SET-listed and mostly state-owned Bangchak Corporation Plc (BCP) is considering creating a new value-added business from its first lithium carbonate output starting in 2019.
President and chief executive Chaiwat Kovavisarach said the company expects to use about 25,000 tonnes of lithium carbonate a year as feedstock for energy storage.
He said Bangchak has not yet finalised the business project to add value to the lithium production. However, it is closely monitoring the trend of energy storage technology to match rising demand not only in the mobile phone market, but also in electrical vehicles (EVs).
Mr Chaiwat said the plan to diversify into lithium mining was triggered over the past two years, which have seen the price of lithium jump fourfold to almost US$20,000 per tonne, up from around $5,000 a tonne a few years before, which suggested it could be a profitable avenue for the company to explore.
Bangchak yesterday signed an agreement in Bangkok to be a strategic financial partner with the Canada-based Lithium Americas Corporation (LAC).
Bangchak has injected around $133 million of capital expenditure into LAC, including an $80-million loan and $33-million to acquire 16% ownership in LAC, he said.
Aside from the plan to diversify into lithium mining, Bangchak has its renewable energy subsidiary, BCPG Plc, which listed on the Stock Exchange of Thailand last year.
Currently, BCPG produces a total of 400 megawatts of renewable power and is planning to expand to 1,000 MW by 2020 from assorted projects across Asia ranging from solar farms, wind farms and geothermal power plants.
BCPG also plans to create added value to its business by seeking to buy into promising businesses in the same manner as Bangchak acquired LAC.
Tom Hodgson, LAC's chief executive, said the firm has 50% of the ownership of the Cauchari-Olaroz mine in Argentina, along with SQM, which is overseen by joint venture Minera Exar SA. It already has a project financed for opening the mine and production worth $285 million.
Last month, LAC raised capital by selling a 17% stake in the company to China-based Ganfeng Investment.
BCP shares closed yesterday on the SET at 38.25 baht, down 50 satang, in trade worth 214.2 million baht.