News Article

Galaxy Resources enters technology license agreement with Li-ion producer K2 Energy
Date: Jul 30, 2011
Source: Green Car Congress ( click here to go to the source)

Featured firm in this article: K2 Energy Solutions Inc of Henderson, NV

Australia-based Galaxy Resources Limited has signed a technology license agreement with US-based lithium-ion battery producer K2 Energy Solutions Inc. (Earlier post.) Under the agreement, K2 Energy will provide Galaxy with battery technology expertise, licensing and commercial support for the construction and operation of Galaxy’s proposed Jiangsu plant in China.

Galaxy will have the unrestricted and unlimited use of specific K2 Energy lithium battery technologies, valuable for the E-bike and other battery markets. Subject to the Galaxy Board approving the Battery project, K2 Energy’s superior and proven lithium battery technology coupled with Korean state-of-the-art automated plant equipment, will help Galaxy to leapfrog research and development and produce world-class lithium ion batteries.

—Galaxy Resources Managing Director, Iggy Tan

K2 Energy has developed a family of large format batteries and battery systems based upon lithium iron phosphate technology. K2 Energy also has experience in the pre-operational stage of battery manufacturing, in particular providing technology and licensing support to European Batteries Oy’s lithium battery manufacturing facility in Varkaus, Finland.

K2 has launched a complete line of standardized format 18650 and 26650 lithium ion cylindrical cells for both energy (E) and power (P) applications. K2 Energy currently produces its battery cells and packs in China and has R&D, prototyping and battery pack assembly facilities in Nevada, US. Most of the company’s battery packs are sold in the United States of America and Europe.

Galaxy completed a feasibility study for the battery project in Q4 2010. For the production of 350,000 e-bike batteries per annum, the project is estimated to generate annual revenue of A$68 million and an average pre-tax net cash of A$30 million per annum. The non geared, net present value (NPV) of the project at a discount rate of 10% is estimated at A$187 million, with a project capital cost of around A$134 million. The internal rate of return (IRR) is around 29%.

Galaxy Resources plans to become a leading producer of lithium compounds. Galaxy wholly-owns and operates the Mt. Cattlin mine in Western Australia, which is currently producing spodumene (LiAlSi206) concentrate. (At full capacity, ore will be processed at a rate of 1 million tonnes per annum (tpa), with lithium oxide concentrate production of 137,000 tpa and 56,000 lbs pa of contained tantalum.)

Galaxy’s Jiangsu lithium carbonate plant, once completed, will have a design capacity of 17,000 tpa of lithium carbonate, which Galaxy expects would make it one of the largest plants in China converting hard rock lithium mineral concentrates into lithium compounds and chemicals.