Lithium and renewable energy producer Vulcan Energy Resources [ASX:VUL] has before expressed its goal to decarbonise the transition to electric mobility through its Zero Carbon Lithium project, producing lithium with a net-zero carbon footprint.
Today, it chose to update the market with an update on financing activities for Phase One of its Zero Carbon Lithium Project, based in in the Upper Rhine Valley, Germany, with a number of government backed ECAs.
These ECAs — Export Credit Agencies — have allegedly confirmed their support for the project and offer their capital. That is, subject to certain conditions.
The lithium explorer explains those funding avenues today, listing the relevant agencies, and yet investors were voting the VUL share price down 2.5% to $5.93 a share by early afternoon.
VUL has been sliding into the red over the past year, down 35%. It’s fallen 33% in its sector and more than 6% down so far in 2023:
Source: TradingView
Is Vulcan’s financing for Lithium Project sorted?
Earlier today, lithium and renewable energy pioneer Vulcan Energy gave insight into the monetary side of its decarbonisation goals, pushing ahead the zero-emissions production of lithium-ion batteries used in electric vehicles.
This is to be done by producing a world-first lithium hydroxide monohydrate chemical product through its Zero Carbon Lithium Project, a geothermal lithium brine project located in the Upper Rhine Valley, Germany.
The project will require plenty of financial support from interested parties and reliable investors if it is to see the full manifestation of its projected designs and expectations.
Today, the miner listed a number of funding avenues in a financial activity update for Phase One of the project.
Included in the highlights was the work of BNP Paribas, Vulcan’s debt financial advisor, who has approached a number of government backed ECAs and confirms support of project financing, subject to certain conditions.
Bpifrance Assurance Export, French ECA and subsidiary of Bpifrance, has also confirmed the eligibility of Vulcan’s project to their untied program Garantie des Projets Stratégiques thanks to Vulcan’s recent lithium offtake agreements with automakers Stellantis and Renault.
This program was designed by the French Government to support projects that have a national interest for the French economy in France and internationally.
More support was offered in Italy’s government ECA, SACE, and the Canadian ECA — Export Development Canada — who has also confirmed its interest in direct lending.
Feedback from further government funded ECA eligibility is expected in the coming months, with Vulcan and its advisors targeting completion of the debt and equity financing process in the first quarter of 2024.
Total CapEx for Phase One is estimated at 1.496B EUR and Vulcan is targeting a debt-to-equity ratio of 65:35%.
The group expects to provide an update on strategic equity investment opportunities, at a project level, in the near future.
‘Drill Baby Drill’ — it’s a mining boom
Speaking of tenements, projects, and prospects…
Some industries are making raging bull market-like gains regardless of recession fears, interest rates, and what the wider market does.
Compared to other industries, they’ve made some extreme gains, even last year while most other stocks were battered.
This can be described as an alternate universe, the universe of booming drillers.
It’s been described as a ‘new golden age’ for junior explorers who get in early.
Aussie mining is at its best right now, but who, where? If so many of them topped 2022, can they really do it again in 2023?
There are small caps primed to grow into mid-to-large caps, but how do you tell which ones?
It’s a big universe, and you may need a little help — that’s where our commodities expert James Cooper comes in.
He’s found six ASX mining stocks that are heading to top the charts for 2023.
Regards,
Mahlia Stewart,
For The Daily Reckoning Australia
