Vulcan Energy Resources has outlined a second large-scale lithium development in Germany’s Upper Rhine Valley, with estimated capital expenditure of €1.26 billion, expanding its European battery-materials pipeline beyond the Lionheart project.
Project Ludwig Targets 21,100 Tonnes of Lithium Annually
A preliminary feasibility study for Project Ludwig, located about 60 kilometres north of Lionheart, envisages production of approximately 21,100 tonnes per year of battery-grade lithium carbonate over around 30 years. Total production is projected at roughly 517,000 tonnes during the project’s operating life.
The study estimates a post-tax net present value of €1.73 billion, based on an 8% discount rate, and a 20.2% post-tax internal rate of return using a lithium carbonate price of €20,588 per tonne. Estimated C1 operating costs are €4,101 per tonne, while the capital estimate includes a 15% contingency.
Lithium Production Combined With Geothermal Energy
Project Ludwig would combine geothermal energy production with lithium extraction from underground brines. The development is also expected to generate approximately 3,125 GWh of renewable heat annually.
The study provides Vulcan’s first detailed economic benchmark for its second development phase and points to a strategy focused on building a regional lithium-production platform rather than relying on a single project. Europe remains dependent on imported lithium chemicals despite major investments in battery and electric-vehicle manufacturing, increasing interest in domestic projects capable of producing processed lithium within the European Union.
Direct Lithium Extraction Brings Different Risks
Vulcan’s model differs from conventional hard-rock lithium mining by extracting lithium from geothermal brines while using the same reservoirs for renewable heat and power. The approach can reduce the need for conventional mining and crushing, but it places greater emphasis on well performance, brine chemistry, reinjection and direct lithium extraction technology operating reliably at commercial scale. The €1.26 billion capital requirement also highlights the financing challenge facing the development. Project returns will remain sensitive to lithium prices, construction costs and the performance of extraction and conversion systems.
Lionheart Execution Key to Ludwig
Project Ludwig’s projected 20.2% post-tax return indicates potentially competitive economics under the study assumptions. Vulcan must first demonstrate reliable commercial operations at Lionheart, making execution of the first project an important factor in the development case for Ludwig.
Further engineering, reservoir assessment and permitting will be required before Project Ludwig can advance towards a final investment decision. If both developments proceed, Vulcan could establish one of Europe’s larger domestic lithium-production platforms, combining geothermal energy, lithium extraction and processing within a common regional model.
