Tesla inks five-year sales deal with Piedmont Lithium Limited

Piedmont project N. Carolina

Tesla (NASDAQ: TSLA) signed a five-year, fixed-price binding sales agreement with Piedmont Lithium Limited (NASDAQ: PLL). The companies have an option to extend the deal for another five years upon mutual agreement

The stock price of the Australian based mining company soared as much as 395% on Monday, driven by the announcement.

Piedmont to supply spodumene concentrate to Tesla

Under the agreement. Piedmont will supply spodumene concentrate (SC6) to Tesla from its North Carolina project, which is still under development.

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Spodumene is considered the most important lithium ore mineral derived from granitic pegmatite rocks. 

According to the Australian-based mining company, its agreement with Tesla represents approximately one-third its planned spodumene concentrate production of 160,000 tonnes annually. The electric vehicle manufacturer has the option to order additional quantity.

Piedmont’s North Carolina project needs more investment to reach full capacity production. That won’t be difficult now since it just obtained a supply agreement with Tesla.