Vulcan Energy Resources has locked in a lithium hydroxide offtake agreement with Umicore for the Vulcan zero carbon lithium project in Germany.
The five-year offtake is set to begin commercial delivery in 2025 and will involve the purchase of a minimum 28,000 tonnes of lithium and a maximum 42,000 tonnes of battery-grade lithium hydroxide.
“Umicore, a leading cathode manufacturer and the first in Europe, will be a valuable offtake partner for Vulcan, as a direct consumer of Vulcan’s lithium hydroxide products,” Vulcan managing director Francis Wedin said.
“With our recent announcements of agreements with LG Energy Solution and Renault Group, we now have a diversified mix of offtakers from the cathode, battery and automotive sectors, with further agreements expected in the near term.”
Vulcan stated pricing under the offtake will be based on market prices through a take-or-pay basis.
The company’s project is set to become the world’s first lithium operation with net zero greenhouse gas emissions.
Vulcan is expecting to produce both renewable and geothermal energy, and lithium hydroxide from the Vulcan lithium project’s deep brine source.
It is aiming to supply lithium for the lithium-ion battery and electric vehicle market in Europe.
“In light of the accelerating transition to electromobility it is crucial to secure a reliable supply of critical raw materials, that is also environmentally and socially responsible,” Umicore chief executive officer Mathias Miedreich said.
“These long-term supply agreements mark another important step in Umicore’s sustainable procurement strategy and demonstrate our strong commitment to support the growth of our global customers through the creation of sustainable and regional battery materials value chains.”
The Vulcan zero carbon lithium project uses renewable energy to power lithium extraction while creating a renewable energy by-product.
The project’s pre-feasibility study has an after tax net present value of €2.25 billion ($3.51 billion).
Vulcan aims to produce around 40,000 tonnes per year of lithium hydroxide from 2025 after the first stage of commercial production at 15,000 tonnes of lithium hydroxide per year.