WA will be able to produce precursor chemicals for battery cathodes but won’t be able to drive the production process much further, a new report into the lithium battery supply chain claims.
The report, released in Perth on Friday by the Chamber of Commerce and Industry WA and Australian Venture Consultants, hosed down suggestions WA could become a hub of battery manufacturing.
The report said WA mines most of the metals needed for the nickel-manganese-cobalt lithium-ion batteries emerging as the dominant design for electric vehicles.
However, because countries like China, Japan and South Korea have been making lithium-ion batteries for two decades at a lower cost than Australia it was unfeasible it could break into the global market.
The speakers at the report’s launch echoed those sentiments and said the state should aim to develop the precursor chemicals for battery cathodes, which would still extract a lot of value from the lithium-rich rocks miners pull out of WA dirt and bring plenty of high-paying white-collar jobs.
Squeezing money from rocks
Neometals managing director Chris Reed said by processing the lithium and other battery metals they extracted they doubled the economics of their operations and jobs created.
But producing cathode materials was the limit and would be for the next 10 years.
Neometals has a 13.8 per cent stake in the Mt Marion Lithium mine 40km south-west of Kalgoorlie and plans to build a small lithium hydroxide plant near it.
“I believe most of the value is captured if you indeed alloy lithium, nickel, cobalt, manganese or aluminium into a cathode material. I think that will probably be job done for us,” Mr Reed said.
“I think if we’re downstream processing upstream concentrates we’ll probably double the number of jobs hanging off the mine.”
BHP Nickel West already has a nickel refinery in Kwinana, south of Perth, but asset president Eduard Haegel also signalled his company’s intention to be involved in the supply chain by making nickel sulfate and cobalt sulfate, which are integral to modern lithium-ion batteries.
But he said Australia needed a “champion” battery company to invest in a facility that created precursor cathode materials
“It’s clearly not going to be an Australian company because we have no Australian champions in this space,” he said.
“Its an expensive environment but so too is Sweden and Northvolt is setting up a competitor to Tesla batteries there.
“If we don’t have our own national champion in this space then clearly we need to inspire a Panasonic or a Samsung. I don’t know if its possible but I certainly think it’s a worthy thing to explore.”
Lots of jobs but no one to fill them
Training was again brought to the fore as an issue facing the lithium sector.
Mr Reed said Neometals had gone to the WA School of Mines to offer scholarships to metallurgists, but came up empty-handed.
“We need to catch (the students) at the back end in a couple of years,” he said.
“I said: ‘can you get me a panel of possibly four candidates?’ They said three.
“I said: ‘well we’re offering four scholarships could you possibly get four?’ They said no there’s only three students.
“That will be a challenge.”
Treasurer Ben Wyatt said globally the mining industry was facing a skills shortage.
“Perhaps we need to have a better understanding of the demands of students coming through and perhaps include in those courses and some other angles that might attract more students going in them,” he said.
Lithium could potentially overtake gold as the second highest-paying royalty revenue to the WA government behind iron ore.
Mr Wyatt said the government was “not looking at any change to the royalty structure at the moment.”
