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Australian lithium company, Liontown Resources, has secured another offtake agreement for its Kathleen Lithium project. The agreement with global car manufacturer Ford, means that it will now be the third offtake partner as part of the foundational financing for the development of the Project. Lithium is key for the batteries in electric vehicles in order to allow the vehicles to store electrical energy.
The agreement specifies that LTR will supply Ford with up to 150,000 dry metric tonnes, (DMT) per annum of spodumene concentrate. For the first year, they will provide 75,000 DMT, 125,000 DMT in year 2, and then 150,000 DMT for the remaining 3 years of the initial term of the agreement. Lisa Drake, Ford Vice President of EV industrialisation stated, “Ford continues working to source more deeply into the battery supply chain to meet our goals of delivering more than 2 million EV’s annually for our customers by 2026.”
This makes up a third of the foundational offtakes for the Kathleen Project with Tesla and LG also committing to offtake agreements with the company. The current Kathleen project will be able to produce approximately 500,000 tonnes of spodumene concentrate per annum before expanding to approximately 700,000 tonnes once production starts. The financing of the development will be supported by an agreement in which, Ford will supply $300,000,000 AUD. This combined with $463,000,000 AUD raised by LTR last year should cover the development of the project until production.
The LTR share price was up by 5.4% to $1.12 as of 11.41 EST 29 June 2022 as the market reacted to the news.
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