Lithium Australia Ltd (ASX:LIT, OTC:LMMFF)'s wholly-owned subsidiary Envirostream Australia Pty Ltd has executed an agreement with LG Energy Solution (LGES) to process a minimum of 250 tonnes of lithium-ion batteries (LIBs), which equates to more than 5,000 energy storage systems.
LGES is one of the world's largest LIB manufacturers with a market-leading position in advanced batteries for grid-scale, home battery and automotive applications.
Recycling core battery components
The agreement signals the company’s commitment to recycling LIBs and cements its partnership with Envirostream as its Australian recycling partner.
Envirostream recycles more than 90% of a lithium-ion battery into its core components which include steel, copper, aluminium and, most significantly, the critical battery metals which are amalgamated into a mixed metal dust.
The active metals in the recovered mixed metal dust can be repurposed into new lithium-ion batteries’ anode and cathode powders.
Under the terms of the agreement, LGES will deliver the LIBs to Envirostream’s facilities in Melbourne for processing.
Partnership evolves
Envirostream and LGES first came together in 2018 and since then Envirostream has recycled more than 85 tonnes of the company’s batteries under previous agreements.
Striking this agreement enables Envirostream to receive additional battery volumes and commence the safe recycling of these batteries with immediate effect.
Envirostream is seeking to obtain similar recycling agreements with other cell and battery manufacturers and will keep the market informed as matters progress.
Increased volumes
The company expects a significant increase in processing volumes for this year relative to last as a result of this agreement.
Battery collection volumes at Envirostream during the last financial year stood at around 1,086 tonnes.
Since the end of the 2022 financial year, Envirostream has observed continued increases in collection volumes.
Roughly 100 tonnes of batteries were collected in July 2022, higher than that achieved in June 2022 (94 tonnes) and May 2022 (90 tonnes).
A monthly collection rate of 100 tonnes extrapolates to an annualised rate of 1,200 tonnes.
The agreed volumes are in addition to LGES’ current collection volumes and represent nearly 25% of Envirostream’s total collections during the 2022 financial year.
In addition to volumes delivered to Envirostream under the agreement, the recently announced agreement with Battery World is expected to increase volumes further.
Ethical and sustainable
Envirostream general manager Andrew Mackenzie said: “Envirostream is leading the battery recycling industry in Australia. LGES share our aspirations of an ethical and sustainable future for the global battery industry.
“Making these batteries available to Envirostream for recycling demonstrates LGES’s commitment to our shared vision.
“Envirostream has been recycling LGES batteries since 2018 and it is very pleasing to see LGES commit to Envirostream as its Australian battery recycling partner for these new volumes.
“We would like to thank LGES and look forward to our continued collaboration.”
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