POSCO Holdings to secure lithium from oil-field brine in Canada

South Korea's POSCO Holdings Inc. announced on Wednesday it signed a memorandum of understanding (MOU) with Invest Alberta Corporation (IAC) in Seoul, setting the stage for a lithium extraction project.

This venture focuses on oil-field brine, the mineral-rich waters surrounding oil deposits, which are crucial for the production of secondary batteries.

The collaboration signifies POSCO Holdings' entry into the lithium market of Alberta, Canada, where they will conduct exploration and development activities for lithium and other minerals present in oil-field brine.

The company is set to identify promising mining locations, evaluate investment opportunities, and confirm a viable commercial process for lithium extraction.

Under the terms of the MOU, Invest Alberta Corporation will provide POSCO Holdings with administrative support, critical resource development information, tax incentives, and networking opportunities with potential business partners to facilitate the project's success.

Alberta's prominent oil and shale gas sectors have brought its oil-field brine lithium reserves into the spotlight, with experts recognizing them as some of the largest globally.

Despite its lower lithium concentration compared to conventional sources, the North American region's extensive reserves offer a new and promising avenue for lithium sourcing.

Corporations worldwide are exploring methods like direct lithium extraction (DLE) to tap into these reserves found in depleted oil fields. With this MOU, POSCO Holdings aims to expand its raw material supply chain to include not only traditional brine and ore lithium but also clay and oil-field brine.

This move is strategically aligned with the US Inflation Reduction Act (IRA) and is poised to secure POSCO Holdings' pivotal role in the North American lithium market.

Write to Hyung-Kyu Kim at khk@hankyung.com