Core Lithium, an Australian mining company, has received a warning from Tesla regarding a 2022 supply contract that didn’t come to fruition by the agreed deadline.
The two companies couldn’t finalize a deal by October 26, 2022. Consequently, Tesla has indicated they may pursue “all available legal remedies” if a mutual resolution isn’t reached, Core Lithium announced on Wednesday, according to Reuters.
The potential legal claim stems from a binding agreement the two companies entered in March of the previous year. This agreement laid the groundwork for the supply terms, wherein Tesla, led by Elon Musk, would acquire spodumene, a lithium-rich mineral essential for battery production.
Core Lithium had been in talks with Tesla to deliver 110,000 tonnes of spodumene from its Finniss project located in Australia’s Northern Territory.
This development highlights the urgency in the automobile industry, driven by the global surge in electric vehicle demand, to secure essential raw materials for battery production.
The news sent shares of Core Lithium down 24% on Thursday, down to $0.41 AUD.
