Vulcan Energy Signs Offtake Deal with Glencore

Vulcan Energy, Australia’s renewable energy producer, on Monday said that it has signed an offtake agreement with a wholly owned subsidiary of Glencore plc, one of the world’s largest natural resource companies, to provide battery-quality lithium hydroxide monohydrate (LHM) from its Phase One Lionheart Project.

One Lionheart Project, which is located on the border of France and Germany, is expected to produce 24,000 tonnes of LHM per year once completed, enough for around 500,000 battery electric vehicles, and will have the capacity to produce 275 GWh of power.

The Company has signed a binding offtake agreement to supply Glencore, a multinational commodity trading and mining company headquartered in Switzerland, between 36,000 tonnes and 44,000 tonnes of LHM over the duration of an initial eight-year period.

Glencore produces and markets more than 60 commodities through approximately 60 assets and has offices in over 30 countries and joins Stellantis, Umicore and LG Energy Solution as the Company’s offtake partners for Phase One and represents the final offtake agreement required for Phase One project financing.

All agreements are binding, take-or-pay and with agreed pricing mechanisms across six to ten years duration. The pricing mechanisms are a basket of fixed, floor-ceiling and index-based floating prices during the proposed debt payback period.

The agreement with Glencore offers the possibility of a European partnership for end users. There are discussions with other potential customers, including German and European automakers, who have expressed an interest in taking further volumes from Phase One.

The company is targeting to finalise its Phase One financing package, together with project and financing agreements, in Q4 2025, before commencing construction of the commercial plants.

Vulcan Energy’s Managing Director and CEO Cris Moreno welcomed the start of a long-term relationship with Glencore.

With this agreement- a key requirement for Phase One financing – Vulcan has now achieved a good mix of offtake partners for Phase One lithium production: an automaker, a battery maker, a cathode manufacturer, and a commodities trader, all with a strong European focus.

“The agreement also gives Vulcan the flexibility to bring in further European customers in the future, while also utilising Glencore’s expertise in this market, which is a value-add to Vulcan,” Moreno added.

Glencore’s Head of Lithium, Robin Francois said that they were pleased to partner with Vulcan to help support the development of the German and wider European lithium supply chain.

“This new agreement with Vulcan will further expand our lithium portfolio and reinforce our position as one of the leading suppliers of battery raw materials,” he added.

Material Terms

Glencore is to purchase 36,000 to 44,000 tonnes of battery-quality lithium hydroxide over the duration of the agreement, representing approximately 20% of Vulcan’s current planned output over the period.

Vulcan will be achieving start of commercial production during 2028, and product qualification during 2029. The pricing is based on a market-based pricing mechanism

Finalising project financing, start of commercial production, qualification of product and the agreement also otherwise contains terms and conditions that are standard for an agreement of this nature, including termination rights upon breach or default.