May 1 (Reuters) - Australia's Anson Resources ( ANSNF )

said on Wednesday it would supply 4,000 dry metric tons of

lithium carbonate per year from its Mexican Paradox Basin

project to South Korean battery giant LG Energy Solution

for an initial term of 5 years.

The commodity lithium has gained quite a traction over the

past few years in tandem with the global trend of transitioning

into green energy with the use of electric vehicles at the

forefront.

However, with diminishing demand of electric vehicles from

China - one of the world's largest EV market - the prices for

lithium, a key ingredient of EV batteries, have fallen quite a

lot in the last few months.

Last month, Mineral Resources, one of Australia's

top lithium producers, held onto its lithium production

expansion plans citing lower lithium prices.

The Paradox Lithium project, owned by the Anson Resources' ( ANSNF )

unit A1 Lithium, has a production capacity of about 10,000 tpa

of battery-grade Lithium Carbonate under phase 1.

The project, which is the company's lead asset, is powered

through hydro and solar energy and will be supplying U.S.-made

lithium to LG Energy.

Last week, LG Energy - a supplier of Tesla and

General Motors ( GM ), among others - had flagged concerns over

a sluggish EV demand and laid out its plans to cut its capital

expenditure for this year.