(Yicai Global) May 15 -- Jiangsu Zhihang New Energy will supply lithium nickel manganese cobalt oxide battery cells to a lithium-ion battery developer in China's eastern Jiangsu province.

The buyer will spend about CNY160 million (USD23.3 million) to buy at least 20 million units by year's end, a statement from Zhihang New Energy's parent said yesterday.

Zhihang New Energy has penned the framework contract with the state-held Yancheng State Development and Investment Corporation Zhongke New Energy Technology, according to the statement by Zhejiang Unifull Industrial Fibre, Zhihang New Energy's sole shareholder.

The state-backed company guarantees it will purchase at least 20 million 18650-2.6 ampere hour lithium nickel manganese cobalt oxide battery cells from Zhihang New Energy by the last day of this year, with the actual amount and price subject to purchase orders placed based on market conditions, per the statement.

The two parties will also sign a new framework supply contract each year to reconfirm the new annual supply quantity based on the supplier's delivery capability, the statement added.

The buyer, which designs, produces and sells new energy battery management systems, is building a lithium-ion battery plant with an annual capacity of 3 billion watt-hours, public information shows.

Editor: Ben Armour