TVL: Lower CAPEX, Higher Uptime, Stronger Outlook

Alkemy Capital Investments plc ("Alkemy") (LSE: ALK) (JV2:FRA), 100% owner of Tees Valley Lithium ("TVL"), is delighted to announce major progress on its flagship lithium refinery, which is on track for Final Investment Decision in Q1 2026.

The FEED study has reduced projected CAPEX to $245m, boosted plant uptime by 5% without raising operating costs, and confirmed a project Net Present Value (NPV) of $475 million (GBP £350 million) for the first of four proposed trains, reinforcing the strong economic fundamentals of the refinery

Independent analysis by SC Insights International Ltd, confirms that TVL's CAPEX and OPEX costs are expected to be the lowest in Europe and globally competitive, with first production anticipated for early 2028 aligning with a rising lithium price cycle and surging European demand.

HIGHLIGHTS

• CAPEX reduced to $245m through modularisation and design optimisation, lowering upfront investment cost
• Plant availability increased by 5% to 90%, with no increase in operating costs, driving stronger profitability
• NPV of $475 million (GBP £350 million) post tax, post finance, for the first of four proposed trains, reinforcing the strong economic fundamentals of the business
• First production on target for early 2028, aligning with rising lithium prices and surging EV and ESS demand
• Train 1 production of 25,000 tonnes per annum set to supply 2.5% of Europe's battery-grade lithium needs, with future trains offering significant growth potential
• CAPEX and OPEX costs independently validated by SC Insights as expected to be lowest in Europe and globally competitive

FEED study by Wave and Veolia reducing Capex and optimising process route

The Train 1 Front-End Engineering Design (FEED) study is progressing well, with TVL working in close partnership with engineering partners Wave International pty Ltd, a leading process engineering consultancy with extensive experience in lithium projects, Veolia Water Technologies, a global specialist in modular process design with advanced crystallisation technology, and Gardiner & Theobald, who are providing project management and cost control expertise to support delivery of the FEED study.

The modularised approach has improved schedule efficiency and reduced the capital expenditure for Train 1 to $245 million. Optimisation has increased projected plant availability from 85% to 90%, without an increase in operating cost.

Process route design modifications have been made to accommodate a broader range of feedstock specifications, including the ability to incorporate recycled lithium inputs, supporting both circular economy principles and customer ESG objectives.

SC Insights confirms TVL as Europe's lowest cost refinery

Independent analysis by SC Insights (Lithium Battery Supply Chain Experts) confirms that TVL is expected to be the lowest-cost lithium hydroxide refinery in Europe on both CAPEX and OPEX basis, while also ranking as globally cost-competitive against leading producers.

SC Insights further forecasts that TVL's first commercial production of battery-grade lithium hydroxide in early 2028 will coincide with the next expected upturn in the lithium pricing cycle.

With European demand for battery-grade lithium projected to reach 1 million tonnes per annum, Train 1 is expected to supply approximately 2.5% of this market, delivering directly into a European customer base increasingly focused on sourcing local, traceable, and low-carbon supply.

The development of further trains at TVL represents the opportunity to significantly expand production capacity over time, strengthening the UK's role in the European battery materials supply chain and enhancing resilience in line with both UK and EU policy objectives.

Alkemy Chairman Paul Atherley commented:

"Lithium battery supply chain experts SC Insights has confirmed that TVL is expected to be Europe's lowest cost lithium refinery on both a capital expenditure and operating cost basis.

It has also confirmed that there is strong growing market demand for locally processed battery grade lithium in Europe which TVL is very well placed to meet. We are seeing this demand in the increasing interest in TVL's offtake from Tier 1 customers.

As we close in on Final Investment decision in early 2026 there is now palpable excitement about this important project being established in Teesside, with the region's expertise coming forward to contribute to the successful delivery of this world-class facility."

SC Insights Managing Director Andy Leyland commented:

"We're pleased to continue working with Tees Valley Lithium as an independent advisor, providing detailed market and competitor benchmarking to assess the project's position within a rapidly evolving lithium industry.

Our analysis draws on the latest cost, price, and demand data, and indicates that TVL is expected to be one of the lowest-cost lithium hydroxide refineries in Europe on both a capital and operating cost basis, while remaining globally competitive.

While market dynamics will continue to evolve, the combination of modular design, strategic location, and feedstock flexibility places TVL in a strong position to benefit from the next phase of market growth as demand for locally refined battery-grade lithium accelerates."