Only days after Queen Creek, Pinal County officials and company representatives assured residents plans for the lithium battery plant were proceeding, LG Energy Solution indicated the project’s future might be up in the air.
On June 24, – three days after a town hall cosponsored by the town and county – AZBEX, a digital news site serving the local architecture, engineering and construction industry, reported that two contractors associated with the project said it’s been put on hold.
Ian Calkins with Copper State Consulting Group, a public affairs consultant for LG Energy Solution, in a June 28 email to the Tribune, wrote, “Given the unprecedented economic condition and investment circumstances in the US, LG Energy Solution is currently reviewing various investment options, but no decision has been made."
Town spokeswoman Constance Halonen-Wilson said the town is “continuing to work with the company on this milestone project.”
“We remain excited about what this advanced manufacturing corridor will do for our region and State as it continues to grow and attract more interest from companies domestically, and globally,” Halonen-Wilson said in an email June 28.
According to DATABEX—the research staff of BEX— spoke with Blount Contracting, Inc., the grading subcontractor based in Apache Junction, on June 22.
Blount said in the article that LG Energy Solution “has pulled the contract for their civil work and that it will not be starting for the next two-to-three years.”
Ironically, work is continuing quickly two other plants that are part of LG’s $4.5 billion plan to expand its American operations by 2025 as it tries to top its Chinese rival as the largest supplier of lithium batteries for electric vehicles and create 10,000 jobs in the United States.
An American subsidiary of the company, ES America, was the sole bidder in April at a state Land Department auction of the 650.5-acre site at Ironwood and Germann roads where the Queen Creek plant will be located. ES paid $84.4 million for the property and the town is investing millions in road and other infrastructure work around the site.
DATABEX also reported that Yates Construction, the general contractor for the project headquartered in Philadelphia, Mississippi, confirmed LG had placed the project on hold on June 17 and estimated the hold will remain in place for four-to-six months.
LG is building advanced automotive battery manufacturing plants in Spring Hill, Tennessee, and Holland, Michigan.
Construction “will continue as planned” for those two factories being jointly built with General Motors Co., LG officials said in an interview with The Korea Bizwire.
Korea Bizwire reported on June 29 that LG had decided to reconsider its $1.31 billion plan for Queen Creek because its estimated cost has swelled to nearly $2 billion amid global inflation and the recent sharp depreciation of the Korean currency, according to the article.
“We are thoroughly reassessing the timing, scale and details of the investment, due to a sharp increase in investment costs stemming from the deteriorating business environment,” an LG official said in the article.
On June 23, the value of South Korea’s currency, the won, fell below the 1,300-won-to-1-U.S.-dollar for the first time in nearly 13 years, according to Korea Bizwire.
It is expected to take at least four to six months before LG makes its decision on the Arizona plant, according to Korea Bizwire.
According to Pinal County officials, a public hearing for the the Queen Creek plant’s air quality permit is still scheduled for July 12 at 6 p.m. at the Combs High School Performing Arts Center, at 2505 East Germann Road.
The Industrial Permits Public Notice provides an opportunity for public comment before county officials take action on a permit.
“Any person who may be adversely affected by the requested permit/revision may offer oral or written objection to the terms of or issuance of such permit/revision, and may request a public hearing,” according to Pinal County website.
