Rock Tech Lithium, Inc. (OTCQX: RCKTF) (TSXV: RCK) is engaged as a clean-tech company focused on developing high-quality lithium hydroxide for use in electric vehicle (EV) batteries. U.S.-listed shares of the lithium company popped 30% during trading on Thursday, October 20, 2022. Over the past thirty days, Rock Tech Lithium has seen average daily volume of 6,196 shares. However, volume of 55,272 shares or dollar volume of around $148,129, exchanged hands during the day’s trading.
Shares of Rock Tech Lithium rallied after the company announced that it has entered into a definitive supply agreement with Mercedes-Benz AG. The five-year agreement gives Rock Tech Lithium the right to supply Mercedes with 10,000 tons of battery-grade lithium hydroxide per year.
Based on the current market value for lithium hydroxide, management estimates the supply agreement to be worth C$2 billion over the five-year period. In addition, it represents over 40% of Rock Tech Lithium’s estimated annual production from its converter facility in Guben, Germany. The supply agreement is scheduled to launch after completing a qualification period in 2026 to confirm quality and sustainability objectives.
Mercedes-Benz says the 10,000 tons of lithium hydroxide annually is estimated to be enough to equip 150,000 Mercedes-Benz electric vehicles with high-performance batteries. The contract also requires that Rock Tech Lithium sources its raw materials from a mining site that has been audited by the Initiative for Responsible Mining Assurances (IRMA).
“Signing the Supply Agreement marks a significant milestone of our offtake strategy, and I am honored that Mercedes-Benz demonstrates trust in Rock Tech as a new but reliable player in a diversified European battery supply chain,” commented Rock Tech’s Chief Executive Officer, Markus Bruegmann at the signing event in Sindelfingen, Germany. “We are well aware of the significance of this relationship to both parties. We intend to focus our efforts on providing lithium hydroxide that will help to bring Mercedes-Benz’ electric mobility ambitions into action. This arrangement is a major step forward in our plans to directly contribute to clean mobility.”
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