The surge in adoption of electric vehicles (EVs) has set off an unprecedented demand for lithium, which is a primary ingredient in lithium-ion batteries that powers these vehicles. As EV producers scramble to secure a consistent and reliable supply of lithium, several lithium producing juniors have made significant inroads by securing long-term supply deals. Let’s delve into some of these strategic partnerships between lithium juniors and EV makers.
One of the notable lithium juniors stepping up to meet the accelerated lithium demand is Piedmont Lithium. Securing a landmark deal with Tesla, the global leader in electric vehicle production, Piedmont has set its eyes on becoming one of the key lithium producers in the market. In this five-year supply pact, Tesla agrees to buy spodumene concentrate, a type of lithium ore, directly from Piedmont’s open-pit mine located in North Carolina. The deal, with an extension option for a further five years, showcases confidence in Piedmont’s ability to supply high-quality lithium ore consistently, reinforcing Piedmont’s strategic merit in the lithium supply chain.
The Australia-based lithium miner, Pilbara Minerals, is also in the limelight for its supply contract with EV giant Tesla. This agreement provides Tesla with the rights for up to 15% of Pilbara’s spodumene concentrate production from its Pilgangoora Lithium-Tantalum Project in Western Australia. The deal resonates with Pilbara’s capabilities in scaling up operations to match the growing demands, ensuring a regular lithium supply to Tesla. Moreover, the agreement further solidifies Pilbara’s global reputation as a reliable lithium concentrate producer.
Vancouver-based lithium explorer, Lake Resources, inked an offtake agreement with the European lithium-ion battery producer, Novonix. This definitive agreement secures Novonix with the supply of 50,000 tonnes per annum of Lake’s high-quality lithium carbonate for a period of three years. The deal indicates the burgeoning demand for clean, high-purity lithium and manifests Lake’s commitment towards producing premium lithium carbonate that meets stringent industry requirements.
The Chinese EV manufacturer, Great Wall Motors, partnered with Australia’s lithium miner, Ganfeng Lithium, for a five-year lithium supply contract. Under the agreement, Ganfeng will ensure a steady supply of lithium to Great Wall Motors, signifying the critical role Ganfeng plays in the lithium battery supply chain. The agreement aligns with the global shift towards clean energy and the exponential rise in demand for lithium-ion battery-powered vehicles.
The burgeoning lithium demand touches upon another renowned lithium junior, Sigma Lithium, who signed a long-term supply agreement with LG Energy Solution, a South Korea-based lithium battery producer. This agreement sees Sigma Lithium supplying its high-purity, low-impurity hard rock spodumene concentrate to LG Energy Solution, marking another significant milestone in securing lithium supply for EV battery manufacturers.
By signing these long-term supply deals, these lithium juniors aren’t just bolstering their standing in the supply chain but are also contributing to the acceleration of the adoption of electric vehicles by ensuring a consistent lithium supply. As the world continues to transition towards greener solutions, these strategic collaborations between lithium juniors and EV makers will undeniably propel the evolution of the electric vehicle and energy storage sectors.