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The UK’s ambition to scale up domestic battery production has been boosted by a major investment from the UK Infrastructure Bank.
In the first direct equity investment since its inception, the UK Infrastructure Bank will invest approximately £24 million into the development of the UK’s critical minerals supply chain with EMG, a US-based private equity fund, matching the investment.
The investment will be received by Cornish Lithium, whose largest shareholder TechMet is also investing further £5.6 million.
The funding package is expected to significantly accelerate progress toward the creation of a domestic supply of battery grade lithium compounds, which is needed to support the scaling up of domestic battery production for electric vehicles and battery energy storage solutions for renewable energy sources.
The initial investment is part of a larger funding package, with an additional £168 million proposed as second-stage financing.
Jeremy Wrathall, founder and CEO of Cornish Lithium, said: “This funding will enable us to progress our Trelavour hard rock lithium project to a construction-ready status as well as completing 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 UK’s automotive industry and green industrial revolution.
“A domestic source of lithium will strengthen the UK’s car manufacturing supply chain and improve its competitiveness whilst reducing the carbon footprint associated with the manufacture of batteries and electric vehicles.”
Once in commercial production, Cornish Lithium aims to build its 70-strong Cornwall-based workforce to over 300. Cornish Lithium believes its project can then generate about 7,000 tonnes of lithium carbonate equivalent (LCE) a year from late 2026 over the expected 20-year mine life.
Concerns about looming global lithium shortages have been raised in the past 12 months, with some forecasting that it will hamper electric vehicle production. Projections recently released by the Advanced Propulsion Centre show that the global lithium deficit in 2030 could see the expected manufacture of 40 million battery electric vehicles reduced to just 25 million in the most constrained scenario.
John Flint, CEO of UK Infrastructure Bank, added: “Globally the supply of lithium is far outpaced by demand, and yet in the UK 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 UK’s transition to net zero.”
The investment in Cornish Lithium comes just months after another British startup agreed a deal with a French mining company to extract 20,000 tonnes of lithium ore in Cornwall. British Lithium and Paris-listed Imerys aim to produce enough lithium for 500,000 electric cars per year by the end of the decade.
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