Green Technology Metals Ltd (ASX:GT1) has signed an offtake agreement to supply LG Energy Solution with 25% of all spodumene concentrate produced from the Seymour Lithium Project for five years.
The full-form offtake agreement follows the offtake term sheet and equity subscription agreement executed in May that saw LG Energy Solution invest $20 million and become Green Technology Metals’ second largest shareholder. LG Energy Solution is part of LG Group and is a global leader and innovator in EV battery manufacturing.
This is the first lithium offtake agreement to be secured in Ontario, creating a strategic alignment within the province's critical minerals supply chain.
The five-year term will commence once the company begins commercial production. If Green Technology Metals develops a lithium hydroxide conversion facility during that term, the company may deliver the equivalent lithium oxide content to LG Energy in the form of lithium hydroxide.
If the company develops and commences production from its Root, Wisa or Allison Lake projects before the Seymour Project, the offtake agreement will transfer and apply to whichever project that begins production first.
Under the agreement, the price received for the spodumene concentrate product will be determined with regard to the published market price of lithium hydroxide at the time.
Strategic location to supply North America
With the Seymour Project’s advanced stage of development, along with the Root Project’s growing size and potential and with the portfolio strategically located to supply the North American market, the company says it is receiving strong interest from tier-one parties across the lithium-ion supply chain and trading houses, seeking to secure potential near-term lithium supply.
Green Technology Metals CEO Luke Cox said, “We are pleased to have concluded negotiations with LG Energy Solution allowing us to execute our first full-form offtake agreement. LG Energy Solution is a global leader and innovator in EV battery manufacturing and having formalised arrangements for it to become a significant customer is a tremendous achievement.
“The agreement delivers strategic alignment within Ontario’s critical minerals supply chain and marks the first definitive lithium offtake agreement for Ontario.
"Importantly, it builds additional capabilities for GT1 as we advance our flagship Seymour Project and lithium chemical plant, in line with the company’s strategy to become the first lithium producer in Ontario with vertical integration.”