On March 2, Australian lithium miner CoreLithium (CXOXF.US) announced a supply agreement with TSLA.US, the world leader in electric vehicles, to supply tesla with up to 110,000 tons of spodumene concentrate over four years. Boosted by the news, CoreLithium closed more than 16 percent in U.S. stocks on Tuesday.
Core Lithium said supply plans to Tesla are expected to begin in the second half of 2023 with spodumene concentrate coming from the Finniss lithium mine project near Darwin Harbour in Australia's Northern Territory. The project has 14.72 million tons of ore resources, with an average grade of 1.32% lithium oxide, about 478,000 tons of lithium carbonate equivalent (LCE), and an annual production capacity of 173,000 tons of spodumene concentrate.
The Finniss lithium project is expected to produce the first spodumene concentrate in the fourth quarter of 2022, meaning Core Lithium will be the new spodumene producer in Australia this year.
According to the relevant information, Core Lithium's Finniss lithium mine project has been awarded the title of major project of the Australian Federal Government, and has previously received $6 million in funding from the Australian government's MMI program.
With the outbreak of demand in the electric vehicle market and the increasingly tight supply of lithium, nickel, cobalt and other battery raw material metals, Core Lithium's lithium project in Australia has previously attracted the attention of Chinese mining giants.
In 2019, Core Lithium signed an off-take agreement with Sichuan Yahua Industrial Group Co., Ltd. (002497, hereinafter referred to as Yahua Group) for 75,000 tons of lithium concentrate per year. Yahua Group has become Tesla's battery-grade lithium hydroxide supplier since the end of 2020.
In 2021, CoreLithium signed a four-year underwriting agreement with Jiangxi Ganfeng Lithium Co., Ltd. (002460, hereinafter referred to as Ganfeng Lithium) to underwrite 75,000 tons of spodumene concentrate produced by the Finniss Project per year. At the same time, Ganfeng Lithium made an equity investment in CoreLithium for a total price of 34 million Australian dollars. Ganfeng Lithium is also a supplier of Tesla's battery-grade lithium hydroxide products, and last November it continued with Tesla for another 3 years.
Core Lithium's second quarter 2022 operating report released in January this year shows that with the product underwriting agreement and the company's strategic investor Ganfeng Lithium and other investment participation funds in place, the lithium exploration company is rapidly transforming into a lithium producer.
At the same time, in order to ensure the supply of electric vehicle parts, major automakers have also begun to lay out the upstream industrial chain, and many car companies have also begun to try to develop their own power batteries. As the world's leading electric vehicle, Tesla began to lay out the battery field as early as 2015.
In 2020, Tesla's "Roadrunner" power battery self-production plan was officially launched. In the factory in Fremont, USA, the first power battery production line belonging to Tesla began to take shape.
In the past six months, with the increase in battery production capacity, Tesla has reached supply agreements with graphite supplier Syrah Resources and Australian lithium miner Liontown Resources.
On February 19, Tesla announced that a pilot plant in Fremont, California, had produced its 1 millionth 4680 battery in January this year, marking the official entry of the 4680 battery into mass production.
Meanwhile, deliveries of the first Tesla Model Y models with 4680 batteries are expected to begin at the end of the quarter. It is understood that each Model Y requires about 1000 4680 batteries, and 1 million 4680 batteries is enough to produce about 1000 Model Y.
