Global Lithium Resources (GL1) continues to de-risk its business model after signing a non-binding memorandum of understanding (MoU) with leading Korean battery manufacturer SK On (SKO).
The two companies will explore the viability of downstream integrated lithium assets for an initial two-year period.
The MoU will also consider the potential for SKO to support future Global Lithium capital raisings to enable business expansion and development, as well as potential investment and offtake opportunities for Global Lithium’s Marble Bar and Manna lithium projects in Western Australia.
SKO is one of the fastest-growing battery manufacturers in the industry, supplying batteries to the likes of electric vehicle (EV) manufacturers, Ford Motor Company, Hyundai Motor Company and Volkswagen.
The company has battery production facilities in the US, China, Hungary and Korea.
The term of the MoU is two years unless it is extended or terminated earlier by mutual agreement or superseded by a definitive agreement related to a joint venture, partnership and/or offtake agreement.
Global Lithium managing director Ron Mitchell said the SKO partnership was a significant milestone for the emerging miner.
“Evaluating downstream processing partnerships is a significant part of GL1’s step-change growth strategy and the company will continue to build on a range of advanced discussions around the globe,” Mitchell said.
“The lithium and EV markets have experienced significant growth over the past two years and this expansion is only set to accelerate as demand for lithium-ion batteries increases.
“A partnership such as this will help position Global Lithium to be a key supplier of lithium to aid the continued sustainable development of the industry.”
SKO vice president Jinsuk Ryu echoed Mitchell’s sentiment, highlighting the importance of lithium producers for its own battery manufacturing aspirations.
Global Lithium was trading at $2.30 at close on September 29, with a market capitalisation of $365 million. Its share price has risen almost 500 per cent in the last 12 months.