How Vulcan’s Glencore Deal Unlocks Europe’s Lithium Future
Vulcan Energy has locked in a binding lithium hydroxide supply agreement with Glencore, completing the key offtake contracts needed to finance its Phase One Lionheart Project. This milestone positions Vulcan to advance construction and meet growing European EV battery demand.
- Binding offtake agreement with Glencore for 36,000–44,000 tonnes over eight years
- Final contract required for Phase One Lionheart Project financing
- Project targets 24,000 tonnes lithium hydroxide annually, powering ~500,000 EVs
- Glencore joins Stellantis, Umicore, and LG Energy Solution as offtake partners
- Construction to begin after financing finalization in Q4 2025, production in 2028
Strategic Partnership Secured
Vulcan Energy Resources has announced a binding lithium hydroxide monohydrate (LHM) offtake agreement with a wholly owned subsidiary of Glencore plc, one of the world’s largest natural resource companies. This deal marks the final offtake agreement necessary to secure financing for Vulcan’s Phase One Lionheart Project, a flagship initiative aiming to produce 24,000 tonnes of battery-quality lithium hydroxide annually.
The agreement commits Glencore to purchase between 36,000 and 44,000 tonnes of LHM over an initial eight-year term, representing roughly 20% of Vulcan’s planned output during this period. The deal includes market-based pricing mechanisms and is contingent on Vulcan achieving commercial production by 2028 and product qualification by 2029.
Completing the Financing Puzzle
With Glencore joining existing offtake partners Stellantis, Umicore, and LG Energy Solution, Vulcan has assembled a diverse and strategically aligned customer base spanning automakers, battery manufacturers, cathode producers, and commodity traders. This mix strengthens Vulcan’s position in the European lithium supply chain and satisfies a critical financing condition for the Phase One project.
Managing Director Cris Moreno highlighted the significance of the partnership, noting that Glencore’s expertise and European market presence add valuable flexibility and potential for future customer expansion. Discussions are ongoing with other European automakers interested in securing lithium volumes from the project.
Project Outlook and Market Impact
The Lionheart Project, located in the Upper Rhine Valley bordering Germany and France, is set to be Europe’s largest lithium resource and a tier-one global lithium project. Its capacity to produce enough lithium hydroxide for approximately 500,000 electric vehicles annually aligns with the accelerating demand for sustainable battery materials in the region.
Vulcan plans to finalize its Phase One financing package and related agreements by the end of 2025, with construction slated to commence shortly thereafter. The project’s innovative approach leverages geothermal energy and proprietary technology to deliver carbon-neutral lithium production, addressing both supply and environmental challenges in the EV battery sector.
Looking Ahead
Glencore’s Head of Lithium, Robin Francois, emphasized the strategic value of the partnership in supporting the development of a robust European lithium supply chain. As Vulcan moves closer to commercial production, the company’s ability to meet growing demand while maintaining sustainability credentials will be closely watched by investors and industry stakeholders alike.
Bottom Line?
With Glencore onboard, Vulcan is poised to unlock financing and accelerate Europe’s green lithium supply ambitions.
Questions in the middle?
- How will Vulcan’s pricing mechanisms adapt to volatile lithium markets over the contract term?
- What progress is being made on securing additional European automaker offtake agreements?
- When exactly will financing close and construction begin, and what risks remain?
