If all goes according to plan, the MVV deal could mark the first in a series of offtake deals, spurring the construction of several heat exchange plants supplying Germany’s industrial region. “Dozens of projects are possible,” suggests Wedin.
What the deal also marks, he adds, is another milestone for Vulcan’s broader aspirations in the Upper Rhine Valley: extracting lithium from brine before pumping it back into the ground.
As the deployment of electric vehicles (EVS) fuels dizzying increases in demand forecasts for metals such as lithium that are critical ingredients in lithium-ion batteries, the company aims to launch commercial production of lithium chemicals. quality battery from the same project to supply the booming European electric car market.
From 2024, Vulcan is targeting 40,000 tonnes of lithium hydroxide per year, enough for 1 million electric vehicles, and says lithium mining would be fueled by geothermal energy. Already, it has signed agreements to supply lithium to Volkswagen, Renault and Stellantis, the automotive giant resulting from the merger of Fiat Chrysler and the manufacturer Peugeot PSA.
As automakers seek to ensure their lithium comes from as sustainable a source as possible, Vulcan’s pitch is this: mining lithium from hard rock generates 15 tonnes of carbon dioxide per tonne of lithium produced, lithium brine in South America generates approximately 5 tons as well as a much higher amount of water consumption, whereas geothermal energy has a minimal environmental footprint. It even has the potential to be “net negative” in carbon dioxide terms by selling renewable heat and power back into the grid and displacing fossil fuels.
“We are fully sold for our first five or six years of lithium production from our start-up, which is scheduled for 2024,” says Wedin.
Yet great hurdles remain if Vulcan’s grand two-for-one vision for green lithium and renewable energy is to become a reality. For starters, the lithium mining side of the project is still in the pilot plant and feasibility study phase. Such an aggressive schedule aiming for a departure in 2024 could end up being too ambitious.
Last year, short-sellers J Capital publicly questioned Vulcan’s prospects of developing low-cost carbon-free lithium and predicted it would struggle to overcome Germany’s slow licensing processes. and community opposition. (Vulcan responded by initiating a lawsuit in Federal Court, leading to a settlement under which J Cap was barred from publishing further research on Vulcan and issued a public apology.)
But the challenges resource companies face in obtaining social license and permits are indeed real and growing. In Europe, this was pierced last year when Australian mining giant Rio Tinto had its Jadar lithium development project sensationally canceled by the Serbian government after months of protests over potential environmental damage.
While Vulcan sees a potential benefit for his project in the fact that geothermal technology does not require a landscape-scarring open pit mine or tailings dam and believes it has political support, Wedin acknowledges the risk of reasoned delays. by local concerns because “anything you build in a relatively populated area is going to have people for it and people against it”.
“Since we started, we’ve always pushed for fast turnarounds…but we have the expertise and the experience to make it happen,” says Wedin, who before Vulcan was a former gold mining geologist who continued to lead a young lithium explorer who made successful discoveries, notably in the Pilgangoora region of Western Australia.
“There is always a risk that you will be delayed due to local concerns or permissions – this is something we will have to manage.”
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