Welcome everyone to the AGM today. Thanks very much for taking the time to be here. Much appreciated. I'll just take you through some of the things that have happened during the course of the year and where we see things progressing for the next 12 months. Next slide, please. Just a reminder of what we're trying to achieve. I think this summarizes it quite nicely. Really targeting, well, a combination of things with our fully integrated project. Renewable heat production for more than one million people by 2030 as we grow stepwise across the Upper Rhine Valley, and we grow those geothermal production facilities. Enough lithium hydroxide production from those those wells from that field for one million EVs per annum.
This is based off the production capacity that we're working with. In doing so, really the original core mission for Vulcan, avoiding around one million tons of CO2 per annum. That's both from the renewable energy side and also the lithium side as well. Next slide, please. Just a bit of a summary here. Apologies if you can't read this. The text is quite small. Just a bit of a summary of where we've got to over the past year. Really it was a transformational year for us. We entered the ASX 300s, which was a very good milestone. Sorry, there's a bit of feedback there. Mic okay? Yep.
We started off with a fairly significant capital raise as well, which was followed up by a further capital raise with Stellantis this year. Well capitalized for the future. Is the mic okay? I seem to be getting a bit of. Is that okay? Yep. What was also unique about Vulcan over the course of the year as well is we signed five binding lithium hydroxide offtake agreements with really some of the cream of the auto, the battery, and the cathode manufacturing industry. Stellantis, Volkswagen, Renault, Umicore, and LG Energy Solution, all of whom have operations or are building operations in Europe. Really, some tier one companies in the European battery space.
As Gavin mentioned, we listed on the Frankfurt Stock Exchange as well on the Prime Standard. We acquired our first geothermal energy plant as well, so we've transitioned from, also from developer to producer with that acquisition, and that provides us with a springboard to build further production capacity from that core of the field. We've also expanded into both Italy and France. France in particular is interesting because it's basically the same resource. It's the same brine field. It means we can leverage our experience in the Upper Rhine Valley brine field as we expand in a stepwise fashion. We signed our first heat offtake agreements as well, which I think is a sign of more things to come.
More recently, in the last few months, we've had an exciting announcement on our VULSORB development, which is our own lithium extraction technology. Bringing control of our destiny for lithium extraction, which is a very niche set of skills, fully in-house, so we don't have to outsource that. Also some important developments in terms of start of construction of our on-site demonstration plant as well, which is the next evolution after our pilot plant. Really a very busy year. We also established our in-house drilling team as well with the acquisition of two rigs. That's a very important strategic asset for the company to have as we build out these renewable energy projects going forward. Next slide, please. Again, please.
Why is this right place, right time? This is a really rapidly evolving space. It's really interesting actually. Every time we pick up a newspaper, we see some developments which directly affect the evolution of our company. Really, I mean, we do two things. We do renewable energy, and we do lithium, both really exclusively for the European market. In Europe, we see this dynamic where there's more and more slated lithium-ion battery manufacturing capacity announced. Every time we see an announcement, the manufacturing capacity seems to be getting bigger, that's really driven by the ambition of the EU to go fully electric for transportation by 2035. That's driving enormous investment, which is happening on the ground now in Europe to produce its own batteries.
Europe wants to produce its own batteries for its own transportation, for its own electric vehicles going forward. This is making Europe really the fastest-growing lithium market in the world, certainly for the next 10 years. It is entirely reliant on imports. In terms of lithium hydroxide, around about 90% reliance on China. The majority of European auto manufacturers want to use lithium hydroxide for the higher performance NMC cathode batteries. That current supply of lithium is CO2 intensive and as well as being self-reliant in terms of battery supply chain, EU also wants to produce the greenest batteries in the world. The current supply chain is really not fit for purpose for the European auto industry. To that aim, we obviously have our project right in the center of that market.
It is the largest lithium resource in Europe, and it has a lot of scope to grow as well, so we hope to be able to update our shareholders on that in the weeks and months to come. We have our large lithium resource, which is already the largest resource, lithium resource in Europe, but we see a lot of scope to grow that with the newly acquired licenses. So this is a very strategic asset for that European market, this really fast-growing lithium market. We are developing the only CO2 neutral, zero fossil fuels, what we call our Zero Carbon Lithium project. It's the only one of its kind in the world. So a very strategic asset for Europe. Next slide please. Then we have the energy situation.
The other thing that we do is renewable energy production. At the moment, renewable power, increasingly we see the future as being renewable heat going forwards. The ambition is there, Europe wants to decarbonize its energy. They want to do it very quickly. This has been further accelerated by the very unfortunate events with the invasion of Ukraine in February, and then the subsequent closure of certain gas pipelines going into Europe from Russia as well. The need for, well, heating in general, energy in general, but in particular renewable heating, has just really increased exponentially in Europe, particularly in Germany.
We have the ability with geothermal heat to replace gas in certain situations, particularly for heating needs, for instance, for space heating, and for certain types of industrial heating as well. Geothermal is really uniquely positioned. It has been a very small player in the renewable energy market in Germany until recently. It is a much larger player in some other jurisdictions around the world. This is really geothermal's time to be able to capitalize on this. The ambition is there. The German government wants to build 100 new geothermal projects by 2030. That's a lot. Fraunhofer, the Fraunhofer Institute, one of the most respected research institutes in Germany, calculates that geothermal energy can meet a quarter of Germany's heating needs.
Very large capital investment is required, and we want to be a part of this. This is a really rapidly evolving situation, and I think the needs for our project, has really been highlighted with these geopolitical events in Europe. Europe really knows now that it needs to produce as much of its own energy as possible, and it needs to secure as much of its own battery raw materials as possible, which are critical to the auto industry, which is really the largest industry, certainly in this part of Europe. Next slide, please. This we see as being a solution. This is our Zero Carbon Lithium project. You can see kind of the outline of the Upper Rhine Valley there. It's 300 km long, it's about 30 km wide.
Highlighted in the golden part of the map there is what we call the Buntsandstein. This is our main reservoir unit, which we target. Average lithium grade from this ran about 180 mg/L lithium. This is what we say is the basis of our resource, which is Europe's largest lithium resource. It is strategically located at the heart of this European battery industry. You can see just how close we are. Kaiserslautern you can see on the left there, that's currently the home of Opel in Europe. Opel is intending to build as part of Stellantis, obviously as part of the Stellantis brand, they're building their gigafactory there with ACC.
You can see we really are in the heart of that battery industry for EVs. Just up the road is Stuttgart, obviously very famous, home of the German auto industry. We really, we couldn't be closer to our customers if we tried. You can see here the scope of our projects really stretch across the Upper Rhine Valley, and hopefully we'll carry on growing into the future as well. You can see there in the center of your screen the Insheim plant, which we bought during the year. Landau-Zweibrücken we have a brine offtake agreement with, that also happened during the course of the year.
This is the producing core of the field, and we really intend to expand north and south in a, in a stepwise fashion, so we can grow in a modular fashion as the market grows. You can also see Mannheim there where we have the renewable heat offtake agreement with MVV, which is Germany's largest renewable largest municipal energy supplier, sorry. You can see our license areas going north and south, which the intention is to produce both the lithium chlorides and the renewable energy from as we grow this. Herx, you can see at the top, we secure the site there, which is actually quite difficult to get. Space is very limited in European chemical parks.
We've secured a site there for our chemical plants, what we call our CLP, our central lithium plant. That will be the producer of the lithium hydroxide, which will be sent to our offtakers from there. Really a hub-and-spoke model, the hub being in the center, or sorry, the north of the field, and the spokes of the wheel being these combined lithium extraction and geothermal projects. Next slide, please. Again, please. This is just another visualization of it, just sort of looking up the valley, so you can get an idea of what we're trying to do. We have these multiple wells, which will be feeding these combined renewable energy, so geothermal plants and lithium extraction plants. You see there, red is geothermal.
Light blue is what we call our adsorption plants, our lithium extraction plants. These each will be fed by multiple producing wells in the field and will feed back to reinjection wells. It's a closed system. Everything as much as possible fits with the EU's circular economy goals. You can see here, we're sort of roughly at the Insheim power plants and looking north. This will sort of constitute our Phase 1 areas, and then we have Phase 2 and perhaps Phase 3, Phase 4 going forwards as we build out in that stepwise modular fashion. Next slide, please. A graphical sort of representation of this as well. You can see a picture of Insheim there, which we bought during the course of the year.
You can see in the background there. The vineyard surrounding Insheim. So the geothermal plant is really well integrated into the local environment, and you can see very, very small footprint indeed. Really we just want to build more of these plants with the lithium extraction attached to it. So we think this represents a sort of a modern take on mining, if you like, for lithium, which is suitable for Europe. Obviously very difficult to build actual real sort of mining projects with pits in Europe. You can see from there, we will be transferring the brine to the lithium extraction plant. We also supply heat, we supply steam, we supply power, and this drives the lithium extraction process.
From that adsorption plant, we send the lithium chloride up to the lithium hydroxide plant where the lithium is produced, once again using green power. Next slide, please. I just wanted to talk about the different areas of our business. We are building a fully integrated company. This is what makes Vulcan quite unique and enables our claim of Zero Carbon Lithium. What we're aiming to do is not just to build out the lithium extraction, but also the renewable energy production, which handily also sort of fits the production, if you like, the mining parts, the geothermal, the wells. We're also developing the refining parts of the process as well. It really is a fully integrated company. We have a very good understanding of the subsurface.
We've acquired an engineering company, a subsurface geothermal engineering company, which we now call Vulcan Energy Subsurface Solutions, and they have decades of experience in the company of developing these types of geothermal projects. Interestingly, we're also recruiting a lot of people from the oil and gas industry. As part of that just transition, really redeploying their skills. We're very grateful for that help because, you know, there's some very, very smart people in the oil and gas industry who are coming in and helping us with our reservoir engineering. You can see here a bit of a schematic, very simplified schematic, obviously, of how the process works.
You can see, what it looks like when we model our resource in three dimensions using the 3D seismic, using the information from the existing drilling. This is what the projects look like in terms of generally one location on the surface with multiple wells spreading out from each location. It's a very mature field, what we're developing. There are multiple producing projects which have the brine coming up to the surface. That's shows us that the brine is very, is very homogeneous across the Upper Rhine Valley. That helps with really sort of a print and repeat system with the lithium extraction plants, which is what we intend to do. Lithium grade's proven to be consistent over space and time within the reservoir.
Next slide, please. We also have the drilling part in-house as well. As I mentioned, we've acquired two drill rigs. You can see the rigs on the screen there. They're currently undergoing refurbishment, and these will be drilling the developments wells, so the production, the reinjection wells, next year, hopefully from Q2 onwards. Refurbishment is underway. We may also look to add more rigs in the future, because we see these as being a very critical part of our development, you know, really for the next 10 years as we aim to grow in a stepwise fashion. These rigs are quite rare in Germany, so the availability is very tight. We looked at our schedule, and we recognized that the availability was potentially an issue, so we wanted to have control of this in-house.
Bearing in mind that Germany wants to develop 100 geothermal projects by 2030, having a couple of only a handful of available rigs that can drill to these depths in-house is a really strategic asset for Vulcan for the company as well. We're very pleased to have them on board, and we're building up our drilling team in-house. Interestingly, again, we're seeing employees coming from other companies really because they really like the message of Vulcan and what Vulcan is trying to do. The Zero Carbon Lithium message is also a real recruiting tool in this industry. We have our drilling company, which we call in-house, we call it Vercana. I think that will be a very strategic asset going forwards. Next slide, please.
We also have, as I mentioned, the geothermal plant. This is operating at the moment, and is host to our pilot plant for lithium extraction, which has moved between a couple of plants over its time, demonstrating that the brine is very homogeneous. We have a lot of good data from about 19 months now of pilot plant production for lithium extraction. And this, as I said, is part of a production license for geothermal, and we see this as really being a springboard, as I said, for future developments going forwards. We have an operations team there, and we intend to use that operations team as a basis for further growth as we build further geothermal projects in the area. Next slide, please.
In terms of our plans for future geothermal plant developments as well, as I mentioned, it's gonna be much more about heat going forward because local communities can see the tangible benefits of the heat production directly flowing into the local area. It's not just electrons going into the grid, it is, you know, district heating, and they can see the direct benefits of that. Really, it's a lot easier to decarbonize power and to do it cheaply than it is to decarbonize heating and do it cheaply. Geothermal is uniquely positioned to do this, and we see this as a unique strength of geothermal. This enables more lithium production.
The more heating projects we do, generally we get a lot of support from the community in doing these heating projects. That means we can go into this area, and we can also extract the lithium as well, which is one of the main drivers of our business model. Heating very important for Vulcan going forwards. Next slide, please. We come to the lithium extraction part. Once again, we're not reliant on external technology providers. We've really built up this expertise in-house. We have a fully functional laboratory which is now expanding, again, with all the analytical equipment that we need in-house, so we don't have to rely on external analytics.
We've built now two pilot plants, so we have a non-pressurized one and a pressurized one, both running, both at the Insheim geothermal plant. We've developed our own sorbent in-house, so this is the same really, the same family of sorbents as was originally developed by Dow in the 1970s. It's very well-known technology. There's only a handful of producers in the world of this sorbent, and most of the current supply chains are in China or Russia. We wanted to bring this in-house and actually produce our own sorbent, and have control over our own destiny.
The sorbent is partly made out of lithium as well. Once we've done our first fill for the plant, there is an opportunity to use some of our own lithium and thus reduce costs of that sorbent production. We'll be replacing around about 10% a year of our sorbent in the commercial plant. What that means is having that in-house, we have much more control over our destiny and control over our OpEx going forwards as well. This is also an asset for the company. We think, going forwards, having that IP in-house, we can also take that to other brine fields as well. We have our hands full very much in the Upper Rhine Valley at the moment. Medium-term, long-term in the future, we can look to apply this know-how elsewhere as well.
Next slide, please. Also to mention that we are currently building our demo plant for lithium extraction, for the same thing, for the sorption to take the lithium out of the brine. This is really the lithium extraction process. We're in the concluding stages of our definitive feasibility study, also for this same plant design, obviously for a commercial plant. Really once that DFS is out of the way, we're looking at starting to secure. We'll be in a bridging phase, but we'll look to start to secure long lead items for the commercial plant. That'll happen next year. That'll happen quite quickly. The reason we're moving very quickly on that is because we see that certain items have a very long lead time now for delivery.
That's really changed in the last year with the situation with supply chains due to Russia and Ukraine and due to COVID as well. We need to move quickly to make sure we meet our timelines. Next slide, please. Just a brief mention as well, in terms of using this type of lithium extraction. We are in good company, sorption is used in the lithium industry, by multiple commercial projects. You can see sort of on the left side of us there's three projects in China. There's one project in South America. The project in South America has been working since the late 1990s. This is a commercially very well-proven technology which we are adapting to our brine, our brine chemistry.
You can see there's a whole host of development projects which are also using sorption, including Rio Tinto's project in Argentina. As you can see there on the screen, there is quite a heavy Chinese and Russian influence on that supply chain. Once again, that's the reason for bringing the control of that sorbent IP and production in-house. Next slide, please. Then we come to the lithium hydroxide production part. You can see our plot there on the screen. That's the Herx Chemical Park. We've got quite a large plot there which we've secured. We'll have a demonstration plant there next year, which we call LiLy, which will be training our operations team in a pre-commercial environment. We're also obviously doing the DFS for this plant as well.
In addition to that, we'll be looking at long lead items for the commercial plant next year as well. We have an agreement with a company called Nobian, so formerly part of AkzoNobel. They are a chloralkali producer, and this process is very similar to the chloralkali industry. It basically uses the same cells. The operations of this plant, we recognize that Nobian has a lot of expertise in this space, so potentially a good partner for us in the future. To be continued. Next slide, please. Just on the lithium hydroxide offtake agreements, I touched on them before. This is a series of major milestones during the course of the year.
We have Volkswagen, Germany's largest company, backing us now with this binding lithium hydroxide offtake agreement. Stellantis, that investment represented the first equity investment in a listed lithium company by a top-tier OEM. We're very proud to have Stellantis as 8% shareholder in Vulcan. Once again, very important strategic partner for us. Stellantis is Opel in Germany. They are Peugeot Citroën in France and a whole host of other brands globally. A very large backer of Vulcan. Renault also very important. Obviously very close to close to the French state, a very important company in France. Important to have them as offtakers as well. LG Energy Solution, one of the largest EV battery producers in the world.
Umicore, one of the only cathode producers in Europe, so the direct user of our product. Very important to have them in because they'll provide a lot of technical feedback to us on the product that we provide. Umicore already will be supplying cathode to a lot of these actors in the supply chain anyway. Really a stellar cast of offtakers that Vulcan has managed to secure. Next slide, please. Just a bit of a schematic on what our project will look like in a commercial setting. This is what we're working on, the definitive feasibility study at the moment. You can see here, Phase 1 on this side. You have multiple geothermal plants, including the existing one. We'll have two lithium extraction plants supplying Phase 1 of the electrolysis plant.
You can see here you've got the reservoir, you've got the wells, the geothermal plants, the lithium extraction plants, and the central lithium plants all within one integrated project. There's a lot of moving parts, but this integration also provides us with a lot of leverage and a lot of strength. We have Phase 2 then as well, which will be the next stage of our development. This will be outlined in what we call a sort of a PFS plus, a pre-feasibility study for Phase 2, which will come out shortly after the definitive feasibility study. We've already done a pre-feasibility study on this before, but we'll be updating that with the latest data, and then we'll move into a DFS for Phase 2 as well.
Potential for further phases to add more capacity from our license area after that. Next slide, please. Again, please. Just a note on the lithium market and the lithium price environment. It's obviously been very fun to watch the lithium price go vertical in the last few months. We're not getting carried away by this. This is the spot market. It, you know, represents a bit of a sort of a short-term supply-demand imbalance. We're focused on the longer term, and really we're focused on 2025 onwards in terms of where the pricing is gonna be. Luckily, though, that seems to be very, very robust. I think, most forecasters, with perhaps the exception of Goldman Sachs, see a very tight supply-demand dynamic in the years to come.
I look at this and most of the forecasters are assuming that all of the lithium projects currently in development are gonna get up and running. I just don't see that happening for geopolitical reasons, for technical reasons, you know, sometimes, frankly, for incompetence reasons. There's going to be some of those projects which get delayed and fail. Even in the best-case scenario, assuming they all ramp up on time, on budget, there's still a supply, demand deficit. I think the lithium outlook for the next 10 years at least is very, very robust indeed. Frankly, I think it's more of a risk to the electric vehicle transition. I just don't see the transition happening as quickly as we think, as quickly as we would like.
The reason for that is these projects are very large and very complex to build and take a lot of time and capital to do so, and not enough are being built at the moment. Not enough capital is going into this. Medium-term, long-term, we do see a very robust market and supply-demand dynamic for lithium. We will use long-term price assumptions in our DFS. That will be in the 20s, I would say, looking at sort of consensus analyst forecasts, in terms of thousands of dollars per ton lithium hydroxide. In 2021, we had $14,900 as an assumption in our study. We're ticking it up a little bit. Obviously nowhere near the current spot price of around about $70,000 US a ton. Next slide, please.
We do still expect to be a very low operating cost business because we are fully integrated, because we're leveraging off that freely available heat within the brine and therefore have a very low reagents cost because heat drives adsorption, and adsorption drives the lithium extraction, produces a very pure lithium chloride product, which enables us to use the lithium hydroxide. We produce a lot of the energy that we need internally, so we're not exposed so much to the energy shocks in Europe. We do expect to still retain that relative position in the market. Obviously, these figures will change in the DFS, but we do expect to still be relatively a very low, certainly lowest cost quartile operating cost project. We will have a high CapEx.
That is beyond doubt because we're building up all of these different parts of the project. It is capital-intensive. Geothermal is capital-intensive. Geothermal drilling is capital-intensive. We're building up multiple plants. It was the same in the PFS. Once again, we were highest quartile CapEx, lowest quartile OpEx. We expect to see the same dynamic in the DFS. CapEx will go up relative to PFS because it's a bigger project and we've seen significant cost inflation since then. That's all we can say at the moment. Obviously the DFS hopefully will be coming out in Q1, we'll be able to give you more detail on those numbers then. Next slide, please. These are the PFS numbers. Obviously, that will be updated in the DFS.
We're working with BNP Paribas now and really starting to ramp up our efforts towards financing. After the DFS comes out, we're going to launch into debt and equity financing. Slightly unconventionally, we'll probably do something on the equity side first. That's really to maintain that momentum in terms of ordering long-lead items. We don't want to wait for the whole debt process to play out. We need to move fast. On the equity side, we are assessing our options. What we'd like to do is we'd like to bring in a strategic partner at the asset level. We are looking at the possibilities for doing that after the DFS is completed.
This could be something like an energy company, like an oil and gas company that has similar skill sets to what we're doing on the geothermal side. Assessing our options there. We recognize that this is a very large project, so perhaps bringing in more partners at the asset level, preserves value for shareholders in the longer term, but also, brings in a strong technical partner to help us push this project forward. Next slide, please. Again, please. Our sustainability report is over there. It's a fantastic piece of work. A lot of hard work went into that from the team who are here today. I encourage you to read that.
Really we're building on our initial goal of Zero Carbon Lithium, and really integrating this into how we work as a company, and our Vulcan values of integrity, leadership, future focus and sustainability. Next slide, please. This is really where the Vulcan project stands out. These are based off our pre-feasibility study. This is our life cycle assessment. This will be updated. You can see, even with these figures from the PFS, how Vulcan is a standout project in terms of sustainability. That's enabled us to bring in these high quality people into our company. It's also enabled us to bring in high quality partners and offtakers into our company as well. This has a direct tangible effect on how we operate as a business.
It's not just a nice slide in a presentation. We also joined as a forum member of the TNFD, which is the nature task force for financial disclosures. This hasn't even been released yet. We really want to be at the forefront of best practice for sustainability reporting and the way we operate as a company sustainability-wise. It's a very core part of who we are. During the year, we also became a UN Global Compact member as well, also towards that goal of being really best practice in this space, and we are obviously certified as carbon neutral as well. Next slide, please. A big part of what we do, a big focus of the year has been community relations and government relations.
We have a great story to tell, and we see, I guess a little momentum in this space in Germany. We want to make sure that local governments, state government, federal governments in the EU are all behind us. I think for the large part they are, and I think we're really seeing momentum shift in our direction as well. Just some quotes there from some very prominent government members in Germany, really backing what we're doing, the geothermal developments, the lithium developments in the Upper Rhine Valley. Some really good progress from Horst and the team there in Germany. Next slide, please. None of this happens without community, really very local community on the ground. We are building multiple projects across the Upper Rhine Valley.
It is critical that we do this together with local communities, with local municipalities, local mayors and local people. We're a big employer already in the area. We're opening up info centers. It's quite a complex project, so really to inform people of what we're doing and how the process works. We've had multiple tours from local mayors and local politicians, local scientists. We've been sponsoring local events as well. Really in the last year, this process of community engagement has accelerated a lot, and Horst and the team are really busy towards this end. We've got 12 people in the company just focused on this particular part. It's a big focus for us. Next slide, please. Next slide, please. We've also been busy hiring as well.
If you know anybody looking for a job, we are hiring a lot of people. We've got 180 full-time employees in the company at the moment. We are recruiting scientists, engineers, chemists, chemical engineers, reservoir engineers, a whole host of people that are needed. I think we'll effectively be doubling in size over the next 12 months. It's a big recruitment drive going on. As I said, one of the main drivers for that recruitment is the message that we have. We can't pay as much as a big German chemicals company or an oil and gas company, but we can motivate people with our core mission of Zero Carbon Lithium, and that is a very, very powerful recruitment tool.
We've had people directly telling us that they're coming to us because of that goal. It helps to have motivated employees, and these are the guys who make things happen. Next slide, please. The boards you've already met today, very important part of making this project work is having those skill sets on the board to govern what we do. I think we've got a really good breadth of skills and experience now across the different industries we cover in terms of raw materials, in terms of chemicals, in terms of the battery industry, EV industry, the mining industry, and ESG as well. Really very good skill set there. Next slide, please. Again, please. We're moving now into the project's execution phase.
It's a very different skill set now going forwards. Really we need to set ourselves up for success. This is quite a new slide. This is quite a live situation. We are evolving as a company really into much more of that project execution mode and bringing in the DNA of actually the oil and gas industry, which has some really good systems that we need for efficient project execution for a project of this size, you know, north of certainly north of $1 billion of CapEx. Cris Moreno joined us. Cris joined us from Northvolt a few weeks ago. Northvolt is a large battery soon-to-be producer, developer who will be supplying Volkswagen.
Cris has been developing their cathode plants in Europe, has direct experience of building cathode plants, lithium plants in Europe. Cris was previously in the oil and gas industry, brings that DNA of this large project execution capability in-house, is very busy adjusting our systems and adjusting our structures, we're set up for success. I think there'll be a lot of movement in this space going forwards in Vulcan as a result of that. Next slide, please. I'll just finish up with timeline. We're working hard to complete the Phase 1 DFS. That should be completed in Q1 2023, not too long now, hopefully. As I said, next year is about starting to go into that execution phase.
There'll be a bridging phase, and we'll be looking at ordering our first long lead items for the commercial plant. Really a step change there in how we operate. Financing during the course of next year. We'll be working with BNP, we'll be liaising with export credit agencies, we'll be liaising with the European Investment Bank and many multilaterals across across Europe and globally in fact to finance this project. Also on the equity side, as I mentioned. A lot of the work that we will be doing between now and then will be towards financing this project for that, you know, large CapEx that we need. Permitting will be continuing really until we start production. We need a number of permits all the way up to when we actually turn on the plant.
That's a big focus of the team. Drilling, as I said, we should be ready to start in Q2 of next year. Then we'll start to print and repeat, hopefully after Phase 1, Phase 2, and further phases after that. Hopefully we get better and better at this project execution going forward. Still targeting that production in 2025. It is a tight timeline. There's no way around that. It is a very tight timeline for what we need to build. We continue to think it's achievable, but it is tight and we need to work very hard to achieve that. We're up against very unprecedentedly bad supply chains in terms of equipment delivery. It's a very competitive labor market, so we're not without challenges.
We can see that in Germany when projects are critical for the country's economy, they can be executed quickly. We've seen an LNG project which was executed in nine months to receive LNG into Germany. I think that would've taken. I mean, the airport in Berlin famously took over a decade to build. When something is critical for the economy, it can happen very, very quickly and you can cut through the red tape. Tesla's Gigafactory also popped up very quickly indeed. We know this can be done. It's not gonna be easy, bear with us and we'll get there. As I said, the next major milestone is the DFS.
Hopefully we'll be able to talk about that in the coming months in Q1 of next year. Next slide, please. Well, I'll leave it there. I think that was the final one. Look forward to your questions at the end of the meeting. Thanks very much.
College, a role he's held since 2010, it was part of my pleasure to invite Michael into that role all those years ago. He's a, he's a, he's been a member of the U.K. Task Force in Energy Efficiency, chaired the subgroup on industry, and advisor to the U.K. Board of Trade. He's a sought-after speaker, it's great to have him here this evening. I know that he's going to give us a response to a previous lecture, which we're looking forward to hearing. He's already told me he's going to offend me, I'm looking forward to your offense. As Michael will do it, he will do it eloquently, elegantly, and with clear evidence. I'm looking forward, Michael, to that.
It's really my pleasure and my privilege to invite Michael Liebreich to deliver the 2024 Energy Futures Lab Annual Lecture. Michael, over to you.
Thank you, Nigel. I will never offend. I was a bit worried because I may not say the nicest things about hydrogen, and you've been such a sort of powerful figure in that world. That's the only way I think I could offend potentially. The background to this is actually the Masters in Climate Finance and Management. I've also been an advisor. That's Mirabel's course. As an advisor, I was walking through the lobby and it was full of people, and everybody said, "You're here for the hydrogen talk." I said, "The what?" 'Cause I didn't know anything about it. It was the Lord Mayor, Professor Michael Mainelli, was talking about hydrogen for the eighteenth Lord Ezra Memorial Lecture.
Lord Ezra, of course, was the chair of the Coal Board. I thought that was interesting. We have the, you know, the Lord Ezra Memorial Lecture, which is about hydrogen. I spotted this. Well, that's interesting as well. It was actually sponsored by one of the panelists we'll be hearing from is Kate Grannell, who knows all about Cadent and probably has some thoughts on that as well. Where's Leon DeMarco? Leon DeMarco was in that audience, and he went to the organizer and said, "You need If you're gonna have a lecture on hydrogen, you need to get Michael Liebreich to do some kind of a response." That's the background here. You'll see that what I'm gonna do is I'm gonna talk about hydrogen.
I'm gonna structure it as a response to the remarks of the Lord Mayor back in March, and take, as you're gonna see, probably a slightly different view. Hydrogen has mesmerized a lot of people for a long time. This is Jules Verne, in a novel called The Mysterious Island, 1874 he wrote it, 1875 it was published. He said, "Water will one day be employed as fuel." Of course, I have a thermo background, not from such an eminent university as here, but only from Cambridge, sliding down the rankings. Nevertheless.
Obviously is a slightly strange phrase. Water is gonna be a fuel. Hydrogen. Obviously something has to happen in between to get the fuel out of the water. That's Jules Verne, 1874, 1875. This chap is John O'Mara Bockris, and he coined the phrase hydrogen economy. He was an electrochemist, and he spoke at GM, General Motors, and he said, "You know, one day your cars are gonna run on hydrogen." He didn't call it water, he said hydrogen. He called it the hydrogen economy. Some of us might remember this. There's a book by Jeremy Rifkin, The Hydrogen Economy, 2003, just when I was deeply unemployed as a result of the dotcom boom bust, which left me high and dry and unemployable.
This book summarized a lot of excitement about hydrogen around that time, and companies like Ballard fuel cells, share price, it was worth umpty billions. It was all terribly exciting, especially for an unemployed dotcom washout like me. It had this very interesting thing. Look how mesmerizing this whole thing is. Of course, I checked out at this point, it sounds because I'm not really interested in redistributing power on Earth. The lure of hydrogen is incredibly powerful. It even lured a young doctor, a young chap called Michael Mainelli, in the year 2004, who said, "Without moving almost wholly to renewable hydrogen power, significant climate change is unavoidable." You could argue that significant climate change is unavoidable, but it won't be because we didn't move to renewable hydrogen power.
Of course, Michael Mainelli is now the Lord Mayor of London and the person who delivered that 18th Lord Ezra Cadent sponsored speech. How's it going? Well, that's 150 years into the hydrogen economy. Electrolysis is churning out 0.1% of the hydrogen that's used around the world. There's some nice key figures, some heuristics that maybe will stick in your mind. 100 million tons. It's 100 million tons of hydrogen, and since it costs about $1.50 on average to make, it's a $150 billion industry. That's not nothing. You know, it's sort of 3 x the size of the U.S. food supplement business. You know, hydrogen is significant and 0.1%. By the way, if it's 0.1% electrolysis, that's not green hydrogen, that's just electrolysis hydrogen.
Nevertheless, the state of hydrogen, sort of to the extent to which people have been mesmerized, there are now 56 countries with hydrogen strategies. Every self-respecting country has a hydrogen strategy. You have, for instance, in Japan, actually the first country to have a hydrogen strategy and the first country after the oil shock to go all in on hydrogen, and you have the prime minister there shifting to and developing a hydrogen society. Hydrogen economy, hydrogen society, it's kind of the same thing, at least in my mind. It's critical for achieving decarbonization. There's Ursula von der Leyen, the EU.
Hydrogen is the natural starting point." One of the things that's kind of fun is I have a podcast called Cleaning Up, and I've had 160 guests or so, and the tagline is Leadership in the Age of Climate Change, and I've had all sorts of really extraordinary people come on. I've had everybody from the woman who glued herself to the Shell headquarters to the person who developed the Shell scenarios. I've had Tony Blair. I've had Tony Abbott. I try to get everybody in. It's, you know, if you haven't listened, please do, 'cause I have a lot of fun, and my co-host, Bryony Worthington, who's now over on the West Coast, we try and get the best guests, and we try to challenge them.
A couple of the guests are in that picture. In the gray suit, that's Giorgos Tsiamis, Head of Hydrogen Europe. Fantastic episode. I strongly recommend you listen to it, or you can watch on YouTube. Just to the right, Marco Alverà, who's gonna make a short cameo a bit later in this presentation. Germany, hydrogen, the gas of the future. Now we're starting to see what does hydrogen economy mean? You see there you've got industry, heating, and fuels. Hydrogen society, hydrogen economy doesn't mean we'll just do a bit more hydrogen, this kind of industrial gas. We'll grow a bit. We'll use it for a few things. It means we're gonna use it. It's gonna be pervasive through the economy, right? Industry, heating, and fuels.
There's part of the thinking which is because we'll use hydrogen for a few things, there's all this synergy, and it'll sort of take off like digitization or electricity. Unpredictably, it's gonna feed on itself, and we're all gonna go hydrogen. It's gonna be great. Scholz also said, "We'll create a huge boom." I normally don't show this 'cause it's sort of almost irrelevant for what we're talking about, except that the Lord Mayor did show this photograph and said, "Well, only 36 people got killed. It could have killed 96, but it only killed 30." I'm sort of obsessive about safety. You'll find that out as well, and I think Kate, whom I've worked with on a few safety issues, will know that.
You know, every self-respecting politician seems to have been mesmerized by this whole hydrogen thing. This one's interesting. This is Jennifer Granholm, Secretary of Energy in the U.S. She says it's the Swiss Army knife, right? Hydrogen economy, hydrogen society, and now we get the Swiss Army knife of zero carbon technologies. Bill Gates says some people refer to it as a Swiss Army knife, and I'm quite proud of this because I think he's talking about me, because I've been using this. I actually stole this meme from a guy called Paul Martin, who does astonishingly good work. Paul, if you're watching this, thank you, at least for the meme, but also for your work. The Swiss Army knife is fabulous. It's a great analogy because you can indeed do all sorts of things with clean hydrogen.
Transport, heating, chemical feedstock, it's a building block for chemicals, all sorts of things. Land transport, air transport, everything. The good news is the analogy is perfect. It's perfect because we've all got Swiss Army knives, right? We don't do with them everything we could. We don't cut our hair with them. We don't prune trees with them. I went to Japan, I said, "You don't prune your bonsai trees with them. You don't butter your sandwiches with the little knife." Why? The reason is there's almost always something cheaper, safer, and more convenient. Remember those three words, cheaper, safer, more convenient. The only time we really use a Swiss Army knife, either if it's cheaper, safer, more convenient, or no alternative at all.
Hydrogen will play its role in the economy will be the same. It will only be used where it's cheaper, safer, more convenient, which it never is, or where there's no alternative. Let's start with cars, because that's the one that has mesmerized more people for longer than anything else. Those are battery electric vehicles. You can see there the scale, four million per quarter, and drawn to scale, hydrogen fuel cell vehicles. If you're saying there's something wrong with the presentation, and I can't see it, no. Even in the front row, there are zero pixels. That's how successful they are. I drew this first in, I think, 2017, and the, you know, the blue chart, the scale was different. It looked the same. I said, "I will draw this. I'll keep it up to date.
I'll do this for 10 years as long as you want, and it will always look the same." Because the scale will keep going up, whatever fuel cell vehicles achieve, you still won't be able to see them. I was asked, "Why do you hate hydrogen?" I don't hate hydrogen. I don't have emotions towards elements on the periodic table, you know? I, you know, I've been right on that one. This is actually, if you expand the no pixels visible, what you actually find is that hydrogen fuel cell vehicles, sales are actually declining. How do you do that if you're a solution to climate change and the most promising technology, as we've heard? One of the things that's very interesting, can you see there South Korea, U.S., Japan, Germany, and other. Where's China?
The Lord Mayor says, "Today, China has the highest number of hydrogen fueling stations for road vehicles worldwide. You can fill up almost as you would with petrol or diesel." That's what he said. There is a Chinese fuel cell car. It's called the Zhejiang Long something, lots of letters, HS something else. Not a single one was sold for the first six months in May 2023. It was launched in 2022. There are some fuel cell trucks in China, I think about 6,000. You can restate that chart, but it's in those. It's in the pixels that you can't see. All right? It's noise. Fuel cell hydrogen fueling stations are being dismantled. All the Shell hydrogen stations in the U.K. were shut. You've got these ones, which are California stations, shut. Denmark, the stations were shut.
Toyota is giving 500 fuel cell Toyota Mirais to the Paris Olympics to drive the athletes around. Probably they're organizing fueling through Air Liquide completely separately, but right now there are nine fueling stations in Paris, of which two are actually working. Buses. Here you've got the very high-profile launch of hydrogen buses, 2019, the French city that pioneered it will in future be using EVs. I was on the board of Transport for London. We had some fuel cell buses because at that time, we were still in the EU, they gave them to us, management used them as an excuse not to dive into electric buses. It was predatory delay. You had some hydrogen buses, you could sort of say, "Well, we need to study them.
We can't make decisions," which is why London today only has about 1,000 electric buses out of a fleet of about 8,500. We are way behind the curve. Why? Part of the reason was the delay caused by the hydrogen buses. Trains. Very, very promising hydrogen trains, again, the launch of trains. This is a pattern that you'll see going across the world. You'll see some mayor, some council gets excited, finds a pot of money, assembles some funding, goes for some trains, goes for some buses, and a few years later, they disappear, which is why Ballard, which has been around for 44 years, has done nothing but burn through capital. By the way, Plug Power, ITM, all of the other ones as well. Hydrogen production, despite being awarded millions in state funding, once pioneering green hydrogen project has been scrapped.
Green ammonia, vast green ammonia plant in Geismar, Louisiana, scrapped. Hydrogen imports via liquid hydrogen, scrapped. There is a spot of light, though. There is one sector where fuel cells rock, and it is forklift trucks. There's 25,000 forklift trucks powered by hydrogen fuel cells. It's the future. The good news is you can see the pixels, right? You can actually see, at least if you're in the front. The point being that 25,000 forklift trucks is nothing. We have to be serious here. What you've actually got is two million electric forklift trucks sold, and I think, by the way, the 25,000 is cumulative. Matt, where's Matt? Matt, we need to work on this 'cause I think the 25,000 that the mayor is talking about is cumulative, right?
These are actual sales, so they are No, they are invisible largely, right? That's the best sector that you can come up with. Despite all of this, because of all the excitement and attention and 56 hydrogen strategies around the world, there are lots and lots of projects all looking for this, the mountain of carrots. It's not a hydrogen economy, it's a hydrogen carrot-