South Korean companies in electric vehicle and battery sectors are considering joining overseas mining projects through the U.S.-led Minerals Security Partnership (MSP) to secure key minerals to help strengthen the supply chain as they reduce excessive reliance on China.

LG Energy Solution Ltd., SK on Co. and POSCO Holdings Inc. are considering taking part in demonstration mining projects for rare-earth elements, nickel and lithium led by the mineral partnership in Australia and Argentina, Maeil Business Newspaper has learned on Tuesday.

“So far, companies had secured key minerals by themselves but now they are able to diversify their supply chain through the international partnership,” said an unnamed government official.

MSP ? launched by the U.S. Department of State in June last year ? is an international cooperation partnership that aims to diversify and stabilize the supply network of key minerals. Thirteen countries have joined the group, including Korea, European Union, Canada and Japan.

Some industry insiders see the MSP as a move by the U.S. to weaken China’s dominance in the key minerals market.

The Korean government plans to provide all the support to the companies taking part in the MSP-led projects as it sees the partnership as a cooperative platform that offers opportunity for the companies to secure key minerals.

The MSP held two rounds of meetings and decided recently to carry out 16 overseas mining projects as a demonstration.

Some of the projects have already been launched while others are seeking countries to join. Korean companies have expressed interest to join in three projects in Australia and Argentina.

According to data from Korea Mine Rehabilitation and Minerals Resources, volatility of six strategic minerals, including nickel and zinc, worsened since July last year amid the Russia-Ukraine war.

By Song Gwang-sup and Lee Eun-joo

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]