European Lithium receives first offer from BMW
European Lithium (EUR), an Australian registered company, announced on Wednesday that BMW will be the first buyer of lithium hydroxide at its Wolfsberg plant in Austria.
A six-year binding supply agreement signed through an Austrian subsidiary company ECM Lithium, covers 50,000 tons of lithium hydroxide. Deliveries are due to start in 2026 with a volume of 5,000 tons in the first year. The supply will then increase to around 9,000t until 2031, after which the parties may extend the purchase for another three years.
BMW will make a $15 million down payment, which will be settled in equal offsets with the supply of lithium hydroxide to the automaker . Pricing will be based on discounted reference spot prices.
EUR says securing its first sale is a key milestone that allows it to focus on the final stages of Wolfsberg's supply as it looks to the future and creates a portfolio of promising battery metal manufacturing projects located in Europe.
According to the companies' initial announcement in August, BMW has the right to first purchase 100% lithium hydroxide produced from identified resources in Wolfsberg. According to the preliminary feasibility study in 2018, the project can provide an annual production of 10,129 tons of lithium hydroxide with a mine life of more than 10 years. Mineral resources are estimated at 10.98 Mt at 1% lithium oxide.
EUR is expected to publish its final feasibility study before the end of the year. Initially, the production of the first hydroxide was planned for the first quarter of 2025.