[Edaily Reporter SOYEON KIM ] LG Energy Solution is strengthening its local critical mineral supply chain in North America by signing a long-term lithium carbonate supply agreement with a U.S.-based lithium development company. Through this agreement, the company has established a fully integrated supply chain system in the U.S., spanning from raw material procurement to battery production.

LG Energy Solution announced on the 1st that it had signed a long-term lithium carbonate supply agreement with U.S.-based Smackover Lithium. SMEC CO.,LTD is a joint venture established by Standard Lithium, a U.S.-based lithium development company, and Equinor, a Norwegian state-owned energy company. The contract is reportedly valued at approximately $1.5 billion (about 2.0534 trillion won).

Through this agreement, LG Energy Solution is set to receive a total of 80,000 metric tons of lithium carbonate over a 10-year period starting in 2029, when SMEC CO.,LTD begins full-scale production. This volume is sufficient to produce approximately 1.8 million high-performance electric vehicles capable of traveling more than 500 km on a single charge.

SMEC CO.,LTD plans to produce high-quality lithium carbonate using an eco-friendly method that minimizes carbon emissions by applying Direct Lithium Extraction (DLE) technology to the “Southwest Arkansas Project” currently underway in Arkansas, U.S.

With the energy storage system (ESS) market growing rapidly due to rising electricity demand in North America, securing local supply chains for key battery cathode materials—such as lithium iron phosphate (LFP)—has emerged as a critical challenge. Accordingly, LG Energy Solution pursued a long-term supply agreement to proactively address the surging demand for lithium carbonate.

In particular, lithium carbonate is primarily used as a key raw material for LFP and ternary batteries. Along with lithium hydroxide, which is mainly used in high-performance ternary (high-nickel) batteries, it is considered a key mineral driving the electric vehicle and energy transition markets.

By securing a stable local supply chain in the U.S. through eco-friendly production methods based on DLE technology, LG Energy Solution is expected to meet the eligibility requirements of the Inflation Reduction Act (IRA) and simultaneously strengthen its supply chain competitiveness and ESG (Environmental, Social, and Governance) competitiveness in the North American market.

LG Energy Solution currently operates eight production facilities across North America. Through this agreement, the company has established a comprehensive supply chain system spanning from the local procurement of raw materials to battery production.

David Park, CEO of Standard Lithium, stated, “It is very meaningful to sign this agreement with LG Energy Solution, a world-class battery manufacturer,” adding, “We expect to build a solid partnership where both companies grow together by supplying U.S.-sourced lithium carbonate to LG Energy Solution on a long-term and sustainable basis.”

Lee Kang-yeol, Executive Vice President and Head of the Procurement Center at LG Energy Solution, said, “This partnership with Smackover Lithium is a meaningful achievement that enhances supply chain stability by securing key minerals produced in an environmentally friendly manner in the strategic North American market.”

LG Energy Solution has been actively expanding strategic partnerships with leading companies in major mineral-producing countries around the world to build a stable supply chain for raw materials. Previously, the company signed a long-term supply agreement for 100,000 metric tons of lithium hydroxide and carbonate with Chile’s SQM, the world’s largest lithium producer, and has continued to pursue multifaceted raw material collaborations with major lithium companies, including signing a supply agreement for 1.75 million metric tons of lithium concentrate with Australia’s Liontown.