Posted on 05 Dec 2025
Australia-listed, Germany-focused Vulcan Energy Resources announced Wednesday a positive final investment decision for its Phase One Lionheart lithium project, Kallanish reports.
The company has secured a €2.2 billion ($2.56 billion) financing package to fully fund initial operations, with construction set to start in the coming days. The project, located in the Upper Rhine Valley, Germany, will produce 24,000 tonnes/year of lithium hydroxide monohydrate from geothermal brine.
Lionheart also targets co-production of 275 gigawatt-hours of renewable power and 560 GWh of heat per year. The 30-year project is key to unlocking European supply of battery raw materials, meeting demand from around 500,000 EV batteries a year. It’s touted as the largest lithium project in the region and the first to combine direct lithium extraction with renewable energy generation.
“A lighthouse project for Europe, Lionheart is set to redefine lithium production, delivering Europe’s first fully domestic and sustainable lithium value chain,” comments ceo Cris Moreno. “It will also provide a clean and reliable source of renewable energy for local communities and industries in Germany’s Upper Rhine Valley.”
The financing package was secured by VER GEO LIO – the asset-level entity that owns Phase One Lionheart. It includes a €1.18m debt financing package with a syndicate of 13 financiers, including the European Investment Bank, five export credit agencies, and seven major commercial banks such as France’s BNP Paribas, the Netherlands’ ING and Singapore’s OCBC.
The European Investment Bank was a cornerstone lender with a direct lending facility of €250m. Canada, Australia, Denmark and Germany also backed the project. Berlin, particularly, provided €204m in federal and state grants to support both the lithium and geothermal energy components of the project. The development has the status of a strategic project under the EU’s Critical Raw Materials Act (CRMA), which means it benefits from access to financing and streamlined permitting.
Additionally, Vulcan has also agreed equity investments, including from the German government’s raw materials fund KfW, which will invest €150m for a 14% stake in GermanSubCo – Vulcan’s German subsidiary. A consortium between HOCHTIEF, Siemens Financial Services and Demeter will also invest €133m in the company.
Commercial lithium hydroxide production is targeted in 2028, following a 2.5-year construction period. Vulcan says the first ten years of production are fully contracted through offtake agreements with LGES, Umicore, Stellantis and Glencore.
Source:Kallanish
