Company Profile – Vulcan Energy Resources
Having acquired 100% of Vulcan Energy Resources, owner of the Vulcan Lithium Project in Germany, Koppar Resources has changed its name to Vulcan Energy Resources to reflect its ownership of the groundbreaking Zero Carbon Lithium hydroxide product.
Vulcan Energy Resources announced in November that its leading German site had significant lithium reserves with 181 milligrams per litre. In 2021, it will conduct a complete feasibility study to scale up to the total commercial production of lithium in 2023-24. In October, Francis Wedin, Vulcan’s chief executive, told an industry conference that the Company’s resources are sufficient to provide a very substantial portion of the demand in the European markets.
A lithium plant in the Rhine Valley would have an advantage in supplying electric vehicle manufacturers because it is located in the heart of Germany’s automobile manufacturing region. Wedin noted that it also reduces the carbon emissions associated with transporting lithium overseas. In this respect, the Company plans to market its lithium as “zero carbon.”
Vulcan Energy and Geothermal Lithium
Currently, lithium is predominantly derived from hard rock mines in Australia or brine deposits beneath dry lake beds, for instance, in Chile and Argentina. However, this method of extraction has a significant environmental impact due to high carbon emissions and the use of water and land. The majority of open-pit mines leave substantial scars in the landscape and require a significant amount of water to maintain. It is estimated that 15 tons of carbon dioxide are released for every ton of lithium.
As a result, lithium extraction from geothermal waters has received considerable attention, and many companies are exploring the possibility in regions with high lithium content in geothermal waters. Comparatively to other methods, the method has a negligible environmental impact.
Geo-thermally generated brine is a hot, concentrated saline solution circulated through hot rocks in geothermal areas and enriched with minerals, such as lithium, boron, and potassium.
Goals and Vision
Vulcan Energy intends to decarbonize the transition to electric mobility through its Zero Carbon Lithium business for electric vehicle batteries and its renewable energy operations.
The project is supported by world-renowned experts in chemistry, engineering, and geology. Vulcan intends to produce the world’s first battery-quality lithium chemicals with zero carbon footprint, using renewable geothermal energy to drive lithium production without evaporation ponds or mining.
Europe is home to the fastest-growing market for lithium chemicals, with no local supply. Consequently, the Company will solve the EU’s lithium problems for the electric vehicle market. These problems include a very high carbon and water footprint of lithium production and total reliance on imported lithium.
In the Upper Rhine Valley of Germany, they will accomplish this using their geothermal and lithium brine resources. This is the largest lithium resource in Europe. Having access to such an extensive resource will enable us to supply Europe’s lithium needs for many years to come. As a result, this will allow Vulcan Energy to ensure a smooth transition to electric vehicles with minimal environmental impact.
Zero Carbon Lithium
Vulcan Resource Operation group is committed to decarbonizing the carbon footprint created by producing lithium-ion batteries for electric vehicles by producing a lithium hydroxide monohydrate chemical product with no carbon footprint from a geothermal lithium brine deposit in the Upper Rhine Valley, Germany.
The use of lithium chemicals in the production of batteries in electric vehicles is a critical component of their manufacturing. A large amount of lithium is required to electrify our cars with lithium-ion batteries fully.
The industry would have to emit approximately 1.05 billion tonnes of CO2 to produce the lithium needed to electrify all of the world’s passenger vehicles on the current main pathway.
Vulcan’s Zero Carbon LithiumTM business is different from current lithium extraction projects in that it causes no disruptions to communities or the environment. In other words, there should be no vast open-pit mines, no large, unsightly, and water-hungry evaporation ponds, and no fossil-fuelled plants.
Product Focus – Geothermal Brine
Finding Lithium and Boron in Geothermal Brine: In what part of the world can you find these precious geothermal waters? In this context, the Upper Rhine Valley along the Franco-German border, the Salton Sea in California, and Cornwall have the highest lithium content in geothermal waters and, therefore, the most attractive ones.
Vulcan Energy Resources is developing a combined geothermal-lithium project called Zero-Carbon-Lithium in the German-French context. With approximately $12,000 per ton, the lithium industry has excellent value.
Moreover, lithium production from geothermal resources could provide geothermal energy with a much-needed boost. Therefore, it is not surprising that investors are either following geothermal operations or planning to combine power generation and lithium production. EVulcan Energy Resources in Germany and Controlled Thermal Resources in the Salton Sea are two such companies being scrutinized by investors. The length of time it will take to produce lithium in industrial quantities from geothermal brine remains to be seen.
Market Focus – The EU
According to Forbes, more electric vehicles are sold in Europe than in China (ref. Aug 2020). Europe is the fastest-growing market for electric vehicles. To meet this demand, it is rapidly expanding its domestic lithium-ion battery production capacity, making it the fastest-growing lithium market globally.
- It is estimated that the European Union will need more than 1,000 kt of lithium hydroxide by 2030, more than twice the current global supply.
- Lithium hydroxide is not produced in Europe in a battery-quality form. Around 80% of the current supply comes from China.
- The Zero Carbon LithiumTM Project will reduce Vulcan’s almost complete reliance on batteries-grade lithium chemicals from China.
To the near future of Vulcan Energy Resource LTD, in the current dividend versus market and Industry sector, the Company has a 9.4% figure as an Average Industry growth. Out of 25% top Market, the Company holds 5.6% shares and 2.2% in bottom Top markets.
Investors are seeking companies in which they can invest their time and effort for the sake of sustainability as the Company sees decarbonized lithium products as crucial to powering the upcoming generations of Europe’s switch to the sustainable and compliant auto industry.
With decades of experience and expertise, the Company’s goal is to make the world a cleaner, brighter place. Vulcan’s market capitalization is close to $1.4 billion, and its share price on the trade market is $10.35.
Vulcan Energy Resources – Financials Summary 2021
|Fiscal year Ends||Jun 30, 2021|
|Most Recent Quarter||Jun 30, 2021|
|Return on Assets (ttm)||-9.20%|
|Return on Equity||-15.59%|
|Total cash per Share (mrq)||1.05|
|Total Debt (mrq)||558.94%|
|Total debt / Equity(mrq)||0.43|
|Book Value per Share (mrq)||1.19|
|Cash Flow Statement|
|Operating Cash Flow||-2.84M|
|Levered Cash Flow||-5.51M|
Vulcan Energy Resources – Stock Price History 2021
|Stock Price History|
|Beta (5Y monthly)||2.02|
|S&P500 52 Week Change³||25.73%|
|52 Week High³||16.65|
|52 Week Low³||2.51|
|50-Day Moving Average³||11.46|
|200-Day Moving Average³||10.12|
Source: Simply Wall Street