ioneer signs binding lithium offtake agreement with Ford.
ioneer Ltd (ioneer or the Company) (ASX: INR,NASDAQ: IONR), an emerging lithium–boron supplier, announce it has signed a binding offtake supply agreement with Ford Motor Company. Under the agreement, ioneer will supply Ford with lithium carbonate from its Rhyolite Ridge Lithium-Boron Project in Nevada.
Under the agreement, ioneer will deliver 7,000 tonnes per annum (tpa) of lithium carbonate to Ford over a 5-year term, starting in 2025. Ford intends to utilize ioneer’s lithium carbonate to produce batteries for use in Ford electric vehicles through BlueOval SK, the Ford-SK On battery manufacturing joint venture.
ioneer is expected to produce an annual average of approximately 20,600 tonnes of lithium carbonate/hydroxide along with approximately 174,400 tonnes of boric acid per year over the Rhyolite Ridge project’s 26-year lifei.
The dual production of lithium and boric acid allows ioneer to not only produce lithium in the U.S., but to do so at the bottom of the global cost curve. ioneer anticipates commencing production in the second half of 2025 to support urgent requirements for battery materials in the United States.
This agreement follows the earlier signing of an offtake agreementii representing approximately 34% of ioneer’s annual lithium carbonate production from Rhyolite Ridge in the first three years of operation.
James Calaway, ioneer’s Executive Chairman said:
The agreement with Ford is a significant milestone for ioneer, highlighting the mature state of the Rhyolite Ridge project development and its ideal position to serve the U.S. supply chain with domestic battery materials.
“Partnering with a recognised world-class automaker that exemplifies the spirit of American innovation is a testament to the quality of our lithium carbonate, and our commitment to the highest environmental standards and sustainability practices.”
Bernard Rowe, ioneer’s Managing Director, said:
Simply put, this strategic relationship means Nevada lithium for American cars, and it will lead to job creation across all levels of the electric vehicle supply chain.
“We look forward to continuing to work with Ford and its partners to help develop a secure and reliable end-to-end U.S. EV industry.”
Lisa Drake, Ford Model e vice president, EV Industrialization, said:
We look forward to developing this new relationship with ioneer.
“Helping unlock lithium in the U.S. will help us support localized production of battery cells going forward and, ultimately, support our efforts to deliver EVs for millions of customers.”
Key terms of the Agreement include:
- Product: Lithium carbonate.
- Contract Duration: 5 Years beginning when ioneer notifies Ford that the project has been fully completed and commissioned in accordance with the engineering, procurement and construction contract applicable to the project (anticipated in 2H 2025).
- Volume: 7,000 tpa.
- Price: Adjusted quarterly based on agreed market-based price formula.
- Currency: USD per metric ton.
- Conditions Precedent: ioneer’s Final Investment Decision anticipated by June of 2023 and no later than by December 2024, Ford’s approval of the final product specification on or before September 2022. Both conditions may be waived by the parties.
Highlights:
- ioneer has signed a binding offtake agreement with Ford to supply lithium from Rhyolite Ridge in Nevada intended to supply BlueOval SK.
- In support of end-to-end U.S. EV supply chain and Ford’s plan, ioneer is supplying lithium from its Nevada operations for lithium-ion batteries planned for EVs built in America.
- The 5-year binding agreement is for a total of 7,000 tpa of lithium carbonate from ioneer’s Rhyolite Ridge Lithium-Boron operation in Nevada and represents approximately 34% of annual output in the first 5 years of production.
ioneer Signs Binding Lithium Offtake Agreement with Ford, SYDNEY, July 21, 2022
