Company announces deal to provide Tesla with Nevada-mined lithium

Vancouver-based Pure Energy Minerals said the agreement is contingent upon a forthcoming study to confirm that the project in Clayton Valley southwest of Tonopah is technically and economically viable.

The company hopes to complete a preliminary economic assessment in the second quarter of 2016.

“This agreement with Tesla is a significant milestone that validates Pure Energy’s lithium project and business development model, and is an important step in the development of the project,” Pure Energy CEO Robert Mintak said in a statement.

The company in July estimated possible reserves of 816,000 metric tons of lithium carbonate equivalent within the project area.

Pure Energy’s release added that its ability to satisfy terms of the agreement with Tesla is also dependent upon obtaining financing to complete the development, including building mine processing facilities.

The project is in the same basin as Silver Peak lithium brine mine owned by Albemarle Corp., a Louisiana-based chemical company. Silver Peak is currently the only lithium producing operation in the United States.

Tesla is looking for suppliers of lithium, a light metal used in lithium-ion batteries. Tesla, in partnership with Panasonic, is building a $5 billion factory in Northern Nevada to make batteries for Tesla’s electric cars, as well as stationary energy storage units.

The batteries are a key factor in Tesla’s plan to mass market its electric cars and make them more affordable.

In August, Tesla signed an agreement with operators of a lithium mine in northern Mexico.

That arrangement with Sonora Lithium Project Partners also contains several conditions, including ability to obtain financing, meet performance timelines and pass product specification qualifications.

Contact Sandra Chereb at schereb@reviewjournal.com or 775-687-3901. Find her on Twitter: @SandraChereb