On Wednesday, Stellantis (NYSE:STLA) and Vulcan Energy Resources (ASX:VUL), a lithium supplier listed in Australia, announced a new partnership with the objective to help the decarbonization of Stellantis' operations in Europe.
In a joint statement, the two companies announced that the binding agreement covers the first phase of a project to develop new geothermal sources contributing to the energy supply of an industrial site in Mulhouse, eastern France, where Stellantis produces several Peugeot and DS models, including the fully-electric Peugeot e-308.
Stellantis and Vulcan entered into a similar agreement earlier this year to collaborate on geothermal energy projects. The purpose of this collaboration was to support the production of electric vehicles at Stellantis' Rüsselsheim facility in Germany.
"Geothermal is one of many solutions we are exploring to achieve our carbon net zero goal by 2038," Stellantis' chief manufacturing officer Arnaud Deboeuf said.
The initial phase of the project, located in Vulcan's main area of interest in the Upper Rhine Valley, will involve conducting a study to build geothermal renewable energy resources for the Mulhouse facility. Additionally, the assessment will explore the potential for lithium production.
According to the companies, the renewable energy project, based on current assumptions, has the potential to meet a "significant portion" of the site's annual energy requirements starting from 2026. Stellantis and Vulcan have stated their intention to fund the development of the project on a 50-50 basis. They also mentioned their plan to explore the possibility of securing public funds in France to support the endeavor.
Shares of STLA are down 1.37% in premarket trading on Wednesday.