Alkemy Capital Investments (LSE:ALK), the AIM-listed owner of Tees Valley Lithium (TVL), has signed a non-binding heads of terms with Canadian lithium developer E3 Lithium, establishing a framework for a proposed long-term refining partnership at TVL's planned UK refinery.
Under the arrangement, E3 would ship lithium carbonate from its Clearwater Project in Alberta to TVL's facility in the Billingham chemical cluster on Teesside, where it would be converted into battery-grade lithium hydroxide for supply to E3's customers in Europe.
The heads of terms covers up to 50,000 tonnes over an initial 10-year term and is explicitly non-binding.
TVL's CEO Vikki Jeckell described the deal as "another important step in demonstrating the demand for Tees Valley Lithium's independent merchant refining model," alongside its previously announced binding offtake with a Glencore subsidiary for up to 10,000 tonnes per annum.
E3's CEO Chris Doornbos said the framework "provides a potential pathway to serve hydroxide demand" while E3 continues to advance carbonate production from its Clearwater project, which carries a pre-tax NPV of USD 5.2 billion.
TVL is developing a £185 million merchant refinery targeting 25,000 tonnes per year of battery-grade lithium hydroxide, enough to support production of approximately 550,000 electric vehicles.
The partnership's progression to a binding agreement will depend on further commercial negotiations between the two parties.
