South Korean steel and chemicals group Posco Holdings announced it has finalised an agreement worth US$ 765 million to acquire a 30% stake in two lithium mines owned by Australia’s Mineral Resources Ltd, as the company looks to strengthen its position in the global battery materials supply chain.

Mineral Resources announced last November that it had reached a preliminary agreement with Posco to sell a stake in its lithium mining operations to help reduce its debt. Under the agreement, a new joint venture will be established between Posco and Mineral Resources, with rights to the latter’s Mount Marion and Wodgina mines in Western Australia.

Wodgina is one of the largest lithium mines worldwide, with around 6.2 million tons of lithium carbonate reserves, while the Mount Marion mine is estimated to have reserves of around 2.2 million tons. The two mines are expected to produce a combined 37,000 tons of lithium hydroxide per year for Posco, enough to power more than 900,000 electric vehicles (EVs).

Lithium prices have surged by close to 50% since the beginning of the year, following sharp declines in the previous two years, reflecting growing demand from the energy storage systems (ESS) sector and tightening supply in China.