Core Lithium and Tesla enter into binding Term Sheet for the supply of lithium 

Core Lithium has entered into a legally binding Term Sheet with Tesla for the supply of up to 110,000 tonnes of Li2O spodumene concentrate from the Finniss Lithium Project over a term of 4 years, with pricing referenced to the market price for spodumene concentrate, subject to a price floor and ceiling (Term Sheet). 

This follows the Company's recent announcement that the Board has taken a Final Investment Decision to commence development of the Company's wholly owned Finniss Project, located near Darwin in the Northern Territory. The Company is fully funded to deliver the Finniss Project, which has started construction, through to first lithium concentrate production scheduled for Q4 2022.

The Term Sheet is subject to the parties completing negotiations and execution of a definitive product purchase agreement by 27 August 2022, which is to provide for a supply commencement date before 31 July 2023 (subject to extension by mutual agreement).

Core Lithium Managing Director Stephen Biggins said:

"The Term Sheet with Tesla is for the supply and delivery of up to 110,000 dry metric tonnes of spodumene concentrate over a term of 4 years. This adds to the previously announced binding offtake agreements with existing customers over 4 years.

“Subject to execution of a definitive agreement, Core’s supply to Tesla is scheduled to commence in 2H 2023 and will cease on the date that is 4 years after commencement of supply or until a total of up to 110,000 dry metric tonnes has been delivered.

“Core Lithium is thrilled to have reached this agreement with Tesla and look forward to further growing this relationship in the years to come. Tesla is a worldleader in electric vehicles and its investment in offtake and interest in our expansion plans for downstream processing are very encouraging.”

Exciting news for CXO shareholders, with the Core Board approving the Finniss Lithium Project. The annoucement is significant, as Finniss will be the first lithium mine in the Northern Territory.

Construction of the plant will begin in October and the first production of lithium concentrate is scheduled for the last quarter of 2022.

More on the announcement below:

Core Board approves Finniss Lithium Project FID - Australia’s Next Lithium Producer

Highlights

• The Board of Core has made the Final Investment Decision (FID) to proceed with construction of the Finniss Lithium Project in the Northern Territory
• Finniss’ development is fully funded
• Project execution to start immediately, with mobilisation and site establishment activities to commence during October 2021
• Commissioning of the DMS plant and first production of lithium concentrate scheduled for Q4 2022
• 250 jobs to be created during construction and operations
• Core uniquely placed on the ASX - as the only new Australian company forecast to start lithium production in 2022 - to take advantage of high lithium prices
   

Core Lithium’s Non-Executive Chairman Greg English said:

“This is a significant milestone, not just for Core, but also for the Northern Territory. We are delighted to be developing the Territory’s first lithium project, investing in the local economy and creating hundreds of new jobs on a project that will deliver lasting value for all Core stakeholders.

“It is a credit to Core’s management team, led by Managing Director Stephen Biggins, and the strong and positive support our Company has received from the NT Government that we can today announce the go-ahead for Finniss."

Stage 1 Definitive Feasibility Study Sets Scene for Australia's Next Lithium Producer

Highlights

• Stage 1 Finniss Lithium Project updated Definitive Feasibility Study (DFS) confirms that Core Lithium is well positioned to be the next lithium producer in Australia
• 30% increase in Ore Reserves to 7.4Mt @ 1.3% Li2O prepared using the JORC Code 2012, underpinning a 8-year Life of Mine (LOM), with additional Mineral Resource inventory to potentially further increase LOM
• Stage 1 mine plan comprises open pit production from Grants and Hang Gong and underground at Grants, BP33 and Carlton prospects
• High lithium grade and exceptional spodumene geo-metallurgy enable Core to produce high quality, coarse concentrate using simple DMS processing
• Excellent DFS economics reflected in Reserves-backed pre-tax IRR of 53% and pre-tax NPV8 of A$221 million and life-of-mine EBITDA of A$561 million from revenue of A$1.3 billion1
• Low initial capital expenditure of A$89 million (including pre-production mining costs) enables a 2-year payback and confirms Finniss as one of Australia’s lowest capital intensity lithium projects
• Life-of-mine average C1 Operating Cost (FOB) of US$364/t concentrate generate a robust average operating margin of more than US$370/t
• Further potential for Stage 2 production expansion and increases in Mineral Resources and Ore Reserves underway, with a substantial drilling budget for 2021 and 2022
• Completion of the DFS now paves the way for the Company to progress debt finance opportunities and finalise other customer and equity financing discussions
• Targeting FID for the start of Stage 1 construction, which is scheduled to commence before the end of 2021

$6m Modern Manufacturing Initiative Grant from Australian Federal Government

Highlights

• Core awarded $6 million Modern Manufacturing Initiative (MMI) Grant by the Australian Federal Government, with support from the Northern Territory Government
• With co-funding from the MMI Grant, Core will be assessing the potential feasibility of building a lithium hydroxideplant in Darwin
• Core is on track to commence construction of Australia’s next lithium mine at Finniss near Darwin before the end of this year