BMW Walks Away From European Lithium Offtake as Koralm Mine Slips Further Behind Schedule

BMW has cancelled its lithium supply agreement for the stalled Koralm project, as European Lithium shareholders weigh an October merger vote.

European Lithium has confirmed that BMW has terminated its supply agreement for lithium from the company's long-stalled Koralm project in Carinthia, Austria — a fresh setback for a mining venture that has now been promised for more than a decade without a single tonne extracted.

The cancellation surfaced in the company's 2025/26 annual report, published Wednesday, which also disclosed that the advance payment BMW had previously made has already been returned to the German automaker.

Permits, Courts and a Two-Year Wildcard

The Austrian press agency APA notes that European Lithium first secured the rights to the Carinthian deposit back in 2011. Production was originally flagged for roughly ten years ago, yet commercial mining remains years away. Neither the operating licence nor the extraction permit has been granted.

A pending legal question is adding to the delay. Austria's Administrative Court is weighing whether the project must undergo a full environmental impact assessment. Environmental groups expect a judicial ruling no earlier than 2027 — and should the case be referred to the European Court of Justice, that step alone could stretch the timeline by roughly two more years.

A Merger Vote With a 41% Stake on the Line

The Koralm deposit sits inside Critical Metals, in which European Lithium holds a stake of about 30%. That relationship is now driving the agenda: shareholders will vote on 22 October 2026 on a merger between the two companies, with completion targeted for November 2026.

The transaction is structured as an all-share deal, and the voting documents were dispatched a little over a week ago. An independent expert who reviewed the offer labelled it "not fair, but reasonable" — an assessment that coincided with a temporary consolidation phase in the share price. Media reports put the stated total volume of the deal at $835 million. If the resolutions pass and the court approvals proceed on schedule, existing European Lithium shareholders would end up holding 41% of the combined entity.

A Billion-Dollar Accounting Gain and a A$296.3 Million War Chest

European Lithium filed its full annual report for the 2026 financial year, along with supplementary corporate governance disclosures, with the Australian Securities Exchange (ASX) at the close of the trading week. As of 30 June 2026, the company reported liquid funds of A$296.3 million.

The bottom line for the year ended 30 June 2026 was shaped overwhelmingly by a one-off accounting item: the deconsolidation of Critical Metals Corp generated a book gain of A$1.276 billion, a non-cash effect that eclipsed the operating performance of the reporting period.

Mixed Signals From the Analyst Community

Coverage of Critical Metals on the US exchanges has been far from uniform. Cantor Fitzgerald initiated its watch on 14 July with a "Speculative Buy" rating and a price target of $18.00.

Shares Up 171% Despite the Headwinds

Through all the project delays and the collapsed BMW arrangement, European Lithium's stock has held its ground. The shares closed at EUR 0.2455, leaving them 171% higher since the start of the year and about 20% below their 52-week high. Whether the ownership structure of the Koralm deposit can be reorganised as planned now rests with the shareholders' upcoming vote.