(Reuters) -Core Lithium has received a notice from electric-vehicle maker Tesla over a 2022 supply agreement that failed to materialize within the set deadline, the Australian miner said.
The two companies failed to reach a deal by Oct. 26, 2022, as decided earlier, and now Tesla would take “all available legal remedies” unless the parties mutually resolve the matter, Core lithium said in a presentation on Wednesday.
The notice of a potential legal claim is related to a binding term sheet the companies signed in March last year to negotiate the terms of a supply agreement under which Elon Musk-led Tesla would have received spodumene, a lithium-rich mineral.
Tesla and Core Lithium did not respond to Reuters’ requests for comments.
The lithium producer was negotiating with Tesla to supply 110,000 tonnes of spodumene from its Finniss project in Australia’s Northern Territory.
Rising demand for electric vehicles around the world is encouraging automakers ranging from General Motors to Stellantis to Ford to step up efforts to secure raw materials needed for making batteries.
Ad: Save every day with Amazon Deals: Check out today's daily deals on Amazon.
Tesla in 2022 signed a five-year lithium-supply deal with Australia’s Liontown Resources to buy 100,000 dry metric tonnes (DMT) of the concentrate in the first year starting 2024, increasing to 150,000 DMT per year in subsequent years.
(Reporting by Sourasis Bose in Bengaluru; Editing by Shinjini Ganguli)