Standard Lithium, a Germany-listed technology and lithium development company, has signed a Letter of Intent (LoI) with Koch Minerals and Trading (KM&T) to purchase lithium chemical off-take and procure critical raw materials.

The companies said the LoI aims to develop a market-based pricing mechanism for KM&T to procure lithium hydroxide produced by Standard Lithium at the South West Arkansas Project.

The South West Arkansas Project tests and proves the commercial viability of lithium extraction from 150,000 acres of permitted brine operations.

Robert Mintak, chief executive officer of Standard Lithium, said developing a market-based pricing off-take structure would allow KM&T to benefit from the "projected high prices for lithium chemicals in the coming decades and beyond".

"Additionally, the ability to leverage KM&T's substantial purchasing and commodity trading capabilities to optimize the price, quality and quantity of reagents required to operate the plants in the future, which is meaningful both for financing these projects as well as their successful operation" Mintak said.