Australian lithium miner Vulcan Energy Resources (VUL.AX) on Monday said it signed an agreement with LG Energy Solution (LGES) to supply lithium hydroxide for at least five years, a first of its kind for its European lithium project.
Vulcan, which operates in Germany's Black Forest area, said LGES would buy 5,000 metric tonnes (mt) of battery grade lithium hydroxide for the first year of the deal, and subsequently ramp it up to 10,000 mt per year.
LGES, a batteries unit of South Korea's LG Chem Ltd (051910.KS), will buy the raw material to produce battery cathode at the market price, Vulcan said in a statement.
Earlier this month, sources told Reuters Vulcan signed a memorandum of understanding with the French-Italian automaker Stellantis (STLA.MI) to supply lithium, a key ingredient in making electric vehicle (EV) batteries.
Vulcan plans to invest 1.7 billion euros ($2.01 billion) at its project in Germany to deliver lithium in a carbon-neutral manner, an attractive solution for automakers looking to procure the white metal with minimal disruption to the environment.
The deal with LGES, which can be extended by five more years, is expected to be finalised by the end of November, Vulcan said.