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Tesla gets closer to volume battery cell production with 5-year lithium supply deal

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Australian mining firm Piedmont Lithium announced on Monday that it has signed an last-minute distribution deal with Tesla. Under the conditions of the two companies’ agreement, Piedmont are supplying approximately a third of its planned 160,000-tonnes-per-year spodumene focus produce from its own North Carolina mines into the American electrical car manufacturer.

At a press release, Piedmont noticed that although its initial agreement with Tesla is place for five years, both companies have an choice to extend the contract for another five years. The Australian mining firm added that although its initial agreement with Tesla represents about one-third of its North Carolina mine’s anticipated 160,000 tonnes per annum manufacturing, more lithium might be sent to Tesla when needed.

Deliveries for Tesla’s lithium can start between July 2022 and July 2023 according to the developmental programs of Tesla and Piedmont. In a declaration, Keith Phillips, the President and Chief Executive Officer of Piedmont Lithium, expressed his enthusiasm about the Tesla deal. Phillips also noticed that Piedmont will be accelerating its mining development to be able to support Tesla’s plans.

&ldquoWe are excited to be working with Tesla, that signifies the beginning of the US nationwide lithium supply chain and a disturbance to the current value chain. The Agreement highlights the strategic value of Piedmont’so unique American spodumene deposit and confirms the trend toward spodumene since the preferred feedstock to the lithium hydroxide demanded in high-nickel batteries.

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&ldquoWe will now accelerate our mine/concentrator development to support Tesla’therefore plans, work to further enlarge our mineral assets, and possibly increase our proposed yearly spodumene focus manufacturing capacity. We will concurrently be progressing our strategies to create lithium hydroxide from North Carolina, employing a combination of semi produced spodumene focus as well as material sourced from different manufacturers around the planet,” Phillips stated.

The Tesla deal seems to have been appreciated from the Australian miner’s shares. After its statement, Piedmont Lithium’s shares experienced an 83% increase .

Tesla’therefore battery mobile manufacturing initiative has caught the interest of the electrical vehicle sector. During the company’s Battery Day occasion, Tesla summarized its mobile manufacturing application, which requires a ground-up redesign of those batteries which are employed for the company’s vehicles and energy storage solutions. The consequence of Tesla’s attempts was the Roadrunner mobile, that adopts a 4680 form factor, allowing it to have 5x the quantity of those 2170 cells used in the Model 3 and Model Y.

But for Tesla to attain its own battery production targets, it would have to seal the deal with companies including Piedmont Lithium, which might supply the electrical car maker with the essential materials to produce cells. Past reports have suggested that the company is currently in the process of securing partners for its own battery manufacturing drive. Apart from Piedmont Lithium, as an example, reports have suggested that Tesla is in discussions with Canadian mining firm Giga Metals about the development of a low-carbon nickel mine, that may also be built in North America.

Piedmont Lithium’s press release can be obtained below.

Piedmont Lithium Deal by Simon Alvarez on Scribd

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