Renault SA, Vulcan Energy inks MoU for lithium supply
German-Australian start-up Vulcan Energy Resources Ltd has announced that it has signed a deal to supply lithium to Renault SA, the latest move by an electric vehicle manufacturer to lock down the supply of the battery metal ahead of an anticipated surge in demand.
Vulcan will provide 6,000 to 17,000 tonnes of lithium per annum to the French automaker from its geothermal brine deposits in Germany starting in 2026, the companies said. The five-year deal is renewable if both parties agree.
Renault, with brands involving Alpine and Dacia, has said it would like 90 percent of Renault models to be fully electric by 2030. The company said Vulcan's geothermal lithium production process, which has no carbon emissions, was the main appeal.
Vulcan plans to invest $2 billion to build geothermal power stations and facilities to extract lithium, to start production of the white metal in 2024.
Geothermal projects normally involve extracting super-hot lithium-rich brine from underground reservoirs and using the heat to produce electricity, after which lithium is extracted from the brine.
The brine is then reinjected into the earth, making the process more sustainable than open-pit mines and brine evaporation ponds, the two most common existing methods to produce the white metal.
Vulcan is backed in part by Hancock Prospecting, led by Executive Chairman Gina Rinehart, one of Australia's leading investors.