new agreement brings.

Stocks exposed to cryptocurrencies and other digital assets were mixed as Bitcoin retreated after reaching a record-high price of $73,798 on Thursday.

Shares of Bitcoin traded about 7.5% below its new high at about $68,200 shortly before noon on Friday.

After sinking into the red earlier in the session, crypto exchange platform Coinbase Global Inc (NASDAQ:COIN) rallied to trade 1.7% higher at about $238.

Elsewhere, software-turned-cryptocurrency holding company MicroStrategy Incorporated (NASDAQ:MSTR) traded 0.8% lower at $1,663.

The firm on Friday unveiled the pricing of its $525 million debt offering, the proceeds of which it intends to use to acquire additional Bitcoin.

As of February 25, the company holds 192,000 Bitcoin purchased at an average price of $31,544.


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