Tesla has entered a binding offtake agreement with Magnis Energy Technologies, an Australian company that will supply the company with anode active material (AAM) for three years.
Magnis announced on Tuesday (via Sawyer Merritt) that it would begin supplying Tesla with a minimum of 17,500 tonnes per annum of AAM for a minimum term of three years at a fixed price.
Magnis is pleased to announce a signed offtake agreement with @Tesla for #graphite Active Anode Materialhttps://t.co/iPVQ5iGmRA#magnis #c4v #im3_ny #lithiumion #batteries #madeinamerica #cleanenergy #gigafactory #fastcharge #electricvehicles #EV $MNS $MNSEF pic.twitter.com/5tMKfPsN6O
— Magnis Energy Technologies (@magnisenergytec) February 20, 2023
The agreement is conditional, according to Magnis, on the term that the company secures a final location for its commercial AAM facility by June 30, 2023. A pilot plant must produce AAM by March 31, 2024, and commercial production must commence by February 1, 2025.
Tesla also has the option to double the amount of AAM described in the deal, potentially buying up to 35,000 tonnes per annum.
Active anode material is defined as either graphite or lithium alloyed metals and is suitable for electric vehicle battery applications. It has numerous benefits, including durability, it is lightweight, low cost, and excellent conductivity.
Magnis will supply Tesla with the AAM from a U.S. facility, which will eventually be built. The company said it is currently in the process of selecting a location for this plant but is developing a pilot facility for both Nachu (Tanzania) graphite concentrate and AAM has already started. Magnis has already started initiating equipment orders and has hired employees for the facility.
Magnis Chairman Frank Poullas commented on the deal with Tesla:
“We are really excited to bring our high-performing AAM to market that requires no chemical or thermal purification throughout the whole process, which differentiates this sustainable material in the market and provides great value to all parties.”
Tesla has signed supply deals with BHP Group, Piedmont Lithium, and others as it plans to secure critical minerals in the race to electrification. Syrah Technologies, which Tesla also has a supply deal with, is working to develop an AAM facility in Vidalia, Louisiana.
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