Regulatory News:
Arverne Group (FR001400JWR8 - ARVEN), a French industrial company specialized in the production of renewable underground resources to support the energy transition, announces its financial results for the first half of 2024:
- consolidated revenues of EUR4.5 million in line with the forecast;
- gross business volume of EUR6.0 million in line with the forecast, including 50% of the shallow drilling revenues of DrillHeat(1) ;
- a strong financial position with net cash amounting to EUR118.2 million;
- major technical advances achieved in the first half of the year:
-- Completion of the pre-feasibility study $(PFS)$ on the lithium process, marking a key step towards the launch of the industrial phase of geothermal lithium production, -- execution of two new 3D exploration campaigns in Alsace during summer 2024, positioning the Group as one of the most active players in geophysical data acquisitions in Europe over the past three years; -- Ramp-up of the industrial tool capacity with equipment orders and preparation of the first drilling operations, increase of the drilling rig fleet,
- ongoing Group structuring and strengthening of the teams reaching 167 employees by the end of the period (187 including the 20 DrillHeat employees), representing an increase of 61%.
"The first half of the year saw further major advances for Arverne Group driven by the dedication of all our teams, partners and shareholders, to whom I extend my warmest thanks. Our 3D exploration campaigns have reached an unprecedented scale in our industry. The acquisition of new permits has broadened our scope of action and growth potential. In parallel, we have strengthened and optimized our organizational structure, building up qualified teams. Lithium de France successfully completed its pre-feasibility study (PFS), marking a major step towards the launch of the industrial phase of lithium production with improved visibility. These achievements are not just isolated successes, but solid pillars on which we are building Arverne Group's future. They provide us with the resources and skills necessary to achieve our ambitions. We are builders, visionaries who are shaping the future of energy." says Pierre Brossollet, Founder, Chairman and CEO of Arverne Group.
H1 2024 highlights
2gré: geothermal potential confirmed
The project identification work carried out by our teams in recent months has enabled us to build up a portfolio of geothermal heat production projects with an estimated potential of over 60 power plants and 3.5 TWh of production.
Heat production
Project stage (GWh/year)
------------------------------------------------------------- ---------------
Projects nearing completion 410
------------------------------------------------------------- ---------------
Projects in development: pre-feasibility study in progress,
negotiation of contractual and commercial terms 1,340
------------------------------------------------------------- ---------------
Targeted potential projects: geothermal potential study
launched 750
------------------------------------------------------------- ---------------
Prospective projects identified: prospect expresses
geothermal needs, geothermal potential to be qualified 940
------------------------------------------------------------- ---------------
Against a backdrop of rapid market changes and in order to meet customer needs, 2gré's project development strategy has been refined:
- Acceleration, particularly in the Ile-de-France region, a historical development zone for deep geothermal energy, with the Dogger reservoir (1,500 meters deep, 60-80 degrees)
- Increase in production capacity of standard geothermal power plants: the possible addition of a heat pump to boost annual production potential (from 35 GWh to more than 60 GWh), adapt the output temperature to the needs of heating systems and industrial customers, while also meet increased operating hours mandates by the public authorities
- Preparation of the first 3D sub-surface data acquisition in the Auvergne-Rhône-Alpes region for a new geothermal project on the Riom Clermont Ferrand Exclusive Exploration Permit $(PER)$
Taking these factors into account, along with the significant project portfolio, the first geothermal heat production of is now scheduled for 2026.
To achieve these advances, the teams have been strengthened with the addition of technical experts, geologists, drilling managers and salespeople. As of June 30, 2024, the number of employees has risen to 15.
Serge Guibert, Chief Financial Officer, also joined the Group on July 1, 2024.
Lithium de France: completion the pre-feasibility study that confirms competitive production costs, and positioning the project in the first quartile worldwide
Lithium de France successfully completed its pre-feasibility study (PFS), marking a major step towards the launch of the industrial phase of lithium production.
The results obtained strengthen the group's assumptions, and confirm a new level of due diligence that clarify the feasibility of the project. The costs identified position the project in the first quartile of lithium projects worldwide.
Lithium de France is therefore able to announce strategic technical decisions and update key financial assumptions:
- choice of product: decision to produce lithium carbonate $(LC)$, a product better suited to the electric vehicle industry's energy transition goals;
- choice of extraction technology: extraction technology (DLE) will be based on "adsorption", with the aim of confirming its performance in 2025 using a pilot plant;
- lithium production cost: estimated below EUR4,500/t of lithium LC and placing the project in the first quartile of the cost curve in terms of cash cost;
- process efficiency: 91% of recovery rate;
- investment and production: total gross CapEx (excluding subsidy) adjusted to EUR1,800 million - EUR1,900 million (including 15% contingency) for the production of 27,000 t/year of lithium (LC) to be reached in 2031;
The company also announces:
- the grant of a new lithium license in Alsace (Les Poteries Minérales) and the submission of two new Exclusive Exploration Permit $(PER.AU)$ applications;
- the completion in summer 2024 of two 3D exploration campaigns (100 km(2) and 60 km(2)), bringing the total surface area of imaging data acquired to 310 km(2) in two years
- the ordering of Long Lead Items to prepare the drilling campaign
The successful completion of this stage enables Lithium de France and its strengthened teams (36 employees, +71% vs. H1 2023) to prepare for the launch of the definitive feasibility study $(DFS)$ at the beginning of 2025.
Scale-up of drilling companies
Arverne Drilling Services and DrillDeep(2) , deep drilling
The drilling business continued to improve its execution capacity, with three projects completed over the period. In order to secure the future operations and accelerate the integration strategy in response to growing drilling needs, a new subsidiary, DrillDeep, was created in March 2024 with the leading German manufacturer Herrenknecht.
The construction of a new state-of-the-art drilling rig is in its final stage, with delivery scheduled for the end of 2024.
As in the other Group divisions, teams have been strengthened, with staff numbers rising from 71 (June 30, 2023) to 98 as of June 30, 2024, particularly to prepare for the drilling campaigns of Lithium de France and 2gré.
DrillHeat(3) , shallow drilling
The company acquired three new drilling machines in the first half of the year, bringing the total to six. DrillHeat completed 16 projects, drilled more than 26,000 meters and installed 160 geothermal probes for public authorities and commercial buildings.
To keep pace with the ramp-up of operations, the workforce has been increased from 11 (June 30, 2023) to 20 as of June 30, 2024.
Expanded governance: structuring appointments
The Group announces new appointments and forthcoming developments to strengthen its governance:
- Guillaume Saincaize joined Arverne Group as Human Resources Director in April 2024.
- Laurence Guillemot joined Arverne Group in June 2024 as Head of development of shallow geothermal energy.
- Frédéric Houssay, previously a Group Director, has taken on operational duties and was appointed Director of New Business for the Grand Est Region on September 1, 2024.
- Damien Bevillon, currently Managing Director of 2gré, will become Exploration and Production Director of Arverne Group on October 1, 2024;
- Martin Jahan de Lestang joins the Group on October 1, 2024 as Managing Director of 2gré.
Gross business volume driven by drilling activities
(MORE TO FOLLOW) Dow Jones Newswires
September 25, 2024 12:00 ET (16:00 GMT)