SQM and LG Energy Solution announced this week a new long-term purchase agreement to supply over 100,000 metric tons of battery-grade lithium carbonate and lithium hydroxide between 2023 and 2029.
The amount is enough for more than 2 million high-performance EVs.
The two companies also plan to expand their cooperation on lithium production and supply in North America and Asia.
The new contract replaces a previous agreement inked in 2020 for LG to procure 55,000 metric tons of lithium carbonate equivalent.
“Through this agreement, we have not only enhanced the supply stability of lithium, a critical mineral in batteries but also strengthened our ability to actively respond to the IRA (Inflation Reduction Act) by diversifying our supply chains,” LG Energy Chief Production & Procurement Officer Kim Myung-hwan said in a statement.
On Wednesday, NextStar Energy, the vehicle battery joint venture between Stellantis and LG Energy Solution, announced that construction will resume at its battery plant in Windsor, Ontario, with production operations planned to launch in 2024.
The plant aims to have an annual production capacity of over 45 gigawatt hours (GWh) and is one of eight battery plants that LG has secured in North America in response to its growing EV market.
Shares of SQM surged 4.4% by 11:33 a.m. EDT. The lithium producer has a market capitalization of $20.7 billion.
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