The world’s leading lithium-ion battery manufacturer LG Energy Solution on Tuesday signed a non-binding agreement with Australian mineral firm Infinity Lithium to source lithium hydroxide, a key material for high-nickel electric vehicle batteries.

Under the agreement, LGES gains priority access to 10,000 metric tons of lithium hydroxide each year from Infinity’s San Jose lithium project in Spain for an initial five years. LGES also has the option to offtake additional volumes for five more years through further negotiations with Infinity. The purchase price will be based on market price of the product.

“Ten thousand tons of lithium is enough to make batteries for about 300,000 EVs,” an LGES official said.

The parties have agreed to consult in good faith towards finalizing the agreement within 12 months.

A formal agreement relies on Infinity resolving permit issues at San Jose, where its permit was cancelled by a governing body last month. Also, Infinity will have to prove it can create lithium hydroxide that meets LGES’ requirements.