Tesla Motors has signed an agreement with Pure Energy Minerals for the development of a lithium mine in Clayton Valley, Nevada.

Pure Energy Minerals is conducting a preliminary economic assessment to make sure that it can start mining at the site. If the assessment is positive, then as under the agreement, Tesla will purchase a specific amount of lithium at a predetermined price for five years.

Tesla will use the lithium hydroxide to manufacture batteries at its Gigafactory, which is located three and a half hours from the mine site, arstechnica reported, citing Reno Gazette Journal.