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‘The demand is off the scale’ says man behind plans to bring lithium hydroxide production to Teesside

The businessman behind plans to convey the UK’s first lithium hydroxide plant to Teesside Freeport says plans proceed apace as demand for the chemical substances is “off the scale”.

Paul Atherley owns 50% of Alkemy Capital Investments plc and is non-executive chairman of the funding car behind Tees Valley Lithium – the corporate that goals to convey a £216m manufacturing facility to Teesside Freeport that can produce the very important chemical substances utilized by electrical car battery makers.

He says the touted capability of forthcoming electrical car battery gigafactories – together with Britishvolt in Northumberland and Envision AESC in South Tyneside – is round 700GW, dwarfing the 75GW of put in electrical energy capability at present within the UK. However there are at present no producers of the important thing element, lithium hydroxide, in Europe.

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And for the time being, China controls about 90% of the world’s lithium hydroxide provide and it’ll want a lot of this to fulfill its personal plans for carbon neutrality by 2060.

Opponents have additionally signalled plans for comparable crops in Germany and Portugal however Mr Atherley says Tees Valley Lithium is transferring shortly, and advantages from Wilton Worldwide’s “plug and play” chemical substances infrastructure and proximity to clients.

Earlier this 12 months the agency paid £50,000 for exclusivity rights to a 20-acre plot at Wilton Worldwide, owned by Sembcorp, and now it’s constructing a administration staff with hopes the plant might be operational in late 2023, earlier than ramping up capability to 2030 by which level it could possibly be producing 15% of the lithium hydroxide wanted by European electrical car makers.

In a latest presentation with Alkemy’s brokers VSA Capital, he mentioned: “Companies that spend two years doing feasibility studies – all they’re doing really is improving the risk factor, the variability from something like 25% to 15% and that’s really to satisfy the bankers. If you’ve already decided your process routes and you’re already within a chemicals park, you don’t need to spend two years and $5m-$10m on a feasibility study because you’ve got known equipment suppliers into a known infrastructure.

“We’ll go from class 4 straight into feed – in truth, we’re already speaking to EPCM (engineering, procurement and development administration) contractors, so we do not have that large lengthy delay that you’d usually have.”

Mr Atherley is also chairman of Pensana Rare Earths plc, a metals supplier to the electric vehicle and wind turbine market. Pensana was part of the successful bid to bring a freeport to Humber – where it is creating a rare earth processing hub at Saltend Chemicals Park. Tees Valley Lithium’s aim – much like Pensana – is to provide an attractive alternative to global mining companies who may otherwise sell their products to China. Its facility is the start of the supply chain of vital elements used in offshore wind turbines and electric vehicles.

The raw material for lithium hydroxide is lithium spodumene, which only contains about 6% lithium. Currently, mining firms ship large quantities of spodumene to processing plants in China but Tees Valley Lithium’s model will take primary lithium sulphate of between 30-50% lithium which streamlines the process.

Electric vehicle batteries require extremely pure lithium hydroxide which means exacting standards of chemical processing are required. Mr Atherley described the process as “extra lab coats and computer systems than hi-vis and laborious hats”. At the moment Tees Valley Lithium has yet to sign any contracts for supply of the raw material but is looking to to sign up mining companies in the coming months.

Tees Valley Lithium could be supplied by miners as far afield as Australia, but there is also growing potential for sources closes to home including the discovery of “globally vital” lithium deposits in Cornwall.

Mr Atherley mentioned: “Right here we try to decarbonise the transport business however we’re transport 94% waste all over the world on the transport business – which already accounts for about 3% of the world’s carbon emissions. It does not make a lot sense.”

He added: “Cornwall, and different corporations within the UK – we expect the place their product will go to might be Tees Valley Lithium, relatively than transport all of it the way in which to China.”

Tees Valley Lithium plans staged production across four ‘trains’ – the first involving a process known as Glauber’s Salt Route – commonly used in China and Australia. It involves the raw material – lithium sulphate monohydrate (LSM) – being dissolved in water before impurities are removed in two stages.

The purified solution is then pumped to a lithium hydroxide reactor where caustic is added to create a chemical reaction. Some of the production trains will also use processes driven by wind power from the North Sea.

Mr Atherley hailed plans to connect Teesside to the Dogger Bank windfarm, with high voltage cables being laid and onshore converter stations being built just adjacent to the Wilton International site that Tees Valley Lithium could occupy. The move will give firms like them direct access to cheap power which can be temporarily stored in batteries onsite.

“The thrilling factor is that if we are able to get a low carbon footprint into the lithium hydroxide, that is precisely what the cathode lively materials makers need as a result of finally, once you purchase vehicles in Europe, they’ll have an embedded carbon signature in them,” he said.

“That is going to be the behavioural economics which might be going to drive carbon out of the system. The European Union has already made that clear with the carbon border adjustment mechanism.

“So, if we can sell a product that is low carbon and it’s on the doorstep of the cathode active material makers we are looking at potential premiums.”

A planning software for the Wilton Worldwide web site is because of be submitted this month, with approval anticipated by Tees Valley Lithium this summer season. The agency will profit from 5 years of enterprise charges aid and reductions on land tax and stamp responsibility because of the location’s Enterprise Zone standing.

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