UK Infrastructure Bank Grants Cornish Lithium £53.6m in Funding
Image: Cornish lithium exploration at Gwennap | Credit: Neil Williams
Business Secretary Kemi Badenoch has welcomed the investment in a domestic lithium producer as 'great news' for the British electric vehicle (EV) industry.
Cornish Lithium, a company engaged in lithium exploration, has successfully obtained $53.6 million from a consortium of institutional investors, with UK Infrastructure Bank leading the funding round.
The Energy & Materials Group, a US-based private equity fund, and the public investment bank invest £24 million each in the Cornwall-based startup. Additionally, the specialist minerals investment company and TechMet, the existing shareholder, are allotting an additional $7 million.
To avoid insolvency after facing a deficit of £6.6m in 2022, Cornish Lithium had previously warned that it required an injection of £10m. This investment has supplied the much-needed financial boost.
The company strives to obtain lithium from Cornwall's thermal waters and rock formations by utilizing technology that they declare has a drastically lessened water and carbon footprint than traditional lithium production.
Jeremy Wrathall, CEO and originator of the organization, praised the investment as a turning point in forming a domestic battery supply chain that could contribute to the UK's burgeoning electric vehicle manufacturing industry.
He emphasized the significance of the investment, not only in job creation and encouraging innovation but also in conveying confidence in their aspirations and promoting the modern-day renaissance of Cornwall's 4,000-year mining history. Additionally, it is a positive advancement for the British automotive industry and the green industrial revolution. Having a domestic source of lithium will bolster the UK's automotive supply chain and make it more competitive while diminishing the carbon footprints associated with producing electric vehicle batteries.
According to Wrathall, the financial support they received will allow the company to move their Trelavour hard rock lithium project towards its "construction-ready status" and finish the engineering design work necessary to construct a demonstration-scale geothermal waters extraction facility.
Kemi Badenoch, the Secretary of State for Business and Trade, praised the investment as being "marvelous news for the Cornish economy and for the UK automotive industry overall."
The Secretary highlighted that the government had put together the right plan to create the batteries required to increase the UK's domestic electric vehicle production. Additionally, with Tata Group's gigafactory announcement, preparations for the automotive sector's future are underway.
John Flint, the CEO of the UK Infrastructure Bank, declared that the investment in Cornish Lithium "very appropriately represents" the mission of the public investment bank, which is "to propel new and nascent markets that the UK will depend on to achieve its net zero objectives, and that will provide a long-term and beneficial effect on local economies."
He noted that worldwide, the demand for lithium is much greater than the supply, yet it is still a relatively new market in the UK. "Our funding has enticed private sector investments which will hasten the production of this mineral, which is essential for the production of EV batteries and the decarbonization of transport," he stated. "This type of investment will be vital for the UK's progress toward a net-zero carbon footprint."
The UK Infrastructure Bank has made its first direct equity investment in the investment markets.
Cornish Lithium has announced the launch of a £6.9m retail share offering through the crowd-funding platform Crowdcube following the completion of their latest round of investment. Existing shareholders will be given priority.
The study pointed out that the investment may provide £210m for the company to achieve its commercial production objectives.
Just four weeks ago, British Lithium announced a collaboration with the French mining outfit Imerys, the outcome of which is the planned construction of a sizable lithium mine in Cornwall.