Saudi Arabia-based battery chemicals and technology business EV Metals Arabia has signed an agreement to build two processing trains to produce lithium hydroxide monohydrate (LHM) in the Lithium Chemicals Plant of the Battery Chemicals in Saudi Arabia.

The Front-End Engineering Design Agreement (FEED) was signed alongside Mustang and Saudi Arabia-based engineering company Faisal Jameel Al Hejailan Consulting Engineering Company will focus on non-process, utilities, and port infrastructure.

According to EV Metals Group, the Battery Chemicals Plant will produce "high purity chemicals containing lithium, nickel, cobalt, manganese."

The company stated that these materials would be used in rechargeable lithium-ion batteries for electric vehicles and renewable energy storage.

Abdullah S. Busfar, chairman of EVM, described the agreement as a "strategic first step" in the development of the Battery Chemicals Complex and that the first two trains would bring in an initial investment of US$800 million.

"They [the first two trains] will produce 50,000 tpa of LHM for Original Equipment Manufacturers, principally electric vehicle manufacturers and battery cell manufacturers seeking stable, long term, independent and transparent supply chains as structural deficits emerge in lithium after 2025," Busfar said.

Michael Naylor, managing director of EVM, said that the Battery Chemicals Complex would address a "critical gap" in the supply chains for electric vehicles manufacturers through its lithium and nickel chemicals plants and cathode active materials plant.

Naylor said these plants would be based on the "upstream integration and development of supply chains for long term supplies of lithium, nickel, cobalt" while the Saudi supply chain is being developed.

Saudi Arabia is looking to develop its mining industry and mineral supply chain. As Mining Magazine recently reported, the country needs to improve access to capital for smaller stakeholders and miners.