Magnis Energy Technologies Ltd (ASX:MNS, OTCQX:MNSEF) has signed a binding offtake agreement with Tesla Inc (NASDAQ:TSLA) for the supply of active anode material (AAM) from MNS’s proposed US-based AAM production facility.
Magnis will supply a minimum of 17,500 tonnes of AAM per annum for a minimum term of three years, beginning in February 2025 at a fixed price.
The agreement also contains a provision for Tesla to raise the offtake amount up to 35,000 tonnes per annum.
Distinct market offering
“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,” Magnis Energy Technologies chair Frank Poullas said.
The agreement hinges on customer qualifications, as well as Magnis successfully securing a location for its AAM facility by June 30, 2023, producing AAM from a pilot plant by March 31, 2024, and beginning commercial production by February 1, 2025.
The company is currently selecting a location for the AAM facility, and has ordered equipment and hired new staff for the development of pilot plant facilities for both Nachu (Tanzania) graphite concentrate and AAM.
The technical aspects of the project have been developed over a seven-year period at facilities based in New York, with materials developed through environmentally sustainable processes that do not need any chemical or thermal purification.