Ioneer inks offtake lithium deal with Nevada battery supplier Dragonfly Energy

Emerging lithium-boron supplier Ioneer (ASX: INR) has strengthened its US lithium and battery storage supply chain participation by gaining a new offtake partner, Reno-based Dragonfly Energy (NASDAQ: DFLI).

The agreement allows for supply over three years of a variable amount of lithium carbonate available after Ioneer meets its existing offtake agreements. 

Dragonfly Energy is described as an industry leader in energy storage and a leading supplier of deep-cycle lithium-ion batteries.

Ioneer, an emerging lithium-boron producer, has the Rhyolite Ridge project in Nevada which last month reported a 168% increase in its contained lithium carbonate resource for the South Basin deposit to 3.4 million tonnes.

Nevada has priority status on lithium 

Under governor Joe Lombardo, the Nevada state government has rated lithium production — and partnerships to strengthen the mineral’s supply chain — as a priority. 

In his recent state of the state address, Mr Lombardo repeated his support for closing the lithium loop to produce, utilise and recycle lithium.

And he is backing this latest partnership. 

“This agreement between Dragonfly Energy and Ioneer — and hopefully more like it in the future — are vital to our economy as we work to develop this new industry, secure Nevada’s energy independence and close the lithium loop,” the governor stated after the supply agreement was signed. 

Ioneer’s value to US supply chain 

Ioneer says that the agreement demonstrates the company’s tremendous value to the American supply chain. 

“Rhyolite Ridge is one of the most sophisticated undeveloped US lithium projects and one of the few in the world where lithium will be extracted and refined locally”. 

The company added that, once federal permitting and construction are completed, Rhyolite Ridge is expected to quadruple US lithium output. 

Expects to be lowest cost producer

Rhyolite Ridge lithium-boron project is the only known lithium-boron deposit in North America and one of only two known such deposits in the world.

The company has said previously it is expecting to be the lowest cost lithium producer in the world once its Nevada lithium-boron project in Nevada gets into production.

The mine is expected to come on stream in 2025.