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SANTIAGO, Sept 21 (Reuters) - Chilean fertilizer and chemical producer SQM will invest around $30 million by the end of 2017 to increase its annual lithium hydroxide production capacity by 7,500 tonnes, the company said in a press release on Wednesday.
As part of the plan to boost capacity from 6,000 tonnes to 13,500 tonnes, the company said it would seek to improve efficiency at a plant near the northern Chilean city of Antofagasta, and would construct a new facility with an annual capacity of 7,000 tonnes.
Lithium hydroxide is used mainly in the production of heavy-duty lubricants, though SQM CEO Patricio de Solminihac said in a statement that it is being increasingly used in the lithium batteries that power electric cars.
The deal comes as SQM is facing arbitration proceedings in Chile with government-run economic development agency Corfo over leasing payments, as well as an investigation over whether it exported lithium without proper authorization. (Reporting by Gram Slattery; Editing by Diane Craft)