Australia-listed Vulcan Energy has signed a binding offtake agreement to supply South Korea's LG Energy Solution (LGES) with battery grade lithium hydroxide from it's 'zero carbon' facility in Germany, the producer said on Monday July 19.
Vulcan will supply battery-grade lithium hydroxide to LGES for an initial five-year term. Commercial deliveries are set to commence in 2025 and there is an option to extend the supply deal for a further five years, Vulcan said.
Battery-grade lithium hydroxide is typically used to produce nickel-rich nickel-cobalt-manganese (NCM) lithium-ion batteries for electric vehicles.
LGES will buy 5,000 tonnes in the first year of the supply term, rising to 10,000 tonnes per year from the second year onward, Vulcan said.
The lithium hydroxide Vulcan supplies will be produced from the deep brine source at its Zero Carbon Lithium project in Germany, where it owns a combined geothermal energy and lithium resource - the latter being Europe's largest lithium resource.
"This is the first binding lithium offtake term sheet for the Zero Carbon Lithium project, so it is fitting that it is with the largest [electric vehicle] battery producer in the world, [which] already produces batteries in Europe. The agreement is in line with our strategy to work with tier-one battery and automotive companies in the European market," Vulcan's managing director Francis Wedin said.
Fastmarkets' weekly price assessment for lithium hydroxide monohydrate 56.5% LiOH.H2O min, battery grade, spot price, cif China, Japan & Korea, was $14.50-16.50 per kg on Thursday July 15 , unchanged from the previous week.