- Lake Resources (LKE) Signs Investment and Offtake Agreement with Korean Battery Producer SK On
- Under the conditional agreement, Lake will supply SK On with up to 25,000 tonnes of lithium per year from its Kachi project in Argentina
- SK On will also obtain a 10% stake in Lake through the issuance of new common shares
- Lake says the deal strengthens its long-term shareholder base and supports Kachi’s development, and SK On says the deal provides it with a stable lithium supplier for its US supply chain.
- Lake Resources shares are up 1.52% at $1.01 at 11:35 a.m. AEDT
Lake Resources (LKE) has reached an agreement with battery manufacturer SK On to extract up to 25,000 tonnes of lithium per year from its Kachi project in Argentina.
The contingent drawdown agreement is for five years with an option to extend for five years.
The deal will also see SK On take a 10% stake in Lake Resources through the issuance of new ordinary shares, which will be based on LKE’s volume-weighted average price over 20 trading days before October 12.
Lake executive chairman Stu Crow said the deal strengthens the company’s long-term shareholder base and adds to the equity component required for the development of the Kachi project.
“The Conditional Framework Agreement (CFA) provides a long-term strategic agreement with SK On, one of the world’s leading producers of lithium-ion batteries with a major growing presence in the North American market,” said Mr. Crow.
SK On vice president Jinsuk Ryu said the deal provides SK On with a stable lithium supplier for its U.S. supply chain.
“Lake is a particularly good fit with SK On’s ESG policy, as it uses environmentally friendly direct lithium mining technology for lithium production. With this CFA, both parties will strengthen their mutual partnership to advance opportunities to secure sustainable sources of raw materials in the future,” Ms. Ryu said.
The CFA is subject to Lake fulfilling certain conditions, including a definitive feasibility study, results from the Lilac demonstration plant, financial due diligence and product specifications.
Shares of Lake Resources rose 1.52% to $1.01 at 11:35 a.m. AEDT.