Australian mining magnate is funding ‘green’ lithium to help Europe’s battery makers catch China’s EV boom

Gina Rinehart’s Hancock Prospecting will become a cornerstone investor in Vulcan Energy Resource’s share sale to fund a lithium project in Germany

The Offenburg project claims it can extract lithium without emitting carbon dioxide by using a geothermal power plant

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Workers checking battery packs at a lithium battery factory in Tangshan, north China's Hebei Province on November 29, 2020. Photo: Xinhua

Published: 12:50pm, 4 Feb 2021Updated: 12:53pm, 4 Feb 2021

Mining billionaire Gina Rinehart’s mining empire will help to finance a lithium project in Germany being developed to supply the key ingredient for electric-car batteries needed by Europe’s auto industry.

Rinehart’s closely held Hancock Prospecting will become a cornerstone investor in Vulcan Energy Resources’ A$120 million (US$92 million) institutional share sale, with the proceeds to be used to further the development of the project. It plans to have a definitive feasibility study ready by 2022.

Vulcan, whose shares in Sydney have risen more than threefold this year, hopes to benefit from rising demand for lithium in Europe, which is trying to build up a local battery-manufacturing industry to reduce dependency on Asian suppliers. The company’s pre-feasibility study values its lithium resources near Offenburg at €2.8 billion (US$3.4 billion) before taxes.

The Australian start-up claims it can produce battery-grade lithium without emitting carbon dioxide by extracting lithium using a geothermal power plant in southern Germany. The method is similar to what Warren Buffett’s Berkshire Hathaway is researching in California’s Salton Sea.

Australian mining magnate Gina Rinehart speaking at a rally in Perth on June 9, 2010. Photo:: AFP

Rinehart, Australia’s richest person, is looking to gain exposure to the battery metal at a time when prices are starting to recover after a difficult 2020.