Shares in Toyota Tsusho, owned 21.8 percent by Toyota, jumped about 10 percent after the sister firm announced a deal to jointly develop a new lithium project in Argentina with the project's owner and operator, Australian-listed Orocobre Ltd .
Lithium is used to make batteries and is expected to be in increasing demand as car-makers such as Toyota and Honda Motors ramp up production of fuel-electric hybrid vehicles.
'As environmentally friendly electric car demand continues to grow, Toyota Motor Corp will have the opportunity to become a cornerstone offtake customer,' Orocobre said in a statement.
The Salar de Olaroz project is estimated to cost around $80- $100 million, with the final figure to be determined after a feasibility study, Orocobre spokesman Paul Ryan said, adding the study should be complete by end-September.
'In addition, Toyota Tsusho will also have the opportunity to negotiate a lithium chemicals off-take agreement with Orocobre as part of the joint venture,' Orocobre Managing Director Richard Seville said in a press release.
Toyota aims to double its global output of gas-electric hybrid cars to 1 million units in 2011, as it fights to stay in the lead in the growing market for low-emission cars, the Nikkei business reported this month.
Subject to the finalisation of the terms, Toyota Tsusho will acquire a 25 percent equity interest in the joint venture while Orocobre will continue to own the remaining 75 percent of the project and will operate the venture.
(Reporting by Eriko Amaha, editing by Mark Bendeich) Keywords: TOYOTA LITHIUM/ (eriko.amaha@thomsonreuters.com; +612 9373 1818; Reuters Messaging eriko.amaha.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
© 2010 AFX News