Cyber Monday Deal: Up to 60% off InvestingProCLAIM SALE

Tesla Enters 5-Year Deal With Australian Lithium Supplier Liontown Resources

Published 02/16/2022, 11:45 AM
Updated 02/16/2022, 11:47 AM
© Reuters.
TSLA
-
LTR
-

By Sam Boughedda

Investing.com — Liontown Resources Ltd (ASX:LTR) announced Wednesday that it has a deal with Tesla Inc (NASDAQ:TSLA) to supply lithium spodumene concentrate, news that sent its stock up 18% during the Australia session.

The material will come from Liontown's new A$473 million ($337 million) Kathleen Valley Lithium Project in Western Australia.

The deal is for an initial five years and is set to begin in 2024.

Tesla will purchase 100,000 dry metric tonnes in the first year, increasing to 150,000 per year in subsequent years.

Liontown said major construction work at the project is scheduled to begin in the fourth quarter 2022.

While no financial details were disclosed, Liontown said pricing was determined using a formula-based mechanism referencing market prices for lithium hydroxide monohydrate.

Liontown has now contracted over half of its anticipated production from Kathleen Valley during the first five years of operation, while it is continuing negotiations with other potential customers for the remaining output.

Tesla shares are down 1.29% Wednesday.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.