After failing to tackle an alleged default of their graphite supply agreement for the second time in two months, Syrah Resources on Monday said that it had agreed with Tesla to extend the deadline.
Earlier in July, Tesla had issued a default notice to Syrah, following its alleged failure to deliver conforming active anode material samples from its Louisiana processing facility for Elon Musk-led electric vehicle batteries.
Under the offtake agreement, Syrah’s original deadline was 16 September, but then it was extended until 15 November. Now, it has been further extended to 16 January 2026.
Releasing an official statement, Syrah claimed it does not accept that it is in default under the agreement, so the parties have extended the cure date to 16 January 2026.
According to the 2021 contract, Syrah is supposed to supply 8,000 metric tons of graphite anode materials over a four-year period to Tesla. It is supposed to be supplied from Syrah’s Vidalia plant in the US state of Louisiana.
Syrah’s Vidalia plant is the only vertically integrated facility outside China, which helps reduce the US dependence on Chinese supplies.
What Syrah Said?
In the statement, Syrah clearly said that the Elon Musk-led electric car manufacturing firm can terminate the offtake agreement, in case the Australian firm fails to provide active anode material by 9 February 2026.
Among other things, Syrah also said that its subsidiary had received $8.5 million under its United States International Development Finance Corporation loan of $150 million. This would support its Balama graphite operations in Mozambique, which were hit in 2024 following nationwide protests.
What The 2021 Agreement Say?
In December 2021, Syrah Resources Ltd signed a four-year deal to supply graphite anode materials to electric carmaker Tesla from its US plant, based in Louisiana.
Tesla had signed the contract aiming to secure supplies of components used in making electric vehicles.
Under the contract, Tesla would buy the majority of graphite output from the Syrah facility in Vidalia.
As per the details, Graphite is used in the lithium-ion batteries that power electric vehicles.
Since 70 per cent of all graphite comes from China, and the United States is allegedly not capable of producing graphite to the required specifications needed for the lithium-ion batteries production, Tesla agreed to sign a contract with the Australian firm.Â
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