(Corrects first paragraph to say Anson's Paradox Basin project is in Utah, not Mexico)

May 1 (Reuters) - Australia's Anson Resources said on Wednesday it would supply 4,000 dry metric tons of lithium carbonate per year from its Paradox Basin project in Utah 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' 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, among others - had flagged concerns over a sluggish EV demand and laid out its plans to cut its capital expenditure for this year.

(Reporting by Rajasik Mukherjee; Editing by Tasim Zahid and Rashmi Aich)