Core Lithium Ltd (ASX: CXO), Australia’s next lithium producer, announced that it has entered an agreement with electric car manufacturer Tesla Inc., Core Lithium will supply Tesla with lithium spodumene.
The deal drives Core Lithium shares up 13% in early trading. Australia’s next lithium producer stated that it would supply Tesla with up to 110,000 dry metric tonnes of spodumene concentrate from its Finnis Lithium Project.
According to the term sheet, the first lithium production from the Finnis Project is set for the fourth quarter this year, and the supply to Tesla is expected before July 31, 2023.
“The Term Sheet with Tesla is for the supply and delivery of up to 110,000 dry metric tonnes of spodumene concentrate over a term of 4 years. This adds to the previously announced binding offtake agreements with existing customers over 4 years.” Core Lithium Managing Director Stephen Biggins said.
“Subject to execution of a definitive agreement, Core’s supply to Tesla is scheduled to commence in 2H 2023 and will cease on the date that is 4 years after commencement of supply or until a total of up to 110,000 dry metric tonnes has been delivered,” Biggins stated.
“Core Lithium is thrilled to have reached this agreement with Tesla and look forward to further growing this relationship in the years to come. Tesla is a world-leader in electric vehicles and its investment in offtake and interest in our expansion plans for downstream processing are very encouraging,” he added.
Stage 3 Expansion
The strategy for the Finnis Lithium Project includes possible Stage 3 Expansion. It will be based on a long-term plan for the development of downstream lithium chemical processing in Australia’s Northern Territory.
Tesla has agreed and is subject to the execution of a definitive deal. The electric car manufacturer will provide additional support to Core Lithium for the completion of its Stage 3 Expansion and the incorporation of Core Lithium’s chemical product into the supply chain of Tesla.
Image Source: www.corelithium.com.au
