Core Lithium share price dips despite Tesla extension

What's going on with Core Lithium?

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Key points

  • The Core Lithium share price is in the red today 
  • However, multiple ASX lithium shares are also falling  
  • Core Lithium has extended the date of termination on a binding offtake term sheet with Tesla 

The Core Lithium Ltd (ASX: CXO) share price is sliding today as negotiations with Tesla continue on a lithium deal.

Core Lithium shares are currently trading at $1.345, a 3.24% fall. For perspective, the S&P/ASX 200 Materials Index (ASX: XMJ) is down 2.23% today. Pilbara Minerals Ltd (ASX: PLS) shares are falling 2.25%, while the Allkem Ltd (ASX: AKE) share price is down 1.58%.

Let's take a look at what is going on with Core Lithium.

Offtake agreement termination date extended

Core Lithium announced today it has agreed with Tesla to extend the termination date on an offtake agreement to 26 October.

In March, Core Lithium announced it had entered a binding offtake term sheet for the supply of lithium to electric vehicle manufacturing giant, Tesla.

The deal involves Core Lithium supplying Tesla with up to 110,000 tonnes of spodumene concentrate over four years from the Finniss Lithium Project.

The plan is subject to the two companies entering a definitive product purchase agreement.

Previously, the final date for completion of negotiations was 27 August. However, with today's announcement, this has now been extended to October.

Commenting on today's news, Core Lithium said:

The extension allows Core and Tesla to complete negotiations for the definitive full form binding offtake agreement.

Core Lithium share price snapshot

The Core Lithium share price has exploded 320% in the past year, while it has gained 128% year to date.

However, in the past week, Core Lithium shares have lost nearly 4%.

Core Lithium has a market capitalisation of about $2.3 billion based on the current share price.

Motley Fool contributor Monica O'Shea has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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