MELBOURNE (Reuters) - Australia's Kidman Resources has signed a preliminary deal to supply lithium hydroxide to LG Chem Ltd <051910.KS> of South Korea, Kidman said on Wednesday, as suppliers to the electric vehicle industry rush to secure raw materials for a boom in demand.
Kidman will supply 12,000 tonnes of lithium hydroxide a year to the diversified chemicals company for 10 years. A final deal is expected by July 31, the company said in a statement to the Australian bourse.
Australia is shaping up as a top supplier of lithium and other minerals for electric vehicle batteries and two major new lithium hydroxide plants are due to come on line next year. Much of Australia's near term supply has now been sewn up.
Kidman's strategy is to secure long term customers for 75 percent of its share of lithium hydroxide production from its Mount Holland project in Western Australia. Kidman said it has agreements with Tesla <TSLA.O> and Mitsui & Co Ltd <8031.T>.
The Mount Holland lithium project is being developed by Covalent Lithium, a 50-50 joint venture between Kidman and Chile's SQM <SQMa.SN>.
On Dec. 10, Kidman said it had settled a court dispute with private company Phoenix Rise and Jeffrey Hull, a retired geologist, over rights to develop the project.
(Reporting by Melanie Burton; editing by Grant McCool)
