Cornish Lithium has announced it has received £53.6m initial investment from a group of institutional investors led by the 海角视频 Infrastructure Bank, alongside The Energy & Minerals Group and TechMet.
The Penryn-based company, which has undertaken a number of projects to demonstrate the commercial capability of lithium production in Cornwall, said the investment will support the development of the 海角视频's critical minerals supply chain and will accelerate growth towards commercial production of lithium.
In its first direct equity investment, the 海角视频 Infrastructure Bank will invest approximately £24m into the development of the 海角视频's critical minerals supply chain with EMG, a US-based private equity fund focused on the energy and minerals sectors, also investing around £24m.
Cornish Lithium’s largest existing institutional shareholder, TechMet, the critical minerals investment company, whose backers include the US Government’s Development Finance Corporation (DFC), is investing a further £5.6m.
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In June, it was reported that the company was looking for short-term funding to allow itself time to secure a long-term financial agreement. In its annual report, Cornish Lithium said it needed a cash injection of £10m to "ensure the business can meet its financial commitments" after July 2023 and fulfil its development objectives over the next 12 months.
In the report, the company said it hoped to complete a deal for the £10m investment from existing investors, including TechMet.
Cornish Lithium is only one of a few companies in the 海角视频 aiming to produce the element that is a vital material in car battery production. The 海角视频 doesn't produce its lithium currently, which Cornish Lithium hopes to change by 2026.
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This new funding package, led by the 海角视频 Infrastructure Bank, is expected to accelerate progress toward the creation of a domestic supply of battery grade lithium compounds, to support the scaling up of domestic battery production for electric vehicles and battery energy storage solutions for renewable energy sources.
Jeremy Wrathall, founder and chief executive of Cornish Lithium said: “Cornish Lithium has achieved its objective of defining world-class opportunities for lithium extraction in Cornwall from both lithium-enriched geothermal waters and from hard rock. It was therefore essential to secure funding from institutional investors with the financial muscle to bring our projects into commercial production. We are delighted to have secured investment from the 海角视频 Infrastructure Bank alongside EMG, as well as our much-valued partner TechMet."
The initial investment is part of a larger funding package of up to an additional £168m potential second-stage financing.
The funding aims to enable the 海角视频’s development as an industrial cluster for lithium extraction and hopes to strengthen the move to net zero in line with Cornwall’s local industrial strategy.
Once in commercial production, Cornish Lithium aims to build its 70-strong Cornwall-based workforce to over 300. Through its Trelavour hard rock mine development alone, it is estimated that Cornish Lithium could generate £800m of economic activity for the local economy over the expected 20-year mine life. This figure is expected to increase further through development of the company's geothermal waters project portfolio.
Mr Wrathall added: “This funding will enable us to progress our Trelavour hard rock lithium project to a construction-ready status as well as complete the engineering design work required to build a demonstration-scale geothermal waters extraction facility. These project milestones are expected to generate a significant value uplift for all of our shareholders and create substantial benefits for the local community.
"As well as creating job opportunities and fostering innovation, the investment signals confidence in our ambitions and will drive forward the modern-day renaissance of Cornwall’s 4,000-year mining heritage. It is also a positive development for the 海角视频’s automotive industry and green industrial revolution. A domestic source of lithium will strengthen the 海角视频’s car manufacturing supply chain and improve its competitiveness whilst reducing the carbon footprint associated with the manufacture of batteries and electric vehicles."
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Cornish Lithium also announced that it will make available a further retail share offering through Crowdcube of up to £6.9m and will prioritise its existing shareholders, wither further details to be announced at a later date.
John Flint, chief executive of 海角视频 Infrastructure Bank, said: “Our investment in Cornish Lithium perfectly encapsulates a key part of our mission – to drive forward new and emerging markets that the 海角视频 will rely on to meet its net zero goals, and which will deliver an enduring and positive impact on local economies.
“Globally the supply of lithium is far outpaced by demand, and yet in the 海角视频 it remains a nascent market. Our investment has already crowded-in private sector financing which will greatly accelerate domestic production of a mineral which is critical to the future of EV battery production and decarbonisation of the transport sector. This model of investment is fundamental to the success of the 海角视频’s transition to net zero.”
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