Elon Musk announced that Tesla would smelt lithium on U.S. soil to produce battery-grade lithium hydroxide. According to a new report from AutoEvolution, Tesla has opened a major construction project at a site in Corpus Christi, Texas.
Most importantly, a sign has been erected next to the dirt road, announcing that Tesla will build the first lithium refinery in the United States at the site. While Musk is known for his flamboyant personal style, he has been uncharacteristically low-key on the matter.
Last year it was announced that construction would begin as early as the fourth quarter of 2022 and that commercial production would not be possible until the fourth quarter of 2024. Tesla previously explained to Texas regulators that it plans to build a battery-grade lithium hydroxide refinery near Corpus Christi to process the ore feedstock into a more production-ready product.
Before that, Musk also tweeted that lithium batteries are the new oil as a way to affirm the value of lithium in the modern economy. In addition, he also urged entrepreneurs to enter the lithium refining business during Tesla’s earnings call last July, saying that the competition about lithium cannot be lost and that it is a business like printing money.
Tesla previously said it plans to invest about $375 million in the lithium refinery, which will employ about 165 full-time employees and another 250 construction jobs for about two years, and that the plant is expected to be operational in the fourth quarter of 2024.
In addition, Tesla mentioned that the new smelter will use an “innovative process” that will require less harmful substances and produce more usable by-products in the conversion of lithium concentrate into battery-grade lithium hydroxide than the “traditional process. The new smelter will use an “innovative process” that requires less harmful substances on the one hand and produces more usable by-products on the other.
As we all know, lithium is the lifeblood of the electric car industry, with reports that an average of 8 kilograms (17.63 pounds) of lithium is needed per vehicle to make batteries, and China happens to be the dominant player in lithium refining, with more than half of the world’s production capacity.
Last spring, Tesla signed two major contracts with Australian lithium miners Core and Liontown Resources to buy lithium pyroxene concentrates produced by the two companies, respectively.
Specifically, Tesla will purchase 100,000 dry metric tons (DMT) of lithium concentrate from Liontown Resources in the first year starting in 2024 and increasing to 150,000 DMT per year in subsequent years, while Core Lithium will supply Tesla with up to 110,000 tons of lithium pyroxene concentrate over four years, with production expected to begin in the fourth quarter of 2022. The first lithium pyroxene concentrate is expected to be produced in the fourth quarter of 2022 and will be available to Tesla in the second half of 2023.