Western Australia: the new Lithium Valley?

Western Australia is no stranger to pioneering new and globally successful industries. Just look at our resources and agriculture sectors, and now our rapidly developing defence and space industries.

Our state has another new and exciting opportunity to become the world’s new Silicon Valley – except with Lithium. WA has always been at its best when the State and Federal Government’s work together with industry, and this opportunity is no exception.

A report prepared for the Association of Mining and Exploration Companies (AMEC) on the lithium industry in 2017 breaks down the five key processes of the value chain for battery production – mining, refining, electro-processing, cell production and assembly.

Whilst it’s no secret we’ve always been world leaders in extracting and exporting our natural resources, we now have an unprecedented opportunity to grow a new industry processing and manufacturing raw lithium into new products and technologies.

Australia represents a whopping 51% of the global value share when it comes to mining lithium, compared to our closest competitors Chile at 29%, Argentina at 14% and China at 5%. Despite this commanding lead, we slip off the measurable index when it comes to the next four stages. Today China is the largest global player in refining, electro-processing and cell production, and Japan the largest in assembly.

It’s time for that to change. We have the lithium, the technology and the people to make it happen.

Recently I had the honour of visiting the Pacific Industrial Company south of Perth, they are tasked with building plant infrastructure for Tianqi Lithium’s record $700 million investment in Kwinana. The $400 million first stage of this massive operation will produce 60% of the global lithium supply – adding the second $300 million plant will increase production to 120% based on the current size of the rapidly growing global lithium market. This facility means Australia will have well and truly entered the second stage – refining.  

To get a sense of the scale and pace of demand in this industry, you just need to look at the decisions of global car manufacturers to increase their production of electric vehicles. Volvo, Nissan, Ford, Volkswagen, Mercedes and others, predict electric vehicle sales will make up double digits of their market share by the early 2020’s. Lithium is also used in many other industries including aircraft components and where there is a weight-sensitive requirement for energy storage.

Pair that with the ambition of an increasing number of European nations to go fossil fuel free over the coming decades, we can start to see just how uniquely positioned WA is in this growing market. As a state, we can dominate the global supply of lithium batteries, new applications and technologies – creating decades of new jobs for Western Australians.  

AMEC’s report acknowledges Australia is well placed to develop as a competitive player through the remainder of the value chain, particularly taking into account the abundance of the raw resource we have available and anticipated demand domestically for finished products.

Like the creation of any new industry, it won’t just happen. The global lithium valley can and should be developed right here in WA. It can be done with Western Australian smarts, using Western Australian resources, to create Western Australian jobs.

I look forward to continuing my work with this exciting new sector – its future is very bright indeed.