Asian Tech Press (Jan 12) -- South Korean battery maker LG Energy Solution (LGES) has signed an agreement to buy a total of 700,000 dry metric tonnes (DMT) of lithium spodumene concentrate from Australia to secure supplies of battery feedstock for electric vehicles.

A press release issued Wednesday by Australian lithium miner Liontown Resources Limited (ASX: LTR) shows that the offtake agreement is for a five-year term, expected to begin in 2024 and can be extended for another five years after expiration.

Under the agreement, LGES will purchase 100,000 dry metric tonnes (DMT) of lithium spodumene concentrate from Liontown's flagship Kathleen Valley Lithium Project in Western Australia in the first year, increasing to 150,000 DMT per year in subsequent years.

Liontown stressed that the agreement with LGES is a milestone because LGES is "one of the world's premier battery manufacturers", with customers such as Tesla Inc. and General Motors Corp.

Lithium spodumene concentrate is a mineral that contains lithium, a key raw material for electric car batteries. And the 700,000 DMT of the material will enable LGES to make batteries that can power 2.5 million electric vehicles for running more than 500 kilometers on a single charge, the Maeil Business Newspaper reported.

According to Seoul-based market tracker SNE Research, LGES is the world's second-largest battery manufacturer after Chinese battery maker CATL. The South Korean company had a 22% market share in the 11 months ending November 2021, compared with CATL's 29%.

LGES executives held an online press conference on Monday, where LG vice chairman and LGES CEO Kwon Young-soo said, "We overwhelm the competitor in IPs, and we have more diverse clients in the U.S. and Europe, and production bases there to supply our products to those clients, which CATL doesn't have."

"Since we have more orders, we predict that we will be higher than CATL in terms of market share in the future," Kwon added.