European Metals shares surge on new Cinovec service agreement

(Sharecast News) - European Metals Holdings announced on Tuesday that a 'value added services agreement' with KIC InnoEnergy - the primary facilitator and organiser of the European Battery Alliance - has been entered into by Geomet, for the Cinovec Lithium Project in the Czech Republic.
The AIM-traded firm said the project, a joint venture between itself and CEZ, was recently funded to around €29m (£26.43m), taking it through to the construction decision.

It said the purpose of the financing agreement with InnoEnergy was to support the construction financing and ultimate commercialisation of Cinovec - the largest hard rock lithium deposit in Europe - by InnoEnergy, providing assistance to European Metals to support the sourcing construction finance, in securing grant funding, and assisting in offtake introductions and negotiations.

European Metals said InnoEnergy leads the the European Battery Alliance, which was created by the European Commision in 2017 to encourage a "competitive and sustainable" battery cell manufacturing value chain in Europe.

Last week, the European Union approved the Green Stimulus Plan, agreeing to invest more than €500bn into a climate change plan, including electric vehicles and renewable energy.

Based on Cinovec's economics, long mine life and proximity to Europe's key manufacturing centres, European Metals said the project was "well-positioned" to work with InnoEnergy and other European organisations, to ensure timely development to assist in meeting the expected significant increase in demand.

"European Metals and its development partner, CEZ, look forward to receiving support from InnoEnergy and working together closely with their industrial and financial partners to deliver production at Cinovec, and contribute to a sustainable supply chain for a world leading centre for electric vehicle development and manufacture in Europe," said executive chairman Keith Coughlan.

"Cinovec is the largest hard rock lithium resource in Europe and is strategically located to produce lithium in Europe for Europe."

Coughlan said the requirement for locally-sourced raw materials for the e-mobility movement had become more apparent during Covid-19, with Cinovec "well-positioned" in close proximity to Europe's manufacturers.

"Over the coming months we look forward to commencing the definitive feasibility study work programmes, and subsequent permitting and construction of Cinovec."

At 1049 BST, shares in European Metals Holdings were up 24.91% at 19.05p.