Tesla Secures Lithium Supply for Battery Factory
August 28 2015 - 9:50AM
Dow Jones News
Tesla Motors Inc. has secured a North American supply of lithium
hydroxide through a long-term contract with mining company Bacanora
Minerals Ltd. and Rare Earth Minerals PLC, giving the electric car
maker a key base material used to produce lithium-ion batteries
used its electric vehicles.
Tesla is building a $5 billion battery factory in Nevada that
aims to reduce battery costs by 30% or more, partly by bringing in
in-house materials suppliers. The agreement with the two companies
gives Tesla access to below-market-rate lithium in exchange for
minimum purchase amounts over a five-year period, according to a
statement.
The first phase of the battery factory, under construction near
Reno, is expected to be completed next year. When the battery
factory is fully built out, it will be capable of making 35
gigawatt-hours of battery cells, which is more than all of the
current lithium-ion battery plants in the world today combined.
The two companies in partnership with Tesla have rights to land
in northern Mexico, where lithium can be obtained from mineral-rich
clay, according to the release. The two companies are calling
themselves the "Sonora Lithium Project Partners."
The mine and processing facility are expected to have an initial
capacity of 35,000 tons of lithium compounds and could be expanded
to 50,000 tons.
Most of the world's supply of lithium comes from South America.
While a key component of the battery, other materials like copper,
nickel and graphite make up more of the actual material in most
lithium-ion batteries.
Write to Mike Ramsey at michael.ramsey@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
August 28, 2015 09:35 ET (13:35 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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