Updated: Jul 21, 2022
European Metals Holdings Limited (ASX: EMH; FSE: E86) is an ASX listed Company with a dual listing in Frankfurt, Germany.
The company is sustainably developing the largest hard rock lithium deposit in Europe. The resource is in the Cinovec region of the Czech Republic.
Lithium is an essential metal for lithium-ion and Lithium Iron Phosphate batteries. Renewable energy requires energy storage and lithium cathode-based batteries are still generally the fastest charging, longer-lasting and most energy efficient of available alternatives.
The company has partnered with Czech utility giant CEZ in a JV. EMH owns 49% of the project with CEZ owning 51%.
CEZ is the largest utility company in central Europe, with 70% ownership by the Czech Government and its shares are traded on Prague and Warsaw Stock Exchanges.
In October 2021 the Company announced a resource upgrade for the Cinovec lithium project with a new measured resource of 708MT including 53.3MT of new measured resource.
In November 2021 EMH announced outcomes of a Life Cycle Assessment conducted by Minviro in relation to battery chemicals production from the Cinovec Mine. Keith Coughlan, Executive Chairman of EMH said “Cinovec has the potential to have the lowest overall environmental impacts compared to other conventional lithium battery metals projects not only in Europe but also on a global basis”.
CEZ, EMH’s joint venture partner expects to provide 100% renewable energy to power the mine. The Company is also evaluating the use of electric mining equipment to further reduce the C02 footprint of the mine.
The CO2 emissions from Lithium Hydroxide production can also be significantly reduced through decarbonisation factors such as sourcing locally, using solar power and Hypex Bio Explosives.
The water use impact of the project is expected to be one of the lowest for any lithium project, due to plentiful supply of fresh water and comparisons with Chilean lithium projects in desert conditions.
Europe is spending big and this will ensure tailwinds such as uptake of electric vehicles and renewable energy continue to drive lithium demand. Over €1 trillion is to be spent on European Green Deal by 2030. The EU has also allocated over €40 billion to fund the transition from fossil fuels to green energy.
The board and management of European Metals Holdings are committed to strong ESG principals and utilise Social Suite ESG for reporting dashboard. The positive ESG profile includes:
European demand for sustainable and ethically sourced lithium and lithium hydroxide is predicted to continue to surge and provide strong tailwinds to the share price of EMH for the rest of 2022.
Europe expects to have over 30 million electric vehicles on the roads by 2030. To support this, Europe will require more than 559,000 tonnes of lithium by 2030.
Europe is fast becoming a global powerhouse in giga-factory and battery cell manufacture, as this recent graphic from batterynews.de highlights.
Europe has become the fastest growing region for new electric vehicle lithium-ion battery capacity outside China. By 2030 Europe is expected to have 27 gigafactories operational with a capacity of over 789GWH.
Of major interest is the Tesla Gigafactory near Berlin, which is expected to commence operations in 2023 and reach full capacity by 2030 with 125 GWH. Giga-Berlin is expected to be Europe's largest gigafactory and the world's second largest lithium ion battery plant behind its Tesla cousin in Austin, Texas.
The German Mineral Resources Agency (DERA), the raw materials competence centre for the Germany economy, predicts in a report dated 28 June 2022, an impending lithium shortage of up to 341,000 tons in Europe by 2030.
There are very few quality lithium projects in mainland Europe likely to see near-term production. Currently, there is only one operating lithium mine in Portugal.
Serbia likely has significant reserves, but as Rio Tinto discovered, there is strong on-ground opposition to large scale mining here from environmental groups.
A recent report by European Boutique Investment Bank, DGWA, mentions Vulcan Energy's (ASX: VUL) geo-thermal project in the Upper Rhine Valley in Germany. Whilst the size of the project, current partners and offtakes are impressive, the report mentions potential obstacles to project commencement such as cost-intensive development works and further evaluation of the technology .
The report can be veiwed at https://www.dgwa.org/post/dgwa-update-lithium
About 87% of European demand for unrefined lithium is imported from Australia. And 80% of European lithium hydroxide chemicals are sourced from China.
European Metals Holdings Ltd's May 2022 Investor Deck can be downloaded below.