Piedmont Lithium and automaker Tesla have mutually agreed to amend a September 2020 offtake agreement for spodumene concentrate (SC6).
Under the new agreement, which is binding for a three-year term and includes an option to renew, Piedmont will deliver approximately 125,000 metric tons of SC6 to Tesla beginning in the second half of 2023 through the end of 2025.
According to the terms, the SC6 pricing will be determined by a formula-based mechanism linked to average market prices for lithium hydroxide monohydrate throughout the term of the agreement. The pricing received by Piedmont under the agreement with Tesla will be determined by market prices at the time of each shipment.
“The electric vehicle and critical battery materials landscape has changed significantly since 2020 and this agreement reflects the importance of – and growing demand for – a North American lithium supply chain,” said Piedmont Lithium President and CEO Keith Phillips.
“This agreement helps to ensure that these critical resources from Quebec remain in North America and support the mission of the Inflation Reduction Act to bolster the U.S. supply chain, the clean energy economy, and global decarbonization.”
Piedmont said it plans to deliver SC6 to Tesla from North American Lithium under Piedmont’s offtake agreement with Sayona Quebec, which entitles Piedmont to purchase the greater of 113,000 metric tons per year or 50% of SC6 production.
Piedmont’s purchases of SC6 from Sayona Quebec are subject to floor and ceiling prices for the life-of-mine term. Sayona Quebec is a joint venture between Sayona Mining (75%) and Piedmont Lithium (25%).
Source: Piedmont Lithium