POSCO Holdings is acquiring 30 per cent of Mineral Resources' half-stake in the Wodgina and Mt Marion lithium mines, which MinRes operates as part of a joint venture with Albemarle at Wodgina and China's Jiangxi Ganfeng Lithium at Mt Marion.
In return for its investment, POSCO will receive 30 per cent of the spodumene concentrate produced by each mine.Â
POSCO plans to process that ore into the chemical lithium for supply to Korean and Western markets, where it is needed as a key component for the lithium-ion batteries that power consumer electronics and electric vehicles.
"This first-of-its kind investment by a major Korean company into Australian lithium is a milestone for our industry," Mineral Resources chairman Malcolm Bundey said.
"It signals the growing global demand for Tier 1 hard rock lithium assets and the confidence international partners have in Australia's ability to meet that demand."
The partnership will play an important role in diversifying the global lithium supply chain and strengthen bilateral ties between Australia and Korea in critical minerals, he said.
The global supply chains in critical minerals and rare earths have been in focus in recent years amid trade tension between China and the United States.
Mineral Resources and POSCO, one of the world's biggest steelmakers, already work together on the Onslow iron ore project in WA, one of the biggest iron ore projects ever undertaken there.
POSCO Holdings chief executive In Hwa Chang said POSCO viewed the energy materials business as a core growth driver alongside its steel business, and the investment would give it access to a stable, cost-competitive supply of raw materials capable of sustaining its business for decades to come.
"Through this partnership, we will combine POSCO's downstream expertise with MinRes' mining capability to drive the sustainable growth of the energy minerals industry and contribute to the global transition to eco-friendly mobility," he said.
Mineral Resources said it would use the proceeds to repay external debt, fortify its balance sheet and position the company for its next phase of growth.
MinRes said it would retain the volume entitlement to the remaining 70 per cent of the spodumene concentrate produced by each mine
Mineral Resources shares were up 8.7 per cent to $51.01 just before midday on Wednesday.
