Invest2 publishersIndependently confirmed2 min readPublished
Posco paid about $41,500 per tonne of yearly capacity for its second Argentine brine plant
Posco Holdings spent $954 million on the upstream stage of its second Argentine brine plant, lifting capacity there to about 48,000 tonnes a year. Half of the 50,000-tonne hydroxide chain it advertises will come from a Korean refinery that is still being built.
The Investor · Invest desk
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What happened
- Posco bought mining rights to the Salar del Hombre Muerto, a salt flat on the border of Salta and Catamarca provinces, in 2018.
- Seoul Economic Daily says a 50,000-tonne hydroxide chain holds enough lithium for about 1.25 million electric vehicles.
- Posco plans third and fourth plants of 25,000 tonnes each, aiming for 100,000 tonnes a year of brine lithium capacity by 2033.
- The Salta and Catamarca provincial governments signed a memorandum with Posco pledging cooperation on permits for those two plants.
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Why it matters
- cost At the second plant's upstream rate, the third and fourth plants would cost about $2.1 billion before any refining, and the provincial memorandum commits Posco to none of that spending.
- constraint Growth past 50,000 tonnes is sized in carbonate and, by Seoul Economic Daily's account, aimed at storage batteries, so the 2033 target is a brine-output goal separate from the hydroxide chain.
- capability Refining the second plant's carbonate in Gwangyang puts the hydroxide step inside Korea under Posco's own operation.
Spread across 23,000 tonnes a year of lithium carbonate [3], the $954 million Posco put into the upstream stage [2] comes to about $41,500 per tonne of annual capacity [17]. That money pays for the step that pulls carbonate out of brine at the salt lake [8], about 4,000 metres above sea level [12].
The announcement's tonnages mix two chemicals. The 48,000 tonnes now installed in Argentina adds the new plant's carbonate to the 25,000 tonnes of a first plant that has run since 2024 [4][5]. The 50,000-tonne hydroxide system [7] counts that first plant plus 25,000 tonnes from a converter at the Yulchon Industrial Complex in Gwangyang, scheduled for next year [6][18]. Going by the reported figures, each tonne of carbonate shipped to Yulchon becomes about 1.09 tonnes of hydroxide [19].
Both reports frame the result as ownership. Korea Herald calls it "an independently operated brine-based lithium hydroxide production system" [7]. Seoul Economic Daily's electric-vehicle count works out to 40 kilograms of hydroxide a car [21]. The reports do not mention China, give a cost for Yulchon or quote a lithium price.
If Yulchon opens on time and the second plant reaches full operation as quickly as Posco plans, according to Korea Herald [14], the 50,000 tonnes exists next year. Adding the two planned plants to today's 48,000 tonnes gives 98,000 [20], a little short of the 2033 goal [9].
I think the second plant is best judged for now as feedstock for Posco's own chain. Posco Group chair Chang In-hwa said, "We will continue to secure competitive resources in advance, turn them into production and earnings and ensure a stable supply of critical minerals needed by South Korean industries" [13]. The plant delivers the production and the supply once Yulchon runs. Earnings depend on what lithium sells for. The counter-case is that about $41,500 per tonne of capacity [17] is a cheap way into a brine field Posco controls, whatever the price does next year. The view fails if Yulchon misses its schedule, because the second plant's carbonate is committed to that converter [6].
What to watch
- A capital budget or final investment decision for the third and fourth plants, set against the roughly $41,500-a-tonne cost of the second plant's upstream stage.
- Named buyers or offtake contracts for the hydroxide the Yulchon converter is due to produce.
- Permits granted by Salta and Catamarca under the new memorandum.