LG Energy Solution and Liontown Resources Enter Strategic Partnership for Long-Term Lithium Supply

LG Energy Solution and Liontown Resources Limited have entered into a strategic partnership aimed at fortifying their long-term collaboration in the global lithium sector. The partnership includes a convertible note subscription agreement, an extended offtake agreement for the supply of high-quality lithium spodumene, and a downstream collaboration agreement to explore the feasibility of establishing a lithium refinery. The partnership signifies a mutual commitment to advancing sustainable and stable lithium solutions globally and underscores the companies' shared commitment to innovation and value creation.

Key Takeaways:

• The partnership includes a 15-year offtake agreement, providing 700kt of spodumene concentrate over the first 5 years and 1,500kt over years 6 to 15, with an additional commitment to make up to 250kt spodumene concentrate available over the first 10 years.
• LG Energy Solution will invest $250 million through Convertible Notes to underpin the production ramp-up of Liontown's Kathleen Valley Project in Western Australia.
• The funding will also support the feasibility studies to establish an IRA-compliant lithium refinery, aiming to process spodumene from Kathleen Valley into battery-grade lithium chemicals.
• The partnership represents an extension of LG Energy Solution's existing offtake agreement by 10 years, securing a stable supply of critical minerals for the company.
• The agreement was formalized at a ceremony on July 4th at LG Energy Solution headquarters in Seoul, Korea.
• LG Energy Solution's CEO, David Kim, highlighted the partnership's importance in securing a stable supply of critical minerals, while Liontown Resources' Chairman, Tim Goyder, emphasized the partnership's significance in capturing the value of vertical integration and delivering substantial value to shareholders and stakeholders.

Statistics:

• The offtake agreement extends for 15 years, providing a stable supply of high-quality spodumene concentrate to LG Energy Solution.
• The agreement includes commitments to supply 700kt of spodumene concentrate over the first 5 years and 1,500kt over years 6 to 15.
• LG Energy Solution will invest $250 million (A$379 million) through Convertible Notes to support the production ramp-up of Liontown's Kathleen Valley Project.
• The funding will also support the feasibility studies to establish an IRA-compliant lithium refinery, aiming to process spodumene into battery-grade lithium chemicals.

Sources:

• LG Energy Solution
• LG Energy Solution (KRX: 373220)
• Liontown Resources Limited
• Contify.com