In a major boost for Europe's green energy ambitions, Vulcan Energy Resources has secured a colossal funding deal to bring its flagship Lionheart lithium and renewable energy project to life. The Gina Rinehart-backed company has entered a trading halt to raise almost $1.1 billion as part of a near $4 billion financing package, green-lighting the first phase of construction in Germany.
A Landmark Project for Europe's Battery Supply Chain
Dual-listed Vulcan confirmed that construction is due to commence imminently, with engineering giants Sedgman and Hochtief now formally signed up to provide joint engineering, procurement and construction management services. The project, located in Germany's Upper Rhine Valley, represents a critical step in establishing a domestic and sustainable lithium supply chain for the European electric vehicle market.
The Lionheart development is designed to be a fully integrated operation. It will have the capacity to produce 24,000 tonnes of battery-quality lithium hydroxide monohydrate annually – enough lithium for approximately 500,000 electric vehicles each year. In a unique twist, it will also generate a significant 275 gigawatt hours of renewable power and 560 gigawatt hours of heat annually, which will be supplied to local consumers over the project's 30-year life.
The Financial Engine: A $1.08 Billion Equity Raising
The capital raising is a complex and substantial undertaking. The $1.08 billion equity raising, priced at €2.24 ($4) per share, comprises multiple components:
- A $245 million institutional placement.
- A one-for-1.128 accelerated non-renounceable institutional entitlement offer.
- A $366 million one-for-1.128 non-accelerated retail entitlement offer.
This equity component forms the cornerstone of the broader $3.93 billion financing package that has finally given Vulcan the certainty to proceed with the landmark development.
Redefining Sustainable Lithium Production
The construction phase will involve drilling geothermal-lithium brine production wells, building substations and pipelines, and establishing the renewable power and heat plant. Crucially, it will also include facilities to extract lithium from the brine and a separate plant to convert that material into the high-purity lithium hydroxide monohydrate required by global battery makers.
Vulcan has already de-risked the project's output, securing major offtake agreements for the first decade of production. These deals, totalling 222,000 tonnes, are with industry heavyweights including LG Energy Solutions, Umicore, automotive giant Stellantis, and Glencore.
Vulcan's chief executive, Cris Moreno, said the Lionheart project is poised to redefine lithium production. "It will deliver Europe's first fully domestic and sustainable lithium value chain," Mr Moreno stated. "It will also provide a clean and reliable source of renewable energy for local communities and industries in Germany's Upper Rhine Valley."
The advancement of the Lionheart project marks a significant moment for Vulcan Energy and its Australian backers, positioning the company as a central player in Europe's push for energy independence and a cleaner automotive future.
