American leading automaker Tesla has reportedly sent a notice to Australian miner Core Lithium of probable legal action as the parties failed to reach a final deal on their 2022 supply agreement within the specified timeline.
Issue
Tesla and Core Lithium had a supply agreement last year for spodumene concentrate, Core Lithium, stated during an Equity Raise Presentation on Wednesday.
“Core has received a notification from Tesla of a potential legal claim relating to a binding Term Sheet entered between the parties on 1 March 2022, which formed the basis for negotiating the terms of an offtake agreement for the supply of lithium spodumene concentrate from Core’s Finniss Lithium Project.”
Core Lithium
The battery minerals will supposedly come from the company’s Finniss Lithium Project in the Northern Territory of Australia.
Core Lithium initially announced the potential partnership in 2022. It involves the supply of a maximum of 110,000 tons of spodumene concentrate to Tesla.
However, the companies were not able to strike a deal within the set deadline of October 26, 2022. That is unsurprising as the spodumene prices surged over threefold last year, Benchmark Mineral Intelligence’s data revealed.
As a result, Tesla now warns Core Lithium of its plans to “avail itself of all available legal remedies” if they fail to resolve the issue. Likewise, Core Lithium will also pursue such legal steps.
“…Tesla intends to avail itself of all available legal remedies to the extent the parties are unable to mutually resolve this matter without litigation. Should those efforts fail, each party intends to avail itself of all legal and equitable remedies.”
Core Lithium
See Also:
- Tesla lithium refinery project enters finals negotiations with Texas
- Tesla and other EV makers to source lithium from Exxon
- Tesla finally breaks ground at its new Lithium Refinery in Texas
- Tesla supplier LG Chem partners with Piedmont Lithium for 200,000 metric tons of spodumene concentrate
- Tesla is reportedly planning to bid for Sigma, boosting the lithium miner’s stocks
The wide adoption of electric vehicles worldwide significantly boosted the demand for lithium, a crucial mineral for battery production. Automakers have been striving to establish a solid and reliable supply chain to ensure the future of their business operation.
Tesla partnered with various suppliers, including Piedmont Lithium, to secure its supply of the critical mineral. Moreover, it has also established its own lithium refinery in Texas.
