Cornish lithium (AIM:CUSN) miner looks for £40m to fuel electric car boom

To help its plans, a miner plans to produce enough lithium for the UK’s electric vehicle boom. He hopes to raise £40m next fiscal year.

Cornish Lithium was founded in 2016 and hopes to raise funds from carmakers and investment funds. Britain wants to decrease its dependence on rare metal imports from China.

Lithium, a key component of electric car batteries, is expected to increase ahead of the 2030 ban on petrol and diesel vehicles.

Cornish Lithium received £18m from TechMet, a leading metals investor. However, it will require more funding to continue testing and preparing for its approach.

Chief executive Jeremy Wrathall stated that although we still have a lot of TechMet money in the bank, it will be used for constructing the Trelavour demonstration plant and feasibility studies.

“So, we will be raising additional financing in 2023. It will target various funds that have approached us, as well as the potential automotive sector, which is becoming increasingly desperate for this material.

“We need to raise between £20-40m; the higher figure would allow us to make a construction decision.

Cornish Lithium plans to produce lithium from both rocks at Trelavour Downs near St Dennis and geothermal water in Cornwall.

It plans to begin production at Trelavour by 2026 and ramp up to produce between 8-10,000 tonnes of lithium hydroxide per year. It may start production from geothermal water as early as 2024.

It aims to eventually establish a network of small, modular geothermal production stations around Cornwall that each produce between 500 and 1,000 tonnes annually.

The cost of building a rock mining site is expected to be around $244m (£214m). While budgets are still being worked out for the geothermal sites (£214m), Mr Wrathall estimates that each site could cost around $30 million.

In 2016, Mr Wrathall, a mining analyst at Investec, quit searching for lithium in Cornwall. He then set up the company.

The company raised millions of pounds through thousands of retail investors, many of which live in Cornwall, along with the TechMet investment.

The company had hoped to list in the UK one day, but it decided not to do so due to market turmoil.

Mr Wrathall stated that capital markets are still very, very uncertain. “If you have people coming to our door asking for money, such as [carmakers] and big funds, then that is the best way forward. This will allow us to create more value for the IPO.

He stated that he wouldn’t rule out a listing next to the market if it improves. He said he is not ruling out additional crowdfunding in the future, but it doesn’t seem that way.

Due to the rising demand for electric cars, lithium prices have risen since 2021. “This is the mega-trend of our times,” stated Mr Wrathall.

China saw it coming. Everyone else was asleep, but everyone has woken up. This is the best time I could be alive. We are part of that energy transition. It’s both exciting and challenging.

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