Liontown Resources has added flexibility to its partnership with Ford Motor Company, deferring its first loan payment to 2026 and halving the contracted spodumene volume from 2027 onwards.
After amendments to the debt facility agreement and the spodumene concentrate offtake agreement from the Kathleen Valley lithium operation, the first principal and interest payment due to Ford has moved from 30 September 2025 to 30 September 2026.
Likewise, the 512,500 dry metric tonnes (dmt) of spodumene concentrate to be delivered to Ford has been reduced to 256,250dmt, with no volumes to be delivered in the calendar years of 2027 and 2028.
According to Liontown managing director and chief executive officer (CEO) Tony Ottaviano, the original 2022 agreement was instrumental in financing and developing the Kathleen Valley.
“With production now underway, these amendments mark the next phase of our relationship,” he said.
“For Liontown, this agreement provides improved near-term balance sheet liquidity, retaining our debt facility with Ford, while giving (us) the strategic flexibility to sell greater volumes of spodumene concentrate via spot sales or to new strategic customers as the lithium market continues to evolve.”
Meanwhile, Liontown also added that the amendments provide Ford with a wider range of options over the reduced volumes and that it can elect to be released from its take-or-pay obligations over all the remaining volume.
The deal amendments comes after the recent release of Liontown’s 2024–25 financial year (FY25) results, where the company generated $298 million of revenue and underlying EBITDA of $55 million.
Ottaviano described FY26 as a transition year or a “tale of two halves”, with elevated unit costs as the company runs dual open pit and underground operations, and processed OSP (material containing between 10 per cent and 40 per cent host rock contaminant) material in the first half.
The deferral of the principal and interest payments to next year ensures Liontown has no large debt outflow during what Ottaviano described as FY26’s “transition” phase.
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