2nd Jun 2025 13:00
(Alliance News) - Alkemy Capital Investments PLC on Monday confirmed funding for its Tees Valley lithium project and reported optimism ahead of the final investment decision.
The London-based, critical minerals-focused investor reported GBP250 million in capital expenditure for the project, which is located in Teesside, UK, and aims to become "Europe's largest low-carbon merchant lithium refinery".
"Having made significant improvements in the engineering design, reduced operating costs and substantively advanced key commercial contracts, momentum is building towards a final investment decision in the fourth-quarter of 2025," Alkemy said.
The company's shares jumped 18% to 153.90 each following Monday morning's announcement in London.
The firm's test work has indicated that the site contains battery-grade lithium hydroxide, and Alkemy has begun talks for an offtake agreement with a European battery cell producer. Equipment tendering is currently underway through engineering consultant Wave International Ltd.
Additionally, Alkemy noted an improvement to the project's financial structure. Net present value after tax is estimated at USD764 million, with an internal recurring revenue rate of 41% and three-year paypack period.
Back in May, Alkemy signed an exclusivity deal with Ara Advisors LLC, a Houston, US-based private equity firm, giving Ara the sole right to negotiate a strategic investment in the project subsidiary, Tees Valley Lithium Ltd.
Alkemy still needs to finalise the project's piping design, cost model and execution strategies, before selecting contract partners.
Tees Valley is on track to reach a final investment decision by the end of 2025, the firm said, with production scheduled to begin in 2027.
By Holly Munks, Alliance News reporter
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