Liontown Resources Australia announced it has signed an agreement with a
Tesla plant to supply lithium spodumene concentrate. The contract with the
electric car manufacturer will run for five years.
Wednesday (16/2), Tesla will buy 100,000 dry metric tons (DMT) of
concentrate in the first year starting in 2024. Citing Reuters, Tesla will
then increase purchases to 150,000 DMT per year in the following year.
Liontown plans to supply lithium from its flagship Kathleen Valley Lithium
project in Western Australia, which is expected to start commercial
production in 2025. Supply to Tesla will account for about a third of the
project's annual production capacity.
Previously, Liontown also had a lithium supply agreement with South Korea's
LG Chem battery unit from the project.
For your information, lithium prices have soared in recent years, with
suppliers scrambling to meet demand as automakers gravitate towards electric
vehicles. The price is about eight times higher than in early 2021.
Following the announcement of the signing, Liontown shares jumped 19.8% to
A$1,665, their biggest intraday jump since September 13, 2021.
