Electric vehicle maker signs agreement to secure lithium hydroxide from proposed new refinery in Western Australia. () continues to ride high on the lithium wave and the latest crest is the signing of a lithium hydroxide offtake agreement with electric vehicle giant Tesla. The binding agreement is for an initial term of three years on a fixed-price take-or-pay basis from the delivery of first product and contains two three-year term options. It further validates Kidman’s strategy of being an integrated manufacturer of battery-grade refined lithium. Investors have demonstrated their support of the strategy with shares up 8% intra-day to $2.34 on volume of more than 9 million. Recent news flow has seen Kidman reach a 12-month high of $2.37 earlier this month. The Tesla agreement follows Western Australia Lithium (WAL), Kidman’s 50:50 joint venture with Sociedad Quimica y Minera de Chile (SQM), signing an option to lease land for a proposed lithium refinery. WAL has entered into an exclusive option to lease a premier site in the Kwinana Strategic Industrial Area in Western Australia. The Tesla agreement equates to less than 25% of Kidman’s portion of initial nameplate production for the first three years from the refinery. In addition to this agreement, Kidman is in discussions with other strategic, globally significant parties also seeking refined lithium offtake. Expressions of interest to date have materially exceeded Kidman’s portion of initial refinery nameplate production. Kidman is targeting to enter into a limited number of offtake agreements while leaving a minority portion of future supply uncontracted.
US-based battery and electric vehicle manufacturer Tesla has signed a lithium hydroxide offtake deal with Australian miner Kidman Resources. The supply agreement is for an initial term of intra-day on a fixed-price take-or-pay basis from a new refinery. The supply will come from Kidman's Western Australia Lithium joint venture with Chile's SQM which has signed an option to lease land for a new lithium refinery at the Kwinana Strategic Industrial Area in Western Australia.The deal with Tesla will represent less than 25% of Kidman’s share of initial nameplate production from the new facility.