Tesla aims to secure $1 billion a year in battery minerals from Australia

Tesla has confirmed through its chairwoman that the automaker is aiming to secure $1 billion a year in battery minerals, especially lithium and nickel, from Australia.

Robyn Denholm, Tesla’s chairwoman who also happens to be Australia, was attending a Minerals Council of Australia event today and commented on the automaker’s effort to secure resources in the country.

She confirmed that Tesla already sources three quarter of its lithium from Australia, and it plans to buy roughly $1 billion worth of minerals from the country every year (via Reuters):

“We expect our spend on Australian minerals to increase to more than $1 billion per annum for the next few years,”

She added about Australian mining companies:

“Australian mining companies do have a good reputation, great expertise, professionalism and are preferred by manufacturers increasingly concerned about meeting both today’s and the future’s ESG requirements,”

Tesla had previously secured an offtake agreement with Kidman Resources Limited to get lithium from its Mt. Holland lithium project in the Earl Grey deposit in Western Australia.

Furthermore, on top of supply agreements, Tesla also recently announced plans to mine lithium itself starting with claims on 10,000 acres that they acquired in Nevada.

CEO Elon Musk also added to Denholm’s comments about securing minerals in Australia:

“That’s where we get most of our lithium. Also, whereas phone batteries make heavy use of cobalt in cathode, Tesla uses primarily nickel, which is trickier, but has better energy density (range).”

Lately, Musk has been pushing for nickel producers to boost production as he expects the resource could become a bottleneck for battery production.

Yet, there have been fewer deals announced to secure nickel.

Tesla has been rumored to be working with Giga Metals, which is developing a nickel project in Canada.

The automaker has also been linked to a controversial nickel mine in New Caledonia and a potential battery project in nickel-rich Indonesia.

Tesla has also been moving more products to a LFP battery cell chemistry in order to free supply for its other electric vehicle programs, which are competing against themselves for battery cell supply on top of other EV automakers.