Tesla Confirms Plan to Build a Lithium Refinery in Texas

Tesla Battery Day. Photo: Tesla

Tesla confirms a plan to build a lithium refinery in Corpus Christi, Texas. At this facility, it will package and ship battery-grade lithium hydroxide for its 4680 battery cells.

Tesla is advancing plans to build a lithium refinery on the Gulf Coast of Texas. Chief Executive Officer Elon Musk confirmed the move on Wednesday on the Q3 2022 Earnings Call in response to an analyst's question about progress in developing the company's new 4680 battery cell technology.

“Yes. We're also building lithium refinery,” he said. Another company executive said the location is in Corpus Christi, Nueces County, which up until now had been considered a potential location, with no official confirmation from Tesla.

The manufacturer considered the project for several months. In addition to the named location in Texas, it was known that Tesla was considering another site in Louisiana. The company has told the state regulators that it plans to build a battery-grade lithium hydroxide processing plant near Corpus Christi that will process raw ore. At this facility, it would package and ship battery-grade lithium hydroxide to “various Tesla battery manufacturing sites supporting the necessary supply chain for large-scale and electric vehicle batteries,” according to an application it sent to the Robstown Independent School District under the state's Chapter 313 tax incentive program.

This plant will be the first of its kind in North America and will be able to process and refine materials used in batteries in addition to lithium hydroxide. As previously reported, early construction could begin in Q4 2022, and judging by Musk's statement during the Earnings Call, the company has already begun that. The commercial operation could begin by Q4 2024.

Tesla plans to invest $375 million to build the factory. During the construction phase, this will create up to 250 jobs in the next two years. For the further operation of the factory, 162 permanent jobs will be needed. Of these, 10 will pay $81,000/year with benefits, while the remaining positions will pay close to the regional average of about $53,000/year and will not qualify for benefits.

Lithium prices have become very expensive in recent years, although the earth is very rich in metal. Musk has repeatedly urged entrepreneurs to start recycling lithium to eliminate supply bottlenecks in a key material used in lithium-ion batteries. Obviously, the industry has not developed at the pace that is needed, and if it does not start mining lithium now, then in a few years the industry will face a serious shortage of material, which will prevent the production of the required number of batteries.

© 2022, Eva Fox | Tesmanian. All rights reserved.

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