Vulcan Energy (ASX: VUL) has entered into a staged agreement with one of the world’s largest chemical producers, BASF SE (BASF), to collaborate on the development of a renewable heat project to supply BASF with baseload heat.
The agreement incorporates the potential construction of a commercial Lithium Extraction Plant in Ludwigshafen, BASF’s global headquarters and home to the largest integrated chemical complex globally.
Key highlights
- Vulcan and BASF to jointly develop a renewable geothermal heat project to supply BASF’s Verbund site Ludwigshafen with affordable baseload heat via a staged agreement
- Approximately 2000–2500 GWh/a of heat generation is targeted from the Ludwigsland Development Project (LDP) from an integrated renewable heat and lithium brine operation, representing a significant amount of the heat demand of BASF
- Ludwigshafen is BASF’s global headquarters and employs around 34,000 people. It serves as a key economic and industrial hub within the Upper Rhine Valley and is a significant contributor to the region’s growth and development
- Beyond reducing CO2 emissions of BASF’s Verbund site Ludwigshafen operations, the geothermal opportunity extends to the potential for district heating to supply households in nearby cities. Vulcan and BASF are collaborating with regional energy providers — Technische Werke Ludwigshafen and Stadtwerke Frankenthal - to evaluate the feasibility of energy supply to the two cities, representing a major step toward sustainable, low-emission heating for local communities
- Vulcan and BASF plan to evaluate the possible construction and operation of a Lithium Extraction Plant on BASF premises within the Verbund site Ludwigshafen to produce lithium salts concentrate following energy production from the hot brine. This would then be transported to Vulcan’s Central Lithium Plant to produce battery grade lithium hydroxide for Europe’s electric vehicle (EV) market
- Vulcan will be the active project developer and integrated operator across the heat and lithium production facilities and would retain 100% ownership of the lithium production
- BASF will jointly fund the geothermal exploration as the first phase of the project. Assuming the first phases of the project, including seismic campaigns, exploratory well and doublet drilling are successful, and the partners decide to proceed with the project, BASF will be the heat offtaker for 100% of the geothermal heat
Moving forward, Vulcan will seek to replicate this model across the Upper Rhine Valley, building affordable renewable heating production to decarbonise European industry and the public heating sector. The deep geothermal wells can also then be utilised to produce lithium chloride from the same brine for EV batteries.
“Partnering with Germany’s largest chemical company, BASF, to provide renewable geothermal heat at their Ludwigshafen headquarters is an excellent demonstration of Vulcan Energy’s dual commitment to decarbonise energy and lithium production via our integrated business approach,” Vulcan’s Managing Director and CEO, Cris Moreno, said.
“This collaboration highlights how geothermal renewable energy and carbon neutral lithium production can work harmoniously together, delivering mutual benefits for industry and communities.
“This agreement represents a strategic partnership between BASF and Vulcan, setting the course and providing a blueprint for advancing long term geothermal renewable energy production across the Upper Rhine Valley, while delivering battery- grade lithium product to drive Europe’s transition to green electromobility.”