KIGAM and SK ecoplant Secure Lithium Exploration Rights in Kazakhstan

The Korea Institute of Geoscience and Mineral Resources (KIGAM) and SK ecoplant Co. have secured the rights to explore four lithium mines in Kazakhstan. These mines are estimated to contain approximately 25,000 tons of lithium, enough to produce batteries for around 3.3 million electric vehicles.

KIGAM announced on Thursday that it signed a multilateral memorandum of understanding (MoU) with SK ecoplant, Kazakhstan’s Ministry of Industry and Construction, and state-owned mineral exploration company Tau-Ken Samruk on Wednesday.

The MoU grants KIGAM and SK ecoplant exclusive rights to explore the subsoil of four lithium mines in the Bakenoye region of Kazakhstan. “The Kazakh government is formally cooperating with KIGAM, which has the technology for mineral resources exploration, development, and usage,” KIGAM stated.

Kazakhstan, the world’s largest uranium producer, is rich in various mineral resources, including lithium, a crucial material for batteries. Although Korea is a leading battery manufacturer, it imports all its lithium, with 95% of its supply coming from China in 2022, posing significant supply risks.

Kazakhstan proposed cooperation for lithium development to KIGAM in 2022. Since then, KIGAM and Kazakhstan have continued their exploration efforts, identifying a promising area in June 2023 with substantial lithium deposits in the eastern Bakenoye region covering 1.63 square kilometers.

Under the MoU, KIGAM will explore the subsoil of four mines in the Bakenoye region, conducting drilling to assess the accuracy of existing reserves, economic viability, and lithium quality. If the economic viability is confirmed, KIGAM will proceed with feasibility studies and the construction of production plants. However, production rights for lithium will require separate contracts.

“If the economic viability is confirmed, we will initiate negotiations for the development rights during the development process,” KIGAM stated. The data obtained from exploration will be valuable even without securing production rights.

Following the MoU, KIGAM will conduct further investigations on the four mines in the second half of 2024, including geological surveys and 3D modeling to determine lithium content and surface content changes. Drilling explorations to confirm resource quantities are expected in the first half of 2025.

Meanwhile, Korea’s heavy industry company Doosan Enerbility Co. has signed cooperation agreements and MoUs with Kazakhstan’s state-owned financial and energy enterprises to expand its local business. Park Jeong-won, Doosan Group’s chairman and CEO, discussed energy business cooperation with President Kassym-Jomart Tokayev during a state visit to Kazakhstan.

Doosan Enerbility announced on Thursday that it signed a cooperation agreement with Samruk Kazyna at the presidential palace in Astana, Kazakhstan. Samruk Kazyna, Kazakhstan’s sovereign wealth fund, owns several enterprises including Samruk Energy, which is responsible for power production and supply. The agreement covers cooperation in Kazakhstan’s power industry, talent development, and technology exchange programs.

Doosan Enerbility also signed an MoU with Samruk Energy and Korea Electric Power Corp. KPS (KEPCO KPS) to supply environmental facilities to two outdated thermal power plants and three new ones. Kazakhstan’s fossil fuel-based power facilities, which account for about 80% of its capacity, are over 30 years old and in need of refurbishment and modernization. The Kazakh government aims for carbon neutrality by 2060 and is diversifying its energy mix while expanding the use of renewable energy.