Australian lithium miner, Chile's SQM choose site for new plant in West Australia

MELBOURNE, May 4 (Reuters) – Australian lithium miner Kidman Resources said on Friday it has chosen a site in Kwinana, Western Australia with Chilean joint venture partner SQM to develop a lithium processing plant.

The JV with SQM, whose full name is Sociedad Quimica y Minera de Chile SA, has leased a site in the industrial complex south of Perth for the project, known as Western Australia Lithium, Kidman said in a filing to the Australian Stock Exchange.

A final investment decision on whether to go ahead with the plant is expected by the end of the year, after the company has finished its definitive feasibility study. Kidman didn't say how much might be invested in the plant.

Western Australia Lithium will have a nameplate capacity of around 44,000 tonnes of lithium hydroxide or 37,000 tonnes of lithium carbonate. Construction is expected to begin next year before the plant comes on line for 2021.

Kwinana is fast set to become a global hotbed of battery chemicals manufacturing, ahead of an anticipated boom for electric vehicles. The Western Australian state government welcomed the Kidman-SQM plan and said it had set aside A$5.5 million ($4.1 million) to help fund battery technology development in the state.

The world's biggest lithium processing facility, run by China's Tianqi, is due to come on line late next year in the area with capacity of 48,000 tonnes of high grade lithium hydroxide.

Meanwhile global mining giant BHP Billiton is also building a facility there to produce nickel sulphate, also used in the development of battery chemicals.

($1 = 1.3298 Australian dollars)

(Reporting by Melanie Burton; Editing by Kenneth Maxwell)