The Vulcan Energy Resources Ltd (ASX: VUL) share price is shooting up today after the company provided an update for its pilot lithium extraction plant.
The Vulcan share price is up 5.59% trading at $7.55 at the time of writing.
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What's driving the Vulcan share price today?
The company announced that its pilot plant team has achieved target specification for direct lithium extraction (DLE) feed into its pilot plant. This process diverts brine flow and extracts lithium, with lithium chloride sent to its lithium refining plant while water is recycled with no toxic wastes or gases emitted.
The team was able to achieve a target recovery of greater than 90% for lithium chloride from Upper Rhine Valley brine. In addition, it demonstrated that post-treated DLE brine to be materially the same composition, within analytical error, as production brine, excluding extracted lithium and silica. This result is in line with Vulcan's strict environmental focus.
The company said its next steps include the ramp-up of DLE pilot plant to a 24/7 operation and conversion of lithium chloride solution to lithium hydroxide. It will also provide samples to potential customers/off-takers and conduct further work on post-treatment of brine.
According to Vulcan's Zero Carbon Lithium Corporate presentation, project milestones including piloting, offtake agreements and feasibility studies are expected to be completed by mid-2022.
By that time, the company will seek to finance the project to begin drilling and construction for Phase 1 by the third quarter of 2022. The market is clearly excited about Vulcan shares and its near-term prospects of emerging as a zero-carbon producer of critical materials.
Management commentary
Vulcan managing director Dr Francis Wedin commented on the results, saying:
The latest update from our laboratory and pilot plant lithium extraction teams in Germany shows good progress has been achieved in a very short space of time. We will aim to continue this momentum and to continue to rapidly de-risk and scale-up our lithium extraction process in the months to come, as we execute on our strategy to deliver our Zero Carbon Lithium Project into production for the European battery electric vehicle market.
Dr Wedin also responded to comments made by the International Energy Agency (IEA). He said:
With the International Energy Agency last week declaring the need for annual battery production of 6,600 GWh by 2030, implying an annual lithium chemicals requirement of 22 times current total global production, Vulcan is leading the charge to reduce large carbon emissions currently embodied in the traditional production of lithium.
The team at Vulcan is highly motivated to ensure that the global transition to renewables, energy storage and electric mobility is conducted in a sustainable, net-zero manner, and we are channeling this motivation into systematically executing on our Zero Carbon Lithium Project.
