On Monday, Australian lithium miner Piedmont Lithium stated, it has signed a five-year deal with U.S. electric carmaker Tesla Inc for the supply of high-purity lithium ore mineral.
With the news reaching the market Piedmont Lithium’s shares surged by 83%, touching its zenith since May 2007.
The five-year agreement will see Piedmont supplying nearly around one third of its planned 160,000-tonnes-per-year spodumene concentrate produce from its deposits in North Carolina. The agreement has a clause to extend the deal for another five years.
The deal comes at a time when Tesla’s “Battery Day” presentation saw its stock lose more than $30 billion in market value. Last week Tesla’s CEO Elon Musk shared his vision of a new kind of proprietary Tesla batteries which will see consumers gain access to more cost effective batteries.
In a statement Piedmont said, the agreement marks the beginning of the its first U.S. domestic lithium supply chain; talks are also ongoing over other sales arrangements.
Tesla did not respond to request for comments outside regular business hours.
Piedmont went on to add, the deal is subject to both companies agreeing to start deliveries between July 2022 and July 2023.