BASF and Vulcan Join Forces to Explore Geothermal Energy for Sustainable Manufacturing
BASF SE (BASFY) and Vulcan have signed a memorandum of understanding to investigate geothermal energy applications at BASF’s facility in Ludwigshafen, Germany. The objective is to utilize natural heat from deep geothermal sources to fulfill the site’s future base load energy needs. The nearby cities of Frankenthal and Ludwigshafen are already undertaking seismic studies to assess the viability of this sustainable heat source.
Sustainable Lithium Production for the Future
In tandem with providing renewable heat, Vulcan aims to produce sustainable lithium for the European battery and automotive sectors. The Upper Rhine Graben contains geothermally heated water rich in lithium, which is essential for manufacturing lithium-ion batteries used in devices such as smartphones and electric vehicles. BASF plans to generate steam from hot thermal water, while Vulcan will use an efficient technique known as adsorption-type direct lithium extraction to recover the lithium.
Potential Benefits for Local Communities
Utilizing deep geothermal energy offers potential applications for both industrial and residential heating. This could play a significant role in the local transition to low-emission heating. Vulcan and BASF are collaborating with local energy companies, Technische Werke Ludwigshafen and Stadtwerke Frankenthal, to investigate whether the geothermal energy from the project can help provide low-emission heating solutions for homes in these areas.
Next Steps in Geothermal Exploration
The next phase involves conducting a seismic survey to evaluate geothermal conditions in a specific area of the Upper Rhine Graben. Vulcan will take the lead in project development and technical operations, with preliminary exploratory work expected to commence in early 2025.
BASF’s Current Market Performance
BASF’s stock (BASFY) has declined by 4.6% over the past year, contrasting with a 6.2% increase in its industry.
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BASFY’s Rank & Key Picks
Currently, BASFY is rated as a Zacks Rank #5 (Strong Sell). In contrast, more favorably ranked stocks in the basic materials sector include Carpenter Technology Corporation (CRS), DuPont de Nemours, Inc. (DD), and CF Industries Inc. (CF).
Carpenter Technology has a Zacks Rank #1 (Strong Buy) and has consistently surpassed earnings estimates, recording an average surprise of 14.1%. Its shares have surged 160% in the last year.
DuPont, rated Zacks Rank #2 (Buy), has an estimated current-year earnings of $3.88 per share, reflecting an 11.5% year-over-year increase. Its shares have risen by approximately 16.9% over the same period.
CF Industries, with a Zacks Rank #1, has a current-year earnings estimate of $6.32 per share. The company has met or exceeded earnings expectations in two of the last four quarters, enjoying about an 18.3% increase in stock value over the past year.
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DuPont de Nemours, Inc. (DD) : Free Stock Analysis Report
CF Industries Holdings, Inc. (CF) : Free Stock Analysis Report
BASF SE (BASFY) : Free Stock Analysis Report
Carpenter Technology Corporation (CRS) : Free Stock Analysis Report
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