The major automotive company Stellantis (NYSE: STLA) is investing over US$100 million in a carbon-neutral California lithium project owned, operated and currently being developed by the renewable energy company Controlled Thermal Resources (CTR).
Stellantis announced the investment in the Imperial Valley’s Hell’s Kitchen project on Thursday and has expanded on a supply agreement between the two companies signed last year. CTR will now be providing Stellantis with 65,000 metric tons of battery-grade lithium hydroxide monohydrate (LHM) annually over a 10-year period taking effect in 2027 — a 40,000-ton increase from the 25,000 agreed upon last June.
The companies say this is the world’s largest geothermal lithium project, which recovers lithium from geothermal brines 8,000 metres below the ground using steam and renewable energy. The recovery process CTR utilizes doesn’t require evaporation brine ponds, fossil fuel-powered lithium processing or an open pit like other operations.
“With electric vehicle (EV) adoption growing rapidly in the United States and throughout the world, it has never been more important to ensure battery materials are sourced and produced responsibly,” said CTR’s CEO Rod Colwell.
CTR says the Hell’s Kitchen project is expected to create 480 construction jobs in the coming years and more than 940 jobs once it is fully developed. It is expected to be capable of providing 49.9 megawatts of clean power next year and 1,100 MW annually once it is operating at full capacity.
Production process. Image via Controlled Thermal Resources
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Stellantis has actively been investing in copper needed for EVs as well in recent days and put $120 million into McEwen Mining Inc. (NYSE: MUX) (TSX: MUX)’s Loz Azules copper mine in Argentina earlier this year.
The company also announced at the end of July that it had purchased a 33.3 per cent stake in the hydrogen company Symbio for an unspecified amount, a joint venture between Michelin and Forvia SE (EPA: FRVIA).
The future supply of lithium from CTR will assist with the Dare Forward 2030 strategic plan developed by Stellantis for accelerating production of electric vehicles in Europe and the United States. The company aims to have 25 new electric vehicle launches and 50 per cent of its sales derived from EVs by 2030.
Stellantis shares dropped by 0.9 per cent Thursday to US$17.75 on the New York Stock Exchange but have steadily risen by over 21.5 per cent since the beginning of 2023.
rowan@mugglehead.com
