PERTH (miningweekly.com) – Lithium developer Liontown Resources has inked a sales agreement with electric vehicle (EV) giant Tesla for the supply of spodumene concentrate from its Kathleen Valley project, in Western Australia.

Under the agreement, Liontown will supply up to 150 000 t/y of spodumene concentrate, starting in 2024, representing one-third of Kathleen Valley’s startup production capacity of 500 000 t/y.

The agreement with Tesla is the second offtake arrangement secured for Kathleen Valley following the foundational offtake arrangement with LG Energy Solutions. The two offtake agreements mean that more than half of Liontown’s planned production is now covered by long-term agreements with high-quality customers.

“Securing our second offtake sales agreement is another fantastic milestone for Liontown towards the development of the Kathleen Valley lithium project, and we are absolutely delighted to have signed this agreement with leading EV manufacturer, Tesla,” said Liontown MD and CEO Tony Ottaviano.

“Tesla is a global leader and innovator in EVs and having it sign up to become a significant customer is a tremendous achievement and another huge vote of confidence in the quality of the Kathleen Valley project. This means that we now have two of the premier companies in the global lithium-ion battery and EV space signed up as foundational customers, marking a significant step towards realising our ambition to become a globally significant provider of battery materials for the clean energy market. Our shareholders should be proud that future Tesla cars will be powered by Liontown lithium.

“We look forward to working with Tesla as long-term partners for many years to come.

“We are also continuing to progress discussions with additional potential customers for the remaining available production and we are looking forward to announcing additional arrangements in the weeks ahead as we continue to implement our strategy to develop the project and deliver value for our shareholders.”

Liontown and Tesla will now work together to complete the negotiation and execution of detailed definitive agreements which must be completed and executed by the end of May.