Electric car giant Tesla signs deal with Australian mining company

Tesla has signed a deal with an Australian mining company for the supply of battery materials.

Magnis Energy Technologies will source active-anode material for the electric vehicle giant from a proposed facility in the United States.

The binding off-take agreement with Tesla will comprise a three-year deal beginning February 2025, with a minimum of 17,500 tonnes per annum of anode-active material used to manufacture lithium-ion batteries.

As the deal is conditional, it must secure a final location by June 30, 2023, and begin pilot production by March 31, 2024. Tesla can also choose to double the amount of anode-active material, to 35,000 tonnes per annum.

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Tesla has previously inked deals with Australia’s own BHP, Syrah Resources, Liontown Resources and Piedmont Lithium to supply critical battery resources.

At last year’s electric vehicle summit in Canberra, the Australian chairwoman of Tesla, Robyn Denholm, said she’s “quite excited about this topic.”

“I actually think that electric vehicle battery technology is the biggest and best economic opportunity for Australia in a century,” she said.

“If you look at the bill of materials in terms of what goes into batteries, Australia has them all – and there aren't many other countries in the world that do. We also have a core competency in this area, which is in mining. So whether it's lithium or any of the different elements that go into a battery, we know how to do that.

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"[In 2021], Tesla bought a billion dollars worth of minerals. And 70 per cent of those came from Australia, but we sent them off-shore to be refined, and no value was added.

“A fraction of that comes back to Australia because of the way we’ve gone about the supply chain. What we need to do is to get the resolve to actually go up the food chain in terms of electric vehicles and batteries. We are very, very early in that whole cycle, but that supply chain will start to be locked in for the next decade and for after that pretty soon.”

Ford signed a non-binding off-take agreement with Lake Resources in early 2022, while Volkswagen and Stellantis have teamed up with German-Australian lithium supplier Vulcan in the past 18 months.

In addition, Australia and South Korea have signed a deal for co-operation on clean energy technology and critical materials for electric vehicles from brands including Hyundai, Kia and Ssangyong.

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Currently, the majority of steel used in Hyundai Motor Group vehicles is supplied from the Pilbara region in Western Australia.

“I was very pleased as well to hear about the [Federal] Government’s policy to actually look at battery technology as being an industry that we want to invest in as a country,” added Denholm.

“And it is not just up to Government, it needs to be public-private partnerships because we have the know-how, we have the technology, we just need the will to actually move forward. It is a very real opportunity for Australia to actually participate in that and become an energy power.”