Vulcan Energy Resources (ASX: VUL) has been upgraded to the next level of financing approval in the European Investment Bank (EIB)’s proposed involvement in the financing of Phase One of its Zero Carbon Lithium Project.
After preliminary due diligence, Vulcan’s Phase One Zero Carbon Lithium Project appears potentially suitable for an EIB financing and the Project has advanced to the "Under Appraisal" stage.
EIB's proposed financing could amount to up to A$825 million, pending completion of due diligence, credit approval and legal agreement, and subject to EIB's governing bodies approval. It is expected to serve as a cornerstone to complement ongoing debt funding discussions with leading export credit agencies and international banks.
Vulcan has already started its debt and project level equity financing process, supported by BNP Paribas, following positive market sounding in 2023 from commercial banks, development banks, and government-backed export credit agencies. This included a A$200 million non-binding Letter of Support from Export Finance Australia (EFA), and indication of strong ECA support from Canada, Italy, and France during 2023.
Vulcan is developing the world’s first integrated renewable energy and Zero Carbon Lithium Project in the Upper Rhine Valley, Germany, aiming to decarbonise the lithium supply chain for electric vehicles (EVs) and to supply local communities with renewable heat and power.
Phase One of Vulcan’s Zero Carbon Lithium Project (Project) is targeting the production of 24,000 tonnes per annum (tpa) of Lithium Hydroxide (LHM), equivalent to 500,000 Electric Vehicles. Vulcan will supply key auto and battery makers in the European supply chain, including its second-largest shareholder, Stellantis.