Major Lithium Producer Could Shut German Plant Over EU Rule

Authored by Tsvetana Paraskova via OilPrice.com,

Lithium producer Albemarle could be forced to close its plant in Germany if the European Union classifies the key mineral lithium as a hazardous substance that would change the way lithium is processed and stored, the company’s chief financial officer has told Reuters.

The European Commission is currently reviewing and assessing a proposal from the European Chemicals Agency (ECHA) to classify lithium carbonate, lithium chloride, and lithium hydroxide as substances hazardous to human health. An EU committee is meeting early next month to discuss the proposal, while a final decision on the issue is expected toward the end of this year or early next year.

If the EU decides to include the lithium chemicals in the hazardous category, it would deal a blow to its own goals of becoming self-sufficient in batteries this decade and significantly raise the share of electric vehicles on the roads.

The decision would change the way lithium producers and processors work and will add costs to their operations.

In Albemarle’s case, the company “would no longer be able to import our primary feedstock, lithium chloride, putting the entire (Langelsheim) facility in jeopardy of closure,” CEO Scott Tozier told Reuters in an emailed statement.

Albemarle processes lithium products at its Langelsheim factory in Germany, which employs around 550 people.

Albemarle would sustain a financial blow if it had to shut down the German plant.

“With sales of approximately $500 million annually, the economic impact to Albemarle from the potential closure would be significant,” the company’s CEO told Reuters.

The EU is set to meet 69 percent and 89 percent of its growing demand for batteries by 2025 and 2030, respectively, the European Commission said earlier this year. The EU expects to be capable of producing batteries for up to 11 million cars per year, it added.