Vulcan Energy Secures Major Funding and Commences Construction on Flagship Lithium Project

Vulcan Energy Resources has transitioned from planning to active construction on its pioneering European lithium venture. The Australia-based developer has successfully closed a substantial €2.2 billion financing package for the initial phase of its integrated geothermal lithium operation in Germany, with site work now officially underway.

Construction Phase Launches Following Final Investment Decision

A pivotal Final Investment Decision (FID) was ratified by the company’s board in December 2025, greenlighting the commencement of the Phase One “Lionheart” project. This milestone triggered the immediate start of construction activities at the site in Landau, where a facility for geothermal lithium extraction is being developed. The project has all necessary building permits in place, including the specific authorization for the lithium extraction plant.

Project Specifications and Commercial Backing

The operational goal for the Landau facility is an annual production capacity of 24,000 tonnes of battery-grade lithium hydroxide. This output is estimated to be sufficient for approximately 500,000 electric vehicle batteries each year. In a significant commercial endorsement, global commodities group Glencore has committed to an offtake agreement for between 36,000 and 44,000 tonnes of lithium hydroxide. This supply contract spans an initial eight-year period, providing considerable revenue visibility for the venture.

Concurrently, the plant is designed to generate renewable geothermal energy and heat, aligning with its decarbonization objectives.

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Technical Validation and Market Context

Supporting the project’s technical feasibility, Vulcan Energy reported successful production tests from a newly drilled well in the Upper Rhine Valley at the end of January 2026. These tests confirmed robust well deliverability, validating the reservoir assumptions within the Phase One field development plan.

The project’s advancement occurs alongside a broader recovery in lithium market sentiment during 2025, fueled by sustained demand growth from the electric vehicle and energy storage sectors. Vulcan Energy’s model aims to establish Europe’s first fully integrated, carbon-neutral lithium supply chain, a goal that aligns directly with strategic European Union initiatives. The EU is actively supporting the development of localized battery production and raw material supply chains to reduce reliance on foreign sources.

With major financing secured and earthmoving equipment mobilized, Vulcan Energy has entered a critical execution phase. The focus now shifts to adhering to its development timeline as it works to bring a domestic source of lithium to the European market.