Altech Chemicals (ASX:ATC) is busy with the finance and completion of its high purity alumina (HPA) facility in Malaysia.

But the company announced this morning that another plant could be on the cards — this time in the German state of Saxony.

Altech is considering a written invitation from the local government to build the state’s second HPA production facility.

ATC shares ticked higher by 4 per cent in morning trade to 13c.

Supply shortage

HPA is increasingly tied to the oncoming boom in electric vehicle production, due to its use as a coating layer in the production of lithium-ion batteries.

Altech said Saxony, the fourth most populous state in Germany based in the east of the country, is looking to establish a major electric vehicle industry in the region.

The state is a key part of the supply chain for leading German car manufacturers including Volkswagen and BMW.

Altech’s German advisory team has now met with local government representatives. It will now “undertake further evaluation, which will include research on various government grants that the company has been advised may be available”.

The company said a German facility could make sense strategically, with reference to both the potential for a global supply shortfall in HPA along with the pro-EV regulatory environment in European jurisdictions.

Altech cited a report fro CRU Consulting which forecasts a HPA supply shortfall of 20,000 tonnes per annum (tpa) in 2021, increasing to 50,000tpa by 2028.

The processing capacity of Altech’s Malaysian plant under construction is around 4,500tpa.

Following a direct invite from the Saxony government along with Europe’s push towards low-emission solutions, Altech said its “current strategic thinking is for its next HPA plant to be located in Europe”.

ALSO READ: Altech takes first steps to lock in $142 million HPA funding deal

In other ASX battery metals news today:

Metalsearch (ASX: MSE) confirmed plans to carry out an initial drilling program at its Abercorn HPA project in central Queensland. The company will seek shareholder approval at the AGM in early October, before commencing a 60-70 hole reverse circulation drilling program in mid-October. Shares in the company edged 6 per cent lower to 1.5c.

Energy storage company Redflow Limited (ASX:RFX) has signed a deal to provide 68 zinc-bromine flow batteries to mobile phone tower sites owned by “one of Africa’s leading telecommunication companies”. Details weren’t disclosed but RFX said it expected to receive revenue before the end of this year that had a “commercial gross margin”. Shares in FRX were up 7.5 per cent to 4.3c.

And Jadar Lithium (ASX:JDR) has announced the appointment of Dejan Jovanovic as general manager of exploration. A geologist by training, Jovanovic’s career background includes time spent at Rio Tinto (ASX:RIO) working at the major’s jadar lithium-borate deposit in Serbia.