Australian graphite company Magnis Energy Technologies announced today that it had inked an offtake agreement with leading American EV maker Tesla to supply Anode Active Materials (AAM), which is basically made of graphite.
For context, Magnis developed the technicalities of its AAM production using Nachu graphite concentrate at its New York facilities for seven years. The company employed sustainable processes in producing the materials, ensuring that there would not be any thermal or chemical purification.
“We are really excited to bring our high performing AAM to market that requires no chemical or thermal purification throughout the whole process, which differentiates this sustainable material in the market and provides great value to all parties.”
Frank Poullas, Magnis Chairman
Notably, the deal occurred amid the race of global automakers to obtain critical minerals for EV battery production.
Tesla’s deal with Magnis Energy
The binding offtake agreement commits Magnis Energy to supply Tesla with at least 17,500 tonnes of AAM annually, which is set to begin in February 2025. As per the agreement, the maximum supply would be 35,000 tonnes per annum for at least three years at a set price.
At the same time, Magnis aims to obtain a definitive location for its commercial AAM facility in the United States by June 30, 2023, and start producing AAM from a pilot plant by March 31, 2024.
The company expects to begin production and customer qualification in the commercial AAM facility by February 2025. Notably, Magnis has already begun placing orders for equipment and employing personnel for the pilot plant facilities for both Nachu Graphite concentrate and AAM.
Magnis Energy’s stock surged 12.35% to 45.5 cents at 10:40 am AEDT following the news. Partnering with Tesla is indeed a big deal for Magnis as the automaker can help fund its yet-to-be-identified US AAM facility.
