.....it would be a bombshell if true. But JCapital is notorious to be an activist short seller. Ironically, if VUL had not issued a statement, fewer would have known about it.
J Capital is short Vulcan Energy Resources Limited (VUL.AX)
Vulcan: The God of Empty Promises
Vulcan Resources (VUL ASX) is a wannabe lithium miner that reversed into an Australian penny-stock copper miner. By promoting the company's future project, in Germany, as “zero-carbon,” Vulcan management has driven up the share price by 80x and clearly hopes to strike it big after years of failure in this arena. We think they have acted deceptively. They have based highly optimistic assumptions for the project on work done by small consultancies that were owned by management and acquired by Vulcan.
Vulcan is a combined geothermal-power and lithium project. Geothermal wells are to serve a dual purpose: deliver brine to operate a geothermal-electricity plant and carry lithium, to be extracted from brine that is then reinjected into the reservoir. Vulcan says geothermal electricity will be used for the extraction, and the excess power will be sold at a profit. They claim the project is a twofer: profitable geothermal power and “green” lithium.
Neither assertion is likely to be true. Our research shows that the project may never actually get under way: the costs are higher than the company claims, output will be lower, the environmental impact is brutal enough that public outcry will block permits, as has happened before in the area, and the quality of the lithium resource is low. Many experts agree with us that this project is a non-starter.
BUT
Vulcan says short seller made inaccurate statements
Tom Richardson
Vulcan Energy Resources has dismissed a short seller report authored by J Capital Resources as containing a large number of inaccurate statements and assertions.
The $1.86 billion lithium market darling didn’t specify what statements or assertions in the 24-page short report it considers inaccurate.
It also said J Capital is biased and seeks to profit from declining stock prices, while not holding an AFSL. It said the report’s author Tim Murray has no technical qualifications in geothermal energy or lithium extraction.
Vulcan said its team of around 80 staff will remain focused on developing its geothermal lithium project.
Vulcan shares are up 6700 per cent since June 2018 as it says it can develop a zero-carbon lithium project in Germany using new lithium extraction technologies.
