Infinity Lithium (INF) - €750Bn European Battery Eco-System Fund Focus

Infinity Lithium is an Australian listed minerals company that is seeking to develop its 75% owned San Jose Industrial Lithium Project located in Spain. The project will be developed by open-pit methods with the ore treated and refined onsite to produce high quality, battery-grade Lithium hydroxide. 

We met with Ryan Parkin, CEO of Infinity Lithium, a European Lithium story as part of our ‘Lithium week’.

Company Overview

Infinity Lithium's focus is solely on the San Jose Valoriza project which is Europe's second largest hard rock resource and they are aiming to convert the ore on site to battery grade Lithium hydroxide for the European market.

EU's Lithium Ecosystem: The Market & Getting Financed 

EIT InnoEnergy has been very important to Infinity Lithium and have provided direct investment in terms of facilitating their technology and processing flowsheets with funds aligned to the test programme in Germany at the moment. There is now an influx of activity into the Lithium market with different funding opportunities and support available throughout the entire Battery Value Chain aiming to develop the European market. Infinity Lithium is a component of that alongside a number of other Lithium projects and recycling will also be a key component in the European market.

Infinity Lithium has just announced that they're part of a consortium and aware of the €750Bn on offer through the Coronavirus Recovery Fund which is allocated to projects such as San Jose.  Spain is expecting €140Bn of that fund and the San Jose project is a contender to receive some funding as an important participant in the battery and sustainable chain with InnoEnergy really championing that cause for Infinity Lithium.

In addition to the Coronavirus Recovery Fund, there is also the European Investment Bank that's focused in stepping away from fossil fuel projects and has specifically focused on Lithium extraction but more importantly downstream conversion.  For projects such as San Jose, it's all about their strategic value and political alignment.

Maintaining Investors' Interest: Approach to Growth, Preparation & Plan

The macro thematic is getting recognised in the marketplace which is good news for companies like Infinity Lithium. They have just seen an increase in their share price up to around USD$0.17 from below USD$0.10.  The market is starting to wake up to the opportunity of not purely supporting a resources project but actually participating further downstream.  Infinity Lithium aims to be fully integrated and will be controlling an end product that's critically important for Europe and this is crucial when considering what markets are looking at.   

Infinity Lithium is currently developing the process flowsheet with EIT InnoEnergy in Spain.  They will work through the test work programme and continue to deliver their technical studies.  Moving into the renewable space, it is all about ESG and Europe in particular is starting to put up barriers to entry.  They're going to be fining and taxing new entrants into the market from coming outside of the European Union so it's going to be a very logical progression.  Infinity Lithium will add value to the project technically through permitting and the technical studies but also aims to attract the larger players who will inevitably require vast volumes of hydroxide.  

In addition to chasing EU funding, the company has also recently raised USD$15M and they were very strongly supported in the market, a number of institutions have joined their share register through Europe as well.  Infinity Lithium realises the importance of really making this a European story moving forward to give them the greatest chance of success.  

ESG Component: Concerns Over the Betterment of Local Relations 

Infinity Lithium are involved involved with the European Battery Alliance, attracted the interest of EIT InnoEnergy and has received support from the highest levels of the Government in Spain and are now starting to focus more locally. There have been some objections from local residents regarding the mine which has been a long running problem for the company. This project is an opportunity to use the asset to attract other industry to the locality which is critically important as it is a region with more than 20% unemployment before COVID and huge depopulation issues. They need to engage the local community which is where they are focusing their efforts to affect change in sentiment and help locals gain a greater understanding of the benefits of the project.

Until now, the local community has not necessarily understood the opportunity downstream for the future of the area. There are great opportunities for the next generation coming through, with multi-decade, skilled jobs available. The Lithium mine battery chain could also attract other industry to the region.

Team Experience & Focus 

Infinity Lithium has hired a local, ex-politician who is actively engaged with the local community. He is also an environmental engineer. They have also employed two other technical people who have been involved in recent conversion plants.  

Developing Ecosystem: Barriers to Entry & Bifurcated Pricing

Infinity Lithium is one of very few lithium, potential lithium producers in Europe and are keen to know that there will be some form of protectionism applied to that supply chain. The European Commission has already implemented some barriers to entry with fines and penalties applied to protect the market and a stamp on that battery based on where those chemicals are sourced.

Hopes & Expectations for 2021

The test work programme is well underway in Germany and once completed, data will be available to lodge the mining licence application and environmental impact assessments (EIA).  There are some key milestones for Infinity Lithium before the end of the year and then obviously progressing through to complete the DFS into next year. 

It is important that the company get the support of the local community for the project, so they need to engage with them to assist them in understanding the benefits. Infinity Lithium has allocated some of their recent raise to educating that community and to help them understand what it is that they are trying to build. There are 35,000 flyers going out this week to the local population. Long-term, they want to be able to provide a royalty and have those funds allocated to infrastructure and improvements in Caceres for the local community.

It was good to hear the Infinity Lithium story and we look forward to hearing more from the company as 2021 progresses to see how they get on.

To find out more, go to Infinity Lithium's Website.