The Vulcan Energy Resources Ltd (ASX: VUL) share price was on form again on Monday.
The clean lithium producer's shares climbed 3% to $7.60.
This means the Vulcan Energy share price is now up an incredible 174% since the start of the year.
Why did the Vulcan Energy share price race higher?
Investors were buying Vulcan Energy shares on Monday following the release of an announcement relating to a new acquisition.
According to the release, the company has signed a binding agreement to acquire 100% of Global Geothermal Holding (GGH), subject to shareholder approval.
The release notes that GGH is Vulcan Energy's joint venture partner holding the granted Taro license in the Upper Rhine Valley. It is also the holder of Ludwig and Hesbach exploration license applications.
In respect to the Taro license, Taro has a joint ore reserves committee (JORC) resource estimation of 2.27 Mt contained Lithium Carbonate Equivalent (LCE) at a grade of 181 mg/l Li. This is approximately 14% of the estimate resource across the Vulcan Project.
Management notes that this acquisition consolidates its major strategic holding in the Upper Rhine Valley, as part of the plan to rapidly advance the Zero Carbon Lithium project towards production.
What are the terms?
Under an existing agreement with GGH, Vulcan Energy has already earned a 51% interest in the Taro license by spending 500,000 euros in exploration expenditure on the license. It also has the right to spend a further 500,000 euros in exploration expenditure on the license to earn a further 29% within two years to take its joint venture interest to 80%.
However, the company wishes to accelerate and move to full ownership of these licenses and will now do so via a payment of $90,000 worth of Vulcan shares and deferred consideration of $720,000 worth of performance shares.
Vulcan Energy's Managing Director, Dr. Francis Wedin, commented: "By acquiring 100% of GGH, we are consolidating ownership of the Taro and other exploration licences, which simplifies financing and development of our large strategic position in the Upper Rhine Valley. This consolidation is an important part of our strategy to become a major supplier of our unique Zero Carbon Lithium hydroxide to the European battery electric vehicle market."
Judging by the Vulcan Energy share price performance today, investors appear pleased with this development.
