---
title: Spodumene-to-Lithium-Hydroxide Refining
type: technology
url: "https://www.envisioning.com/research/stratum/australia-nz__lithium-hydroxide-refining"
hub: stratum
summary: "Australia is battling to master lithium hydroxide refining at Kwinana — Tianqi's Phase 2 was terminated in Jan 2025, but the technology race to produce battery-grade LiOH domestically continues."
---

# Spodumene-to-Lithium-Hydroxide Refining

Australia is battling to master lithium hydroxide refining at Kwinana — Tianqi's Phase 2 was terminated in Jan 2025, but the technology race to produce battery-grade LiOH domestically continues.
- Technology Readiness Level: 7/9
- Impact: 4/5
- Investment: 3/5
Australia is the world's largest lithium producer from hard-rock (spodumene) mining but has struggled to master downstream refining into battery-grade lithium hydroxide. The Tianqi-IGO joint venture's Kwinana refinery — designed for 24,000 tonnes per annum — faced persistent commissioning challenges and underperformance, with Tianqi terminating Phase 2 construction in January 2025 and IGO reporting low confidence in the asset by August 2025. Albemarle also exited its Australian lithium hydroxide plans, creating both a setback and an opportunity for local players.

Converting spodumene concentrate to battery-grade lithium hydroxide (LiOH·H₂O, ≥56.5% purity) involves complex multi-stage chemical processing: calcination at 1,050°C, acid roasting, leaching, impurity removal, and crystallization — each requiring precise control. The technology has been dominated by Chinese processors who refined it over decades with government support. Australia's attempts to replicate this domestically encountered a steeper learning curve than anticipated, with the Kwinana experience demonstrating that first-of-kind processing facilities need extended ramp-up periods.

Despite setbacks, the strategic imperative remains. Australia exports ~300,000 tonnes of spodumene concentrate annually, capturing perhaps $2,000/tonne, while battery-grade lithium hydroxide sells for $15,000-25,000/tonne. Mastering downstream processing would multiply the value captured domestically by 5-10x. The lessons from Kwinana's challenges are informing next-generation refinery designs with improved process control and lower capital costs, while the Critical Minerals Strategy provides policy support for continued investment in domestic refining capability.

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Source: Envisioning — Technology Research Institute (https://www.envisioning.com/research/stratum/australia-nz__lithium-hydroxide-refining)