Ford Signs Deal to Buy Lithium From U.S. Mine

Written By Luke Burgess

Posted July 27, 2022

Last week, Ford announced several plans to source new EV batteries and related minerals, including lithium and nickel, to support the company’s goal of achieving annual production of 600,000 electric vehicles by next year and over 2 million by 2026.

The company announced Chinese battery maker Contemporary Amperex Technology Co. Ltd. (SHE: 300750) will supply lithium-iron-phosphate batteries for new Mustang Mach-E models next year and F-150 Lightnings by 2024.


Ford also said that LG Energy Solution (KRX: 373220) and SK Innovation (KRX: 096770) subsidiary SK On have increased production capacity, which will support increased production of nickel-cobalt-manganese batteries.

And it didn’t stop there.

The company also announced it was working with multiple mining companies to source nickel and lithium needed to produce the new EV batteries. Ford said it has signed nonbinding memorandums of understanding (MOUs) with:

  • Vale (NYSE: VALE) subsidiaries Vale Canada Ltd. (“to explore potential opportunities across the EV value chain”) and PT Vale Indonesia (to create a three-party relationship in Indonesia to process nickel ore)
  • Huayou Cobalt (SHA: 603799) for an offtake agreement that will supply Ford with 84 kilotons of nickel per year
  • BHP Group (NYSE: BHP) for nickel supply from Australia
  • Rio Tinto (OTCMKTS: RTNTF) to secure a “significant” offtake agreement for lithium from Argentina
  • Compass Minerals (NYSE: CMP) for lithium hydroxide and lithium carbonate from its Utah operations on the Great Salt Lake
  • Syrah Resources (OTCMKTS: SYAAF) and SK On for offtake of natural graphite from Louisiana

But there was one agreement that received more attention from the announcement than the others — and that was a binding offtake agreement with a little-known company called ioneer (ASX: INR) or (OTC: GSCCF).

Ford’s press release simply says the company “has signed a binding offtake agreement with Ford for lithium carbonate from ioneer’s Rhyolite Ridge project in Nevada to support EV production beyond 2025.”

Ioneer’s press release goes into a little more detail, saying the company will supply Ford with 7,000 tonnes of lithium carbonate per year over a five-year period beginning in 2025.

Of all the agreements with mining companies, Ford’s deal with ioneer stands out. Several articles have been written about the deal, and it’s the focus of much talk on social media.

One of the main reasons ioneer is getting most of the attention is because it’s the only binding agreement of the bunch. The others are nonbinding.

A July 21st Reuters article pointed out that “the deal is one of the first binding agreements between a U.S. lithium company and [a] U.S. automaker amid rising pressure from Washington to domestically source metals for the green energy transition and curb reliance on China.”

But there’s also this…


This is Eriogonum tiehmii, commonly known as Tiehm's buckwheat.

Never heard of it? Well, that’s no surprise because it's an extremely rare plant that’s only known to exist in one small area in far Western Nevada.

According to Allison Melton, a staff attorney at the Center for Biological Diversity, the Tiehm's buckwheat's habitat is restricted to a total of 10 acres spread across two miles in Western Nevada — and it’s right on top on ioneer’s Rhyolite Ridge project.

The Center for Biological Diversity has been fighting with ioneer to protect the Tiehm's buckwheat since 2019 after a whistleblower from the Bureau of Land Management told the center about mineral exploration near the flower’s habitat.

The Reuters article briefly mentions Tiehm's buckwheat, saying:

The Center for Biological Diversity, an environmental group, said Ford "needs to rethink this poor decision" to partner with ioneer and should source the metal elsewhere because of concerns about the flower's fate.

Patrick Donnelly, Great Basin director at the Center for Biological Diversity, tweeted the following:


What’s so important about this Tiehm's buckwheat?

I honestly don’t know.

I was unable to find any practical uses for the plant, and all questions directed to the Center for Biological Diversity regarding why Tiehm's buckwheat is an important species that should be saved have been ignored. The only thing I can guess is the Center for Biological Diversity is so adamant about protecting this (apparently) useless plant simply because that’s its mandate. I mean, “biological diversity” is right in its name.

There are currently plans to zone off more than 900 acres near the proposed mine site to protect the Tiehm's buckwheat. But it’s very likely that groups like the Center for Biological Diversity will continue to fight off mining at Rhyolite Ridge. So there’s still a chance no one is getting the area’s lithium, binding agreement or not.

But I think we have to make a choice…

Do we want to mine important EV minerals from the largest known lithium deposit in North America? This is expected to:

  • Employ 250–300 people during operations with median total salary levels of over $140,000 per year
  • Have an economic impact worth more than half a billion dollars
  • Reduce America's dependence on foreign countries that have little to no environmental regulations

Or do we want to save this seemingly useless plant?

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