Vulcan Energy Resources Limited (ASX:VUL) has signed a binding lithium hydroxide offtake agreement with Korea’s LG Energy Solution for the supply of battery grade lithium chemicals.
LGES is the second largest battery maker in the world with over 20% market share and supplies its products to leading global Original Equipment Manufacturers (OEMs).
LGES is currently manufacturing lithium-ion batteries in Poland, US, China, and South Korea, and is looking at expanding its production capacity and is a leading battery supplier to European OEMs.
The Agreement is for an initial five-year term which can be extended by further five years, with a start of commercial delivery set for 2025.
LGES will purchase between 41,000 to 50,000 metric tonnes of battery grade lithium chemicals over the duration of the agreement.
“Our initial partnership with LG Energy Solution, the second largest battery producer in the world, was a significant first step in our strategy to engage with tier one battery, cathode and automakers in the European market,” Vulcan’s Managing Director, Dr Francis Wedin, said.
“The completion of the binding lithium offtake agreement with LG, in addition to our binding lithium offtake agreements with Volkswagen Group, Stellantis, Renault Group and Umicore, represents a globally unique achievement by the Vulcan Zero Carbon Lithium team.
“It means that we are fully sold out for the first five years of planned lithium production, which is an important foundation toward securing project finance. We look forward to a long and productive relationship with LGES.
Dong Soo Kim, Senior Vice President of Procurement Department at LGES, said that by joining forces with Vulcan Energy, LG Energy Solution aims to diversify supply chain and strengthen its competitiveness in the ESG sector.
“LGES promises to solidify and broaden its steady supply of raw materials in case of potential supply disruptions.”
Vulcan is aiming to become the world’s first lithium producer with net zero greenhouse gas emissions. Its Zero Carbon Lithium Project intends to produce a battery-quality lithium hydroxide chemical product from its combined geothermal energy and lithium resource, which is Europe’s largest lithium resource, in Germany.
The Vulcan Zero Carbon Lithium Project has a resource which could satisfy Europe’s needs for the electric vehicle transition, from a source with net zero greenhouse gas emissions, for many years to come.
For further information please visit: https://v-er.eu/
