Vulcan Energy has marked significant milestones in its Phase One Lionheart Project, including drilling progress, a landmark heat supply deal, and a substantial lithium resource upgrade in Germany.
- Drilling commenced on fifth well at Schleidberg site near Landau
- 35-year renewable heat offtake agreement signed with EnergieSüdwest AG
- Building permits approved for 30MW geothermal plant and substation
- Lithium brine resource estimate for Mannheim licence increased by 76%
- Secured €104m in German government grants and progressed project financing
Operational Momentum in Germany
Vulcan Energy Resources (ASX – VUL) has accelerated its integrated lithium and geothermal energy project in the Upper Rhine Valley, Germany, with notable progress during the quarter ending June 2025. The company began drilling its fifth well at the Schleidberg site near Landau, marking the start of critical sub-surface works for the Phase One Lionheart Project. This step is pivotal in expanding Vulcan’s renewable energy and lithium production capabilities.
Alongside drilling, Vulcan secured a 35-year heat offtake agreement with EnergieSüdwest AG, a major German energy supplier. This contract commits Vulcan to supplying renewable geothermal heat to multiple districts around Landau, underpinning the project’s long-term commercial viability and integration into local energy infrastructure.
Infrastructure and Resource Expansion
Building permits were granted for a 30MW geothermal renewable energy plant and an electrical substation, enabling Vulcan to increase baseload renewable power production. This facility will support both grid sales and Vulcan’s own lithium production operations, reinforcing the company’s commitment to carbon-neutral processes.
In a strategic move, Vulcan completed the acquisition of Geox GmbH, adding operational geothermal wells, renewable energy assets, and lithium licences around Landau. This acquisition consolidates Vulcan’s upstream assets and strengthens its resource base.
Resource-wise, Vulcan announced a 76% increase in its lithium brine resource estimate for the Mannheim licence area, boosting the total lithium brine resource to over 3.2 million tonnes of lithium carbonate equivalent. Additionally, a maiden geothermal energy resource estimate was reported, highlighting significant recoverable energy potential. These upgrades position Vulcan as a leading player in Europe’s lithium and renewable energy sectors.
Financing and Strategic Partnerships
Vulcan is advancing its project financing, extending its conditional debt commitment letter with a syndicate of international banks until September 2025. The company is also engaging with the €1 billion German Raw Materials Fund, securing government participation to support its ambitious development plans.
Complementing financing efforts, Vulcan completed a €30 million strategic placement, notably supported by BNP Paribas’ Clean Energy Solutions Fund, reflecting strong investor confidence in Vulcan’s low-carbon lithium and geothermal project. The company is also in advanced negotiations for a lithium hydroxide offtake agreement with a premium German automaker, aiming to secure long-term sales aligned with its production timeline.
Sustainability and Community Engagement
Vulcan’s sustainability credentials were recognised with top honours in The Australian Financial Review’s Sustainability Leaders 2025 awards, underscoring its leadership in decarbonising battery supply chains. The company maintained a strong focus on health and safety, despite reporting a single lost time injury during the quarter, and actively engaged local communities through open days and consultation initiatives.
Looking ahead, Vulcan is progressing studies for future project phases, including the Mannheim licence scoping study and seismic surveys near Ludwigshafen, in partnership with BASF. These efforts aim to expand geothermal heat supply and lithium production capacity, further embedding Vulcan’s role in Europe’s energy transition.
Bottom Line?
With financing and offtake agreements on the horizon, Vulcan’s integrated lithium and geothermal project is poised for transformative growth in Europe’s clean energy landscape.
Questions in the middle?
- Will Vulcan finalise its lithium offtake agreement with the premium German automaker by mid-year?
- How will the inclusion of the German Raw Materials Fund impact Vulcan’s project financing terms and timeline?
- What are the potential operational risks following the recent lost time injury at the Schleidberg well site?