Target Information

The Investible Climate Tech Fund is pleased to announce its investment in Novalith, a Sydney-based company that has pioneered a patented process for the sustainable production of high-purity lithium carbonate, a critical component for lithium-ion batteries. Co-founded by Steven Vassiloudis, Christiaan Jordaan, and Dr. Andrew Harris, Novalith aims to revolutionize existing lithium supply chains through its innovative LiCAL™ direct lithium extraction technology.

Industry Overview in Australia

Australia stands as the world’s largest lithium supplier, producing 42,000 tonnes of lithium in 2019, primarily derived from hard rock spodumene, most of which is exported to China for processing. As the global demand for lithium continues to surge, driven by the electric vehicle market and renewable energy storage, the need for domestic processing capability has never been more critical.

In response to the increasing global demand for lithium, the Australian government has implemented the 2022 Critical Minerals Strategy, aimed at enhancing Australia's role in the global supply chain while retaining more economic benefits locally. Key initiatives in this strategy include a $200 million commitment to the Critical Minerals Accelerator Initiative and a $2 billion Critical Minerals Facility to assist strategically significant projects during their developmental phases.

The advent of the United States' Inflation Reduction Act, promising $369 billion for clean energy initiatives, further aligns with Australia's objectives. It introduces a 10% Advanced Manufacturing production tax credit across the lithium-ion supply chain, spotlighting the potential for Australian startups like Novalith to benefit substantially in their commercialization efforts.

Rationale Behind the Deal

The urgency for sustainable lithium production is underscored by a projected growth in lithium demand of at least 10 times over the next 20 years, according to the International Energy Agency (IEA). However, current lithium extraction methods are highly carbon-intensive, producing up to 20 tonnes of CO2 for every tonne of lithium carbonate. Novalith's LiCAL™ technology addresses this critical gap by significantly reducing carbon emissions and providing an efficient solution for lithium extraction.

Investor Information

The Investible Climate Tech Fund is dedicated to investing in innovative technologies that contribute to environmental sustainability. By participating in Novalith's Series A funding round of US$15 million, alongside prominent investors such as Lowercarbon Capital and the Grantham Environmental Trusts’ Neglected Climate Opportunities Fund, the Fund aims to foster advancements in the low-emission lithium production space.

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Investing in Novalith presents a remarkable opportunity to capitalize on the growing demand for sustainable lithium, particularly as the world pivots towards electrification and decarbonization. The company's LiCAL™ technology not only promises to lower the carbon footprint of lithium extraction but also positions Novalith at the forefront of an industry ripe for disruption.

The expertise of Novalith’s founding team, with deep roots in chemical engineering and industry experience, enhances the credibility of their business model. Their commitment to addressing not just current markets but also expanding into clay feedstocks showcases a forward-thinking approach to the evolving lithium landscape.

This investment aligns well with global trends towards sustainability and local resource processing and is poised to yield significant returns as the demand for lithium continues to expand. By backing Novalith, Investible Climate Tech Fund is not only investing in a promising startup but also contributing to Australia’s emergence as a leader in responsible lithium refinement.

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