Lake Resources NL Reaches New High by Signing Non-Binding Memorandum of Understanding with Japanese Trader Hanwa Co Ltd for Lithium Carbonate Mining

“Lake and Hanwa view this MOU as the path to finalizing a binding long-term agreement with the ability to ramp up production and participate in Lake’s other projects to ensure high-quality lithium products with leading ESG benefits are available for Hanwa electric and electric vehicles. battery customers,” says LKE MD.

Lake Resources NL (ASX:LKE, OTCQB:LLKKF) hit a new share price record by signing a non-binding memorandum of understanding with Japanese trading firm Hanwa Co Ltd to negotiate the drawdown of up to 25,000 tonnes of lithium carbonate per year over 10 years at market prices.

The MoU also allows Hanwa to consider providing financial support mechanisms such as significant equity investment, possible prepayment on levies, and trade finance facilities to secure a long-term agreement and to build a lasting partnership with Lake.

This agreement has the potential to open up the Asian market for LKE, as Hanwa not only offers marketing and distribution services, but also helps coordinate a strategic and sustainable supply chain with potential customers in the battery industry. .

Shares rose 17.86% intraday to reach AU$1.98, a new all-time high, with over 39 million changes of hands as the company’s market capitalization is around $2.25 billion TO.

Advance the development of battery technology

“In April 2021, Hanwa formed the Battery Team to create multi-faceted business opportunities in the Electric Vehicle (EV) Battery and Accumulator industries,” said J Tomono, Hanwa Company Manager and Supervisor of the battery team.

“The market for lithium-ion batteries for electric vehicles is booming and we are handling the raw materials for these sophisticated products and increasing our involvement in all aspects of the supply chain.

“We searched for the right products, at scale, with the right partner, to advance the development of the latest battery technology and its cathodes.”

The two companies have agreed to negotiate in good faith, using all reasonable efforts, to formalize a comprehensive legally binding document to develop a “clean lithium” supply chain focused on meeting the environmental requirements of electric vehicle manufacturers. (VE) and their customers.

Hanwa will coordinate strategic partnerships between the two companies and downstream partners or customers, while Lake will provide samples and technical assistance, as well as exposure to its existing and potential partners.

Main environmental references

“The MoU reflects Hanwa’s intention to move quickly to finalize the terms of a strong, long-term and binding final agreement on the Levy, as well as enable financial support for Lake,” said Lake Resources chief executive Steve Promnitz.

“Lake and Hanwa view this MOU as the path to finalizing a binding long-term agreement with the ability to ramp up production and participate in Lake’s other projects to ensure high-quality lithium products with leading ESG benefits are available for Hanwa electric and electric vehicles. battery customers.

Lake Resources Chairman Stu Crow said finalizing a binding long-term agreement with Hanwa would strengthen Lake’s financial position as it heads towards a final investment decision later in the year.

“This MoU and the finalization of a binding off-take agreement with Hanwa will enable Lake to remain an independent supplier in global lithium supply chains and provide security of supply to the market and customers. potentials.

“Increase customer and consumer scrutiny around the environmental credentials of lithium production; and security of supply concerns gave us the confidence to enter into this partnership with Hanwa,” Crow said.

Lake has already received indications from export credit agencies in the UK and Canada that they are willing to offer debt financing covering around 70% of the Kachi project’s capital requirements.

Crow says the memorandum of understanding represented further support for Lake’s goals – dubbed the TARGET 100 program – of reaching 100,000 tonnes of high-purity lithium production per year by 2030.

The MoU and finalization of a binding long-term agreement with Hanwa will also provide access to project-scale batteries to supplement a solar farm power source at the Kachi project, as well as funding commercial at favorable rates for installation.

About Lake Resources

Lake Resources is a clean lithium developer using direct mining technology for the production of sustainable high purity lithium from its flagship Kachi project in Argentina’s lithium triangle, among other projects covering 220,000 hectares.

LKE’s Kachi project covers 705 square kilometers with an expandable resource of 4.4 million tons of lithium carbonate equivalent of which only 20% is used for 25 years of production at 25,500 tons per year.

The direct extraction method the company uses offers a solution to two growing demands for electric vehicle batteries: high-purity battery materials to avoid performance issues, and materials that are more sustainable and responsibly sourced.