A new consortium led by South Korean steelmaking firm POSCO Holdings is making an investment that serves as the Asian nation’s largest possible step into the global lithium scene.
The POSCO-led group is banking on lithium startup EnergyX in a bid to find better and more cost-efficient methods for extracting and processing vital raw materials for green battery manufacturing. This is being done through POSCO’s investments into funds initiated by South Korean financial firms Elohim Partners and IMM Investment Global.
Through these funds, POSCO will participate in EnergyX’s upcoming Series B funding round which aims to raise around $50 million in investments towards its experimental lithium extraction technologies.
While none of the companies involved has disclosed how much POSCO is investing in EnergyX, Elohim’s chief executive Jaeho Rhee regards the funding round with great optimism, going so far as to say that he hopes that EnergyX will thrive in the nascent sector and achieve commercial production levels at a time when the lithium scene has become almost cutthroat in terms of competition.
However, some market watchers feel that this is a major gamble on POSCO’s part as the direct lithium extraction (DLE) solutions being touted by EnergyX and similar firms have yet to be proven viable.
According to those advocating for such innovations, the use of DLE methods is seen as a faster and cheaper approach to extraction, compared to the time-consuming evaporation process currently used to draw lithium out of brine deposits.
As of press time, construction of EnergyX’s DLE demonstration plant is already underway in Argentina, specifically near POSCO’s Sal de Oro lithium extraction initiative in Salta Province. Based on the stipulations for the investment, POSCO is set to test EnergyX’s DLE to see if it will work at the site.
On their end, EnergyX executives are optimistic that the investment will pull through. Indeed, company CEO Teague Egan remarked that they already see POSCO as their primary customer in Argentina, provided that the deal blooms into a full-scale production agreement.