LONDON (ShareCast) - (ShareCast News) - Rare Earth Minerals and Bacanora Minerals have signed a deal with electric sports car and energy storage products company Tesla Motors.
Under the deal, the US-based group will buy lithium hydroxide from the Sonora lithium project in Northern Mexico to feed the batteries of its Gigafactory in Nevada.

Bacanora and Rare, however, said the deal was subject to the Sonora project reaching certain performances milestones over the next two years, including that the project can supply lithium hydroxide within the volumes and timeframes Tesla will indicate.

The deal will run for five years, starting from the US group's first order, with the option to be extended for a further five years.

"The selection of the Sonora lithium project as one of the lithium suppliers to the Tesla Gigafactory is a landmark transaction that will support the development and commercialisation of the Sonora lithium project," said Rare Earth chairman David Lenigas.

"This key supply agreement with Tesla will hopefully be the first of a number of potential lithium off-take partners for the Sonora lithium project as we move towards the next stages of project development."

As of 1015 BST on Friday, Rare Earth shares were up 16.56% to 1.05p, while Bacanora shares were up 21.79% to 85.25p.

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