Vulcan Energy Gains Analyst Confidence as Construction Phase Begins

Institutional research coverage of Vulcan Energy is intensifying following two key developments: the commencement of construction for Phase One of its Lionheart project and the finalization of a multi-billion dollar financing package. Market experts have reaffirmed bullish ratings and, in some cases, issued significantly higher price targets. The company's ability to adhere to its ambitious timeline toward first production is now the central focus.

The foundation for the current construction phase is a comprehensive €2.2 billion (approximately A$3.9 billion) financing package, which was finalized in December 2025. Vulcan announced the completion of this structure on December 3. The package encompasses senior debt financing from the European Investment Bank and other commercial lenders, combined with government grants and equity. This fully covers the capital expenditure required for Phase One.

Operationally, the company is building upon results from its pilot programs. A pivotal milestone was achieved on January 13, 2025, with the first production of battery-grade lithium hydroxide monohydrate (LHM) at its Central Lithium Electrolysis Optimization Plant (CLEOP) in Frankfurt. The company states this is the first fully European-produced lithium hydroxide.

This success demonstrated the functionality of Vulcan's proprietary Adsorption-type Direct Lithium Extraction (A-DLE) process. Throughout 2025, the product underwent extensive qualification with offtake partners including Stellantis, Renault, and LG Energy Solution. This groundwork has now led to the signing of binding commercial supply agreements.

Analyst Perspectives Highlight Transition

This reassessment by the market is supported by the start of major construction activities. With funding secured and permits in hand, Vulcan is advancing its plan to establish the world’s first integrated Zero Carbon Lithium™ supply chain.

Recent analyst notes reflect growing confidence. In a report published yesterday, Bell Potter confirmed its "Speculative Buy" rating for Vulcan Energy, assigning a price target of A$6.10 per share. The firm cited the project's "development-ready status" and its strategic location in Europe as central arguments.

Earlier, on January 7, Canaccord Genuity raised its price target to A$10.00. Both assessments point to the company's transition from the development stage into the execution phase, underscoring belief in the path to commercial production.

Should investors sell immediately? Or is it worth buying Vulcan Energy?

Key Data Summary:

• Bell Potter Rating: "Speculative Buy," Target: A$6.10
• Canaccord Genuity Target: A$10.00
• Lionheart Phase One: Financing fully secured
• Total Financing Package: €2.2 billion (~A$3.9 billion)
• Target: First commercial lithium production from 2028

Strategic Positioning Within European Policy

Vulcan's progress occurs against the backdrop of tightening European regulations for critical raw materials. The EU's Critical Raw Materials Act (CRMA) is increasing pressure to establish local, low-carbon supply chains.

The company's "Dual-Revenue" model, which combines geothermal renewable energy with lithium extraction, is designed to reduce reliance on pure commodity price cycles. Simultaneously, it addresses the stringent CO₂ limits imposed on the European automotive industry.

Vulcan's share price has recently stabilized around the A$4.50 mark. This stability is attributed to the official start of construction and the positive analyst commentary. Observers note that with financing clarified, share price movements will likely be more closely tied to construction milestones and broader lithium market trends.

Roadmap to First Production

The immediate focus is the execution of Phase One of the Lionheart project, with construction expected to take approximately 30 months. The company is targeting the start of commercial lithium production in 2028.

Near-term catalysts may emerge from further details on the planned expansion phases for Lionheart. Additional offtake agreements are also possible once the qualification of V-Li0N™ samples with remaining partners is finalized. Consequently, the coming years will be primarily defined by construction progress, the depth of contracts with customers, and the technical scaling of the A-DLE process.