Korea Zinc Advances $6.6 Billion U.S. Smelter With Federal Backing

Korea Zinc has secured a conditional commitment from the U.S. Department of War and the Department of Commerce to support construction of a large-scale critical minerals smelter in Tennessee, a move aimed at restoring domestic processing capacity and reducing U.S. dependence on overseas supply chains, according to company and government statements.

The planned facility in Clarksville would require about $6.6 billion in capital expenditures, with total investment reaching $7.4 billion including working capital and financing costs. If completed, it would represent the first major U.S. zinc and critical minerals smelter developed since the 1970s, highlighting Washington’s growing focus on supply chain security.

U.S. demand for base and strategic metals has risen sharply with the expansion of electric vehicles, batteries, semiconductors, data centers and defense manufacturing. However, domestic smelting capacity has steadily declined. Data published by the U.S. Geological Survey show the country is fully import-dependent for several critical minerals, including gallium and indium, a vulnerability policymakers are seeking to address.

Korea Zinc said it plans to build an integrated smelter covering about 650,000 square meters, capable of processing roughly 1.1 million metric tons of raw materials annually and producing about 540,000 tons of finished metals. Thirteen nonferrous products are planned, ranging from zinc, lead and copper to precious and strategic metals such as gold, silver, antimony, indium, gallium and germanium. Eleven of those products are designated as critical minerals by the U.S. government.

Site preparation is expected to begin in 2026, with construction starting in 2027 and phased commercial operations targeted for 2029. Initial production will focus on zinc, lead and copper, with additional metals added later. Analysts note that the Clarksville site offers logistical advantages, relatively low power costs and existing industrial infrastructure.

As part of the project, Korea Zinc has agreed, subject to conditions, to acquire Nyrstar’s U.S. zinc operations at the same location. Observers say this would allow the company to retain an experienced workforce and accelerate ramp-up at what is currently the only zinc smelter operating in the United States.

Korea Zinc said it will apply technology and operational expertise from its Onsan smelter in South Korea, the world’s largest single-site nonferrous smelting complex, and deploy experienced personnel to the U.S. project to reduce technical risks.

Analysts say the Tennessee smelter could become a benchmark for allied cooperation on critical minerals, though its success will depend on execution, cost control and long-term policy support as global competition for processing capacity intensifies.

Source: Korea Zinc

SUNSHINE Spotlight: Korea Zinc’s Tennessee smelter plan signals a rare convergence of industrial policy and private capital as the United States moves to rebuild domestic critical minerals processing capacity.