Vulcan to streamline geothermal lithium operations in Germany with acquisition

Source:ThinkGeoEnergy – Geothermal Energy News
Original URL:https://www.thinkgeoenergy.com/vulcan-to-streamline-geothermal-lithium-operations-in-germany-with-acquisition/

Vulcan Energy Resources Limited (Vulcan) has announced the conditional 100% acquisition of Geox GmbH (Geox), owner and operator of geothermal wells and related assets around the City of Landau in Germany. The assets of Geox are co-located within Vulcan’s Lithium Extraction Optimization Plant (LEOP), thus providing an opportunity for more efficient operations of Phase One of Vulcan’s Zero Carbon Lithium project.

“The acquisition of Geox finalises the streamlining of Vulcan’s upstream Phase One ownership. It will further derisk the Project, allowing for more efficient operations and improved decision-making during operational ramp-up and beyond,” said Managing Director and CEO Cris Moreno.

Geox is the owner and operator of geothermal wells and renewable energy generation assets in Landau, and also holds a geothermal and lithium license over the same area. The company is currently owned by IKAV Invest S.à.r.l (IKAV), an international asset management group focused on renewable energy and infrastructure projects.

Acquisition of the assets will allow for the streamlining and consolidation of the remaining upstream production assets of the Project into 100% Vulcan ownership and replaces an existing Joint Venture agreement and brine offtake agreement with Geox. As part of its wider Project construction, Vulcan intends to dismantle the current geothermal power plant at Geox, increase brine production from the licence area, and start supplying local consumers with renewable heating and power via its Geothermal and Lithium Extraction Plant (G-LEP) to be built in the local industrial park.

The deferred consideration, estimated at €15 million is part of, and conditional on, the Project capital expenditure being financed through the current Project-level debt and equity process.

Vulcan further announces that the updated Environmental and Social Impact Assessment (ESIA) has been published as part of the company’s Phase One financing with international lenders. This is a prerequisite to raising sustainable or green debt finance. Significantly, the ESIA states that the Project has no potential impact determined as greater than minor post mitigation measures and notes several positive impacts to both people and the planet.

Vulcan has also signed a €10 million loan agreement with global investment bank BNP Paribas to provide short-term flexibility prior to completion of the equity and debt financing of Phase One of the Project. The loan agreement, a revolving credit facility over a period of five years, is secured against Natürlich Insheim GmbH, which holds the Company’s Natürlich Insheim geothermal power plant. These loan funds are not intended to be used for the Geox acquisition.

Source: Email correspondence