Westwater Resources Inc (NYSE-A:WWR) has inked its inaugural off-take agreement with SK On Co., Ltd., a leading South Korean electric vehicle (EV) battery manufacturer with major clients including Ford, Hyundai, and Volkswagen.
The off-take agreement marks a significant milestone for the US graphite company and solidifies the supply of CSPG-10 natural graphite anode products from the Kellyton graphite plant in Alabama to SK On's battery plants in the US.
According to the terms outlined in the agreement, SK On commits to procuring a specified quantity of the graphite anode product annually, calculated as a percentage of the forecasted volume required by SK On, with the flexibility to adjust the minimum purchase amount through mutual agreement.
In the final year of the off-take agreement, SK On anticipates a substantial requirement of 10,000 metric tonnes of the product, according to Westwater.
Terence Cryan, executive chairman of Westwater Resources, called the contract with SK On “another important step in advancing Westwater’s graphite business.”
“We are excited to partner with a leading global manufacturer of EV batteries and assist SK On to further establish its US-based supply chain,” Cryan said in a statement.
The executive highlighted the contract's crucial role in securing additional financing for the completion of Phase I of the Kellyton graphite plant, currently under construction in east-central Alabama.
Westwater CEO Frank Bakker noted that it is the first off-take agreement for Westwater. The company is “actively negotiating additional off-take agreements with other customers,” he added.
Westwater Resources aims to position itself as one of the premier US-based suppliers of natural purified graphite, aligning with the growing demand from companies seeking an IRA-compliant source by 2025.
In addition to the Kellyton plant, Westwater owns the Coosa graphite deposit, located across 41,965 acres in Coosa County, Alabama.