Portugal’s Lifthium wins $210 million grant for lithium refinery

Portugal’s Lifthium Energy has been awarded a 180 million euro ($210 million) government grant to build a lithium refinery in the country’s north for the fast-growing electric vehicle battery market.

With 60,000 metric tons of reserves, Portugal is Europe’s top lithium producer, supplying mainly the ceramics industry. It has only recently sought to produce battery-grade lithium.

The company said the non-refundable grant was awarded under the European Union’s Temporary Crisis and Transition Framework, which allows state incentives to speed the green and industrial transition.

Lifthium, 85% owned by Portuguese conglomerate Jose de Mello with the remainder by its subsidiary Bondalti, will build the refinery in the northern town of Estarreja, about 50 km (31 miles) south of Porto.

Bondalti, Portugal’s largest chemicals producer, already operates sites there and Lifthium aims to start operations by 2030.

Lifthium CEO Duarte Braga said the project was advancing “with rigour and prudence”, as the lithium market and Europe’s industrial environment had become significantly more challenging over the past two years.

He said the public incentive was important, but the focus now was on securing a strategic partner and firming up market and financing conditions before a final investment decision.

In addition to the Estarreja plant, Lifthium may build another refinery in Spain, he said.

The company is aiming for annual refining capacity of 50,000 tons of lithium hydroxide, enough to supply batteries for two million EVs, using proprietary technology designed to meet Europe’s environmental and industrial standards.

The government hopes to launch a long-delayed tender for lithium prospecting licences this year, seen as key to building a domestic lithium value chain and cutting Europe’s reliance on imports from countries including China.

($1 = 0.8594 euros)

(By Sergio Goncalves; Editing by Mark Potter)