Lithium Australia's Exclusive Agreement with LG Energy Solution

Lithium Australia Ltd (ASX: $LIT) has announced that its subsidiary, Envirostream Australia Pty Ltd, has signed a new exclusive three-year recycling agreement with LG Energy Solution to recycle recalled lithium-ion batteries in Australia. LG Energy Solution is a leading battery manufacturer for electric vehicles (EV) and energy storage systems (ESS), holding a global market share of approximately 14% as of 2023.

Executive Commentary on the Agreement

We are very excited to announce this new Agreement signed with LG Energy Solution, a world leading battery manufacturer for EVs and ESS around the globe. The signing of this Agreement extends the already strong relationship with LG Energy Solution, who shares our vision for sustainable recycling of lithium-ion batteries. Our strategic roadmap identified the importance of signing long term agreements with tier 1 EV and ESS manufacturers. We see agreements of this type as key to moving our recycling operations to being cash flow positive and allowing us to grow our capabilities nationally. We are pleased that the first of these agreements is with LG Energy Solution and look forward to announcing further agreements with other tier 1 manufacturers.

Summary of the Exclusive Agreement

Lithium Australia's subsidiary, Envirostream, has secured a new exclusive three-year recycling agreement with LG Energy Solution, a major battery manufacturer for EVs and ESS. This agreement is expected to significantly increase Envirostream's large format lithium-ion battery (LIB) collection volumes, leading to greater recycling revenues. The company remains focused on accelerating growth in collection volumes of large format LIBs, such as those from EVs and ESS, due to their higher margin profile. With the projected growth in ESS and EV battery sales, there is an increased demand for battery recycling services, presenting a significant market opportunity for Envirostream. The company's strategy of signing exclusive contracts with leading battery manufacturers aligns with its national growth strategy, aiming to win new market leading clients.