SK On, one of South Korea's three major battery manufacturers, announced on Thursday that it has reached a significant agreement with a US company to provide advanced energy storage systems (ESS) with a total capacity of up to 7.2 gigawatt-hours (GWh).

According to SK On, under this agreement, the company will begin supplying containerized ESS units equipped with 1 GWh lithium iron phosphate (LFP) batteries to Flatiron Energy Development starting from the second half of 2026.

SK On has also secured the first bidding rights for the Flatiron project, which is expected to continue until 2030 with an estimated capacity of 6.2 GWh.

While the company did not provide further details such as the contract value, market observers estimate the deal is worth approximately 2 trillion Korean won ($1.43 billion).

SK On stated, "This highlights SK On's strategic expansion into the US BESS market while demonstrating growth in the LFP battery sector, underscoring SK On's commitment to product portfolio diversification and sustainable growth."

Flatiron is a utility-scale energy storage developer based in Colorado, USA.

SK On also announced that it will begin mass production of LFP batteries starting from the second half of next year.