Kanoa and Regional Strategic Partnership Fund makes its first investment in New Zealand sustainable minerals company Geo40 Ltd
Economic and Regional Development Minister Stuart Nash MP announced today that the New Zealand Government’s Regional Strategic Partnership Fund will make a $2m equity investment in Taupō company Geo40’s programme to further progress its direct lithium recovery technology. The fund is administered by Kānoa, the government’s relaunched regional economic development investment company.
Geo40 develops processes to sustainably recover strategic minerals from geothermal fluids and currently operates two plants at the Ohaaki Geothermal Power Station (North Island of New Zealand) that recover colloidal silica nano-particles from the hot geothermal fluid used to generate electrical power. The Company has been working on a new process to source lithium from geothermal and other similar fluids, for the EV battery market.
The Kānoa investment follows the 2019 $15m loan by the then-named Provincial Growth Fund (PGF) into Geo40’s first large-scale silica plant (Ohaaki Northern Plant), which was commissioned in early 2021. The Provincial Growth Fund subsequently converted $5m of that loan into an equity stake in the Company in 2020. Kānoa Regional Development Unit (Kānoa RDU) announced its intention to invest further in Geo40’s lithium programme in 2021, however closing has been repeatedly delayed by reoccurring Covid-19 issues. CEO John Worth noted that Kānoa’s ongoing commitment to supporting the Company, and the subsequent support from New Zealand venture firm Pacific Channel allowed it to push forward significantly with its lithium programme through 2021.
Worth noted the symbolic significance of the Regional Strategic Partnership Fund’s first investment being in Geo40. “We’re thrilled that the Government (via Kānoa) has now finally been able to formalise this investment and shown their trust in us. We’re aiming to deploy our silica and lithium technology offshore where the symbolism of the New Zealand Crown as an investor will be highly relevant.” The Company has received interest from a number of global lithium resource explorers and is currently evaluating potential partnership options.
Kānoa – RDU’s Investment Director David van der Zouwe highlighted the role the New Zealand Government can play in such ventures. “The investment is designed to further leverage the Taupo region’s natural advantages and diversify its geothermal sector. By working with the likes of Geo40 and the landowners and kaitiaki Ngāti Tahu Tribal Trust, we are confident this programme will add to the reputation of the region and New Zealand as a leader in geothermal technology,” David van der Zouwe said.
Geo40 has already successfully trialled its lithium recovery technology at laboratory scale on geothermal fluids from Europe and Argentina. It successfully recovered lithium from geothermal fluid at Ohaaki in 2020, but concedes that lithium concentrations in geothermal fluids in New Zealand are generally quite low, hence the current focus on overseas opportunities.
Geo40 will construct a lithium pilot plant in the coming months and plans to trial lithium recovery from a range of global brines from around the world to validate the adaptability of its Direct Lithium Extraction (DLE) technology on a variety of geothermal fluid chemistries. The Company hopes to do this work at Ohaaki near Taupō, where it works closely with landowner and kaitiaki (guardians), the Ngāti Tahu Tribal Lands Trust and Contact Energy.
Geo40 is a privately held New Zealand Company with over 350 investors, including Pacific Channel and Swedish geothermal investor and operator Baseload Capital. Bill Gates’ climate change fund Breakthrough Energy Ventures invested in Geo40 in 2020 via Baseload Capital.
For further information contact John Worth, CEO & Managing Director
