Vulcan Energy Resources Ltd. · ASX:VUL
Vulcan Energy Resources — Shareholder Meeting (November 2022)
52 slides from Vulcan Energy Resources's shareholder meeting presentation, Nov 29, 2022
Slide 1: Annual General Meeting
For personal use only Annual General Meeting Tuesday, 29 November 2022 Dr Francis Wedin, Managing Director and CEO 1
Slide 2: Disclaimer
DISCLAIMER No investment or financial product advice or results, or otherwise. Neither Vulcan nor any of its directors, officers, agents, employees or advisors give any This Presentation, and the information provided in it, does not constitute, and is not intended to constitute, financial representa
Slide 3: Our Target: 1 Million
OUR TARGET : 1 MILLION We are aiming to become the world’s first integrated lithium chemicals and renewable energy producer with net zero For personal use only greenhouse gas emissions. Vulcan’s unique Zero Carbon Lithium™ Project aims to produce both renewable geothermal energy, and lithium hydroxi
Slide 4: Key Achievements H2 2021-Now
KEY ACHIEVEMENTS H2 2021-NOW VUL now ACQUISITION OF For personal use only ASX300 INSHEIM GEOTHERMAL POWER PLANT High grade, Lowest Research Permit Sustainability impurity LiOH produced in Italy Granted and ESG from ZCL "Cesano” Framework CAPITAL launched BNP Paribas RAISE appointed as €124M Acquisit
Slide 5: Right Place, Right Time
For personal use only RIGHT PLACE, RIGHT TIME Rapidly advancing the Zero Carbon Lithium™ Project to ensure timely market entry Strategically placed in the heart of the European EV market to decarbonise the supply chain 55
Slide 6: Lithium in Europe: Averting a Crisis for the Auto Industry
LITHIUM IN EUROPE: AVERTING A CRISIS FOR THE AUTO INDUSTRY Vulcan has offtake For personal use only EU cars 100% electric agreements with the by 2035 largest battery, cathode and EV producers in Europe 1,300GWh li-ion battery manufacturing capacity by Vulcan is developing the only 20301 for EV trans
Slide 7: Energy in Europe: Averting a Crisis for All
ENERGY IN EUROPE: AVERTING A CRISIS FOR ALL Fraunhofer: Geothermal For personal use only EU to be climate neutral by renewable energy can meet a 2050. Germany to be fully quarter of Germany’s heating renewable renewablebyby2035. 2035 needs German government to provide support for renewable heating p
Slide 8: The Solution: Zero Carbon Lithium Project
THE SOLUTION: ZERO CARBON LITHIUM™ PROJECT For personal use only • Large, 300km-long graben system containing very consistent geothermal-lithium reservoir, average lithium grade 181 mg/l Li, Europe’s largest lithium resource. • Vulcan’s Zero Carbon LithiumTM Project contains multiple project areas,
Slide 9: The Process
For personal use only THE PROCESS Delivering a fully integrated renewable energy and sustainable lithium chemicals business in Europe 9
Slide 10: For personal use only
For personal use only Central Lithium lant orption lant Geothermal plant ells Geothermal and lithium brine eld resource 10
Slide 11: Vulcan's Renewable Energy and Lithium Chemicals Project
VULCAN’S RENEWABLE ENERGY AND LITHIUM CHEMICALS PROJECT Electric Mobility OUR PROJECT For personal use only Lithium hydroxide Central ONE Central distributed Lithium to the EU market lant Lithium Plant in Central Frankfurt Lithium converting LiCl lant 6 to LiOH orption lant Renewable electricity Lit
Slide 12: Upper Rhine Valley Brine Field Geothermal-Lithium Resource
UPPER RHINE VALLEY BRINE FIELD GEOTHERMAL-LITHIUM RESOURCE Electric Mobility Sub-surface reservoir in Vulcan’s URVBF includes Europe’s largest lithium resource (15.85Mt LCE1), and the highest geothermal For personal use only renewable energy potential in central Europe. Central ACHIEVED: Lithium lan
Slide 13: Development Drilling
DEVELOPMENT DRILLING Electric Mobility Vulcan has established its own in-house geothermal drilling company, Vercana, due to a high demand for geothermal drilling for For personal use only renewable energy projects and tightness of rig supply. Vercana is a highly strategic asset for Vulcan as Germany
Slide 14: Geothermal Renewable Energy: Current Production
GEOTHERMAL RENEWABLE ENERGY: CURRENT PRODUCTION Electric Mobility ACHIEVED: For personal use only ▪ During the year, Vulcan acquired an existing geothermal renewable energy plant with proven lithium-in-brine grades over 10 years of successful production. Central Lithium ▪ The plant, named Natür³Lich
Slide 15: Developing Renewable Energy Infrastructure on a Mass Scale
DEVELOPING RENEWABLE ENERGY INFRASTRUCTURE ON A MASS Electric SCALE Mobility As well as running an existing geothermal plant, Vulcan is aiming to build and operate multiple geothermal assets across its licenses For personal use only and produce both electricity and heat. ACHIEVED: Central Lithium ▪
Slide 16: Lithium Chloride Extraction: Sorption Plant
LITHIUM CHLORIDE EXTRACTION: SORPTION PLANT Electric Mobility Lithium sorption used commercially for 26 years. Currently used by 5 commercial projects in China and South America, with many For personal use only more being built. Lithium adsorbs onto an aluminate-based resin, desorbed using water, th
Slide 17: Lithium Chloride Extraction: Sorption Plant
LITHIUM CHLORIDE EXTRACTION: SORPTION PLANT Electric Mobility NEXT STEPS: For personal use only ▪ Second pilot plant started operating under pressure (20 bar) – potentially a significant upside for CAPEX/OPEX savings. Central Lithium ▪ Demonstration Plant to operate in 2023 to train operations team
Slide 18: New Lithium Brine Projects Choosing Sorption
NEW LITHIUM BRINE PROJECTS CHOOSING SORPTION Lanke Zangge Eramet/ Vulcan Compass Berkshire Energy Standard Lake Company Livent Jintai Lithium Rio Tinto Source CTR Resources/ E3 Metals Lithium Lithium Tsingshan Energy Minerals Hathaway Minerals Lithium Lilac Hombre Centenario- Zero Carbon Great Salt
Slide 19: Lithium Hydroxide Production: Central Lithium Plant
LITHIUM HYDROXIDE PRODUCTION: CENTRAL LITHIUM PLANT Electric Mobility Conversion of lithium chloride to battery grade lithium hydroxide using electrolysis, powered by green electricity. Process uses same technology used in the chlor-alkali industry, which has been producing for over a century. Signi
Slide 20: Long Term Lithium Supply Contracts Secured
LONG TERM LITHIUM SUPPLY CONTRACTS SECURED Electric Mobility ACHIEVED: Binding lithium hydroxide offtake agreement, 10-year term. For personal use only A$76M (€50M) equity investment from tellantis. This represents the world’s first upstream investment in a listed lithium company by a top tier autom
Slide 21: Our Expansion Plan - The Upper Rhine Valley Brine Field
OUR EXPANSION PLAN - THE UPPER RHINE VALLEY BRINE FIELD Electric Mobility Lithium offtake agreements Production volume & CAPEX to be included in the DFS Production volume & CAPEX to be included in updated PFS For personal use only PHASE 1 - €XBn CAPEX PHASE 2 - €XBn CAPEX PHASE + Central Lithium lan
Slide 22: Attractive Market and Financial Metrics
For personal use only ATTRACTIVE MARKET AND FINANCIAL METRICS It doesn’t need to cost more to be “green” 22 22
Slide 23: Lithium Price Environment
LITHIUM PRICE ENVIRONMENT LITHIUM BUSINESS For personal use only Historical lithium prices Market balance outlook -> Deficit January 2018-August 2022 ($/tonne, monthly average) November 2022 kt LCE 90 80 Fastmarkets 0 Contract price 70 $73,000 60 50 +400% -200 40 30 20 -400 10 0 2022 Banks long term
Slide 24: Potential for Very Low Opex Operation
POTENTIAL FOR VERY LOW OPEX OPERATION elect outh American brine and Australian/Chinese mineral conversion vs Vulcan’s process For personal use only LiOH VIA HARD-ROCK PROCESSING US$51,212/t LiOH Feedstock US$48,750¹ US$2,462² €50,700/t LiOH Vulcan’s “feedstock” is expected to be low cost and Mineral
Slide 25: Robust Target Project Financials and Production Metrics from PFS
ROBUST TARGET PROJECT FINANCIALS AND PRODUCTION METRICS FROM PFS – UPDATE IN DFS UNDERWAY For personal use only FUNDING TO COME FROM A MIX OF EQUITY, DEBT AND GRANTS LITHIUM BUSINESS 40,000tpy LiOH €2.8Bn NPV Pre-tax €1.9Bn NPV Post-tax LITHIUM BUSINESS 31% IRR Pre-tax 26% IRR Post-tax €2,681/t LiOH
Slide 26: Sustainability
For personal use only SUSTAINABILITY 26 26
Slide 27: Our Approach to Sustainability
OUR APPROACH TO SUSTAINABILITY For personal use only 27
Slide 28: Leading Environmental Credentials
LEADING ENVIRONMENTAL CREDENTIALS Storm Taylor ESG Lead For personal use only Per tonne of lithium hydroxide produced CARBON EMISSIONS WATER CONSUMPTION LAND USE REAGENTS CONSUMPTION WASTE GENERATION (Scope 1,2,3) Tonnes CO2 m3 m2 Tonnes Tonnes Hard rock mining 60% of world lithium production Evapor
Slide 29: Government Relations
GOVERNMENT RELATIONS MACRO POLICY SETTINGS IN OUR FAVOUR For personal use only "Geothermal energy is reliably available to us year-round: it is weather- independent, crisis-secure, and nearly inexhaustible. That is why it is right to continue to advance the use of geothermal energy in Germany.” Robe
Slide 30: Community at the Heart of Everything We Do
COMMUNITY AT THE HEART OF EVERYTHING WE DO For personal use only 30
Slide 31: The Right Team for the Job
For personal use only THE RIGHT TEAM FOR THE JOB 31 31 31
Slide 32: Our Main Strength: Our People
OUR MAIN STRENGTH: OUR PEOPLE 180 FTE within the Vulcan Group For personal use only • • Top scientists, engineers and professionals within the fields of lithium chemistry, chemical engineering, geothermal energy, drilling, reservoir engineering and geology. • Highly motivated team dedicated to creat
Slide 33: Board of Directors
BOARD OF DIRECTORS Dr. Francis Wedin For personal use only Managing Director & CEO Gavin Rezos Ranya Alkadamani Chair Non-Executive Director Founder of Vulcan Zero Carbon Lithium™ Project. Lithium Executive Chair/CEO positions of three companies that grew from Founder of Impact Group International.
Slide 34: Project Execution
For personal use only PROJECT EXECUTION 34 34
Slide 35: Project Execution & Delivery Capability
Sites Projects PROJECT EXECUTION & DELIVERY CAPABILITY Vulcan Board / Oversight Committee Executive Project SteerCo Portfolio Approach - Executing different projects to achieve one goal For personal use only Project Director(ate) • Vulcan Energy is transitioning from a Development Company to an Inte
Slide 36: Target Project Timeline
TARGET PROJECT TIMELINE For personal use only PHASE I 2022 2023 2024 2025 2026 + DFS Pilot Plant Sorption Operational. Started in 2021 Demonstration Plant Sorption Construction Com. Operating Demonstration Plant Li Electrolysis Construction Com. Operating Financing Permitting Started in 2021 Drillin
Slide 37: Share Price and Capital Structure
SHARE PRICE AND CAPITAL STRUCTURE ASX : VUL For personal use only Shares on Issue 143,335,301 Performance Shares 91,174 Performance Rights 8,627,427 Market Capitalisation at $7.05 (undiluted) ~$1.01B Cash Position (as at 30 Sep 2022) €158M Top 20 Stakeholders ~60% Management (undiluted) ~17% Frankfu
Slide 38: Thank you
Thank you For personal use only Media and Investor Relations Jessica AnnabelBukowski Roedhammer jbukowski@v-er.eu aroedhammer@v-er.eu @VulcanEnergyRes|www.v-er.eu|info@v-er.eu @VulcanEnergyRes | www.v-er.eu | info@v-er.eu ASX:VUL ASX:VUL FSE:VUL FSE:VUL Annabel Roedhammer Daniel Tydde Head of Invest
Slide 39: Appendices
For personal use only APPENDICES 39
Slide 40: Appendix 1: Largest JORC Lithium Resource in Europe
APPENDIX 1: LARGEST JORC LITHIUM RESOURCE IN EUROPE For personal use only Germany Probable Reserve 0.7 Ortenau License Indicated Resource 2.06 Inferred Resource 10.8 Total 12.86 Probable Reserve 0.42 License Indicated Resource Taro 0.83 Inferred Resource 1.44 Total 2.27 France Probable Reserve 1.12
Slide 41: Appendix 2: Europe-Focused and Lithium Brine Projects Peer Comparison References
APPENDIX 2: EUROPE-FOCUSED AND LITHIUM BRINE PROJECTS PEER COMPARISON REFERENCES For personal use only COMPANY1 CODE PROJECT STAGE RESOURCE CATEGORY RESOURCES M RESOURCE GRADE CONTAINED MT INFORMATION SOURCE TONNES (LI2O) LCE TONNES Corporate Presentation July European Metals ASX: EMH Cinovec PFS Co
Slide 42: Appendix 3: Vulcan Will Supply Leading Actors Across the Lithium-Ion Battery Supply Chain
APPENDIX 3: VULCAN WILL SUPPLY LEADING ACTORS ACROSS THE LITHIUM-ION BATTERY SUPPLY CHAIN For personal use only Battery metals Cathodes Lithium-ion batteries Electric vehicles 42
Slide 43: Appendix 4: Brine Projects and Assets - References
APPENDIX 4: BRINE PROJECTS AND ASSETS - REFERENCES For personal use only Livent https://s22.q4cdn.com/453302215/files/doc_presentations/2021/11/Livent-Investor-Presentation_for-website.pdf https://www.linkedin.com/pulse/from-catamarca-qinghai-commercial-scale-direct-lithium-alex-grant/ Lanke Lithium
Slide 44: Appendix 5: Project Development Timeline: Example for One Project Area
APPENDIX 5: PROJECT DEVELOPMENT TIMELINE: EXAMPLE FOR ONE PROJECT AREA For personal use only Environmental Impact Assessment Main Permits Exploration licenses (geothermal energy Extraction licenses (geot. energy prod. Federal Immission Control Geothermal energy production and lithium extraction) and
Slide 45: Appendix 6: Brine Flow Rates
APPENDIX 6: BRINE FLOW RATES For personal use only Until we drill our first wells, risks around flow rate will remain. However, Vulcan believes it has an appropriate level of confidence around its flow rates assumptions, based on the experience of its team, and state-of-the-art scientific tools, dat
Slide 46: Appendix 7: Potential European Expansion in Italy
APPENDIX 7: POTENTIAL EUROPEAN EXPANSION IN ITALY Vulcan and Enel Green Power have signed a For personal use only binding collaboration agreement • Vulcan and Enel Green Power have signed a binding collaboration agreement to explore and develop its Cesano license in Italy on a 50:50 basis • The Part
Slide 47: Appendix 8: Vulcan Group - Corporate Structure
APPENDIX 8: VULCAN GROUP - CORPORATE STRUCTURE For personal use only Vulcan Energy Resources Ltd. Vulcan Group All holdings 100% except Australia Kuniko Ltd (20%) Vulcan Energy Vulcan Energy Kuniko Ltd Resources Italy Pty Ltd Europe Pty Ltd Vulcan Energie Vulcan Group Ressourcen GmbH France Vulcan E
Slide 48: Appendix 9: FY22 Financial Highlights
APPENDIX 9: FY22 FINANCIAL HIGHLIGHTS STRUCTURE For personal use only EUR 124 million capital raise EUR 50 million equity investment 8% shareholding Acquisition of 2 electric drill rigs Acquisition of Insheim geothermal power plant Completed acquisition of GeoT and Gec-co businesses Deconsolidation
Slide 49: Appendix 10: Auto Battery and Cathode-Makers Need Carbon Neutral Battery Metals
APPENDIX 10: AUTO BATTERY AND CATHODE- MAKERS NEED CARBON NEUTRAL BATTERY METALS For personal use only However, current lithium ‘Reducing carbon footprint is not just reducing vehicle emissions while they production has a significant are being operated, but also […] from the company's resource extra
Slide 50: Appendix 11: Germany Needs Renewable Energy on an Extraordinary Scale
APPENDIX 11: GERMANY NEEDS RENEWABLE ENERGY ON AN EXTRAORDINARY SCALE Fraunhofer geothermal For personal use only German Coalition Agreement includes order to secure the goal of climate neutrality roadmap7 ▪ Installation of 70GWh of • Generate almost all the country’s electricity from renewable sour
Slide 51: Appendix 12: European Macro Policy Tailwinds in Vulcan's Favour
APPENDIX 12: EUROPEAN MACRO POLICY TAILWINDS IN VULCAN’S FAVOUR European Commission President, Ursula von der Leyen For personal use only Lithium production for EVs “Lithium and rare earths will soon be more important than oil and gas. Our demand for rare earths alone will increase fivefold by 2030.
Slide 52: Appendix 13: Working Hard to De-risk the Project Further
APPENDIX 13: WORKING HARD TO DE-RISK THE PROJECT FURTHER AND ADDRESS ALL IDENTIFIED RISKS For personal use only Risk Mitigation Availability Drill rigs that can reach the deep geothermal reservoirs are Vulcan has agreed to acquire two electric drill rigs, re-purposed from the oil and gas industry, w
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