Alkemy Capital Investments (LSE:ALK) said Front-End Engineering Design (FEED) work has been completed for its proposed Teesside lithium hydroxide refinery, reinforcing the project’s low-cost, high-margin credentials. The study confirms planned capacity of 25,000 tonnes per annum of battery-grade lithium hydroxide, with estimated capital expenditure of US$243.6m and forecast annual EBITDA of around US$65.9m, supporting a compelling economic case ahead of a potential Final Investment Decision.
According to the FEED outcomes, annual operating costs are estimated at US$33.2m, positioning the refinery towards the lower end of global capital and operating cost curves. The company highlighted several de-risking factors, including ownership of the site, a modular plant design, established infrastructure links and project readiness to progress to the next development stage. Strategic credibility is further underlined by a binding offtake agreement covering up to 40% of initial output with a subsidiary of Glencore, supporting the refinery’s role in easing Europe’s shortage of lithium conversion capacity and strengthening regional battery supply chains.
Despite the positive project-level developments, the wider investment outlook remains constrained by weak group-level financials. Alkemy continues to generate minimal revenue and report losses, alongside negative cash flow and equity and rising debt levels. These factors point to ongoing funding risk, although share price momentum has been strong, with technical indicators remaining supportive. Valuation offers limited downside protection, however, given negative earnings and the absence of dividend information.
More about Alkemy Capital Investments Plc
Alkemy Capital Investments Plc is developing a lithium hydroxide refinery in Teesside, UK, through its wholly owned subsidiary Tees Valley Lithium Limited. The project is designed to supply battery-grade lithium chemicals to the rapidly expanding European electric vehicle and battery manufacturing markets. Using established Veolia technology, the refinery is intended to operate as a flexible merchant facility, offering feedstock optionality, a lower-carbon supply profile and capital-efficient expansion to meet rising demand from UK and European gigafactories.
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