Crowded EV Market Keeps Lithium Flying High
LOS ANGELES, October 27, 2017 /PRNewswire/ --
Spurred on by the success of automakers like Tesla, Inc. the Electric Vehicle companies continue to fuel the red hot market for lithium. The idea is so popular that inventor Sir Dyson is jumping in with a new lithium-powered vehicle expected by 2020.
Lithium mining and production companies have been first to see benefits from the increased demand including Sociedad Quimica y Minera de Chile (NYSE: SQM), Nemaska Lithium Inc. (TSX: NMX) (OTC: NMKEF), Lithium X Energy Corp. (TSX-V: LIX) (OTC: LIXXF), and NRG Metals Inc. (TSX: NGZ) (OTC: NRGMF).
Lithium is the world's softest metal now being heralded as the "new gasoline" that will be needed to power the influx of new electric vehicles.
Electric Vehicles depend on lithium-ion batteries for efficient storage and operation. The massive increase in demand brought on by new and existing automakers is creating the potential for a considerable shortfall on the horizon. Few expected that demand would be this large this fast.
All this accelerated production has lithium companies moving at an equally rapid pace to answer the demand by generating more high quality lithium, including new Lithium reserves.
An early entrant zeroing in on the most prolific source for lithium is NRG Metals Inc. (TSX: NGZ.TO [https://finance.yahoo.com/quote/NGZ.V?p=NGZ.V ]) (OTCQB: NRGMF [https://finance.yahoo.com/quote/NRGMF?p=NRGMF ]). This relative newcomer is aggressively developing a potentially huge lithium brine project in South America's well known "lithium triangle".
Other lithium companies that have seen their share prices rising alongside the new wave of demand include Sociedad Quimica y Minera de Chile (NYSE: SQM), the big producer of lithium in South America's hot spots, Nemaska Lithium Inc. (TSX: NMX.TO) (OTCQX: NMKEF), a Canadian company focused on a new lithium project and establishing refining operations in Quebec, as well as, Lithium X Energy Corp. (TSX-V: LIX.V) (OTCQX: LIXXF), a smaller company, but well respected for its significant lithium interests in Argentina and Nevada, USA.
YOU KNOW ITS BIG WHEN DYSON JUMPS IN
Dyson, the engineering company that is best known for its radical innovations in vacuum cleaners and fans, recently announced plans to spend 2 billion pounds developing a "radical" electric car.
According to Dyson's timetable, the battery-powered vehicle is due to be launched in 2020.
Dyson says that a staff of 400 people have been working on the secret project for over two years now at the Company's headquarters in Malmesbury, England.
At present Dyson says that the car does not yet exist, and no prototype has been built. They say that a factory site is yet to be chosen, but it's likely that Dyson has some designs on that as well.
Sir James declined to give further details of the project. "Competition for new technology in the automotive industry is fierce and we must do everything we can to keep the specifics of our vehicle confidential," he told staff in an email.
AUTOMAKERS PILE IT ON
China's new automotive mandate to ban gas and diesel powered cars, coupled with existing plans by Tesla, Volvo and just confirmed by German automakers BMW, Mercedes and Volkswagen, have sent the expected demand for lithium soaring.
Industry consultants Roskill estimate 785,000 tonnes of lithium carbonate equivalent a year will be needed by 2025. That amounts to a 26,000-tonne shortfall from anticipated supply, compared to 217,000 tonnes of demand versus 227,000 tonnes of supply this year.
Major producers of lithium are working furiously to increase their production and refining capabilities, but even they will not be able keep pace with new lithium needed to fill the gap.
MORE, MORE AND MORE STILL
The increased demand for lithium is unlike anything predicted. Then again, so is the participation by the major automakers and new companies like Dyson.
Analysts suggest that in order to meet the requirements for lithium, one new lithium mine needs to be brought on line each year through 2025. That accounts for existing demand only.
About two-thirds of proven reserves of lithium are concentrated in a small, high-elevation area of South America in what's known famously as the "Lithium Triangle". This hotspot for the new gasoline is geographically at the intersection of Argentina, Bolivia, Chile.
This is the area where NRG Metals is focused on producing in the Puna Region. It's an area widely considered one of the most productive areas in a country that produces about 50% of the world's lithium.
In reality, just four companies account for 86% of global lithium production. Geographically speaking, about 70% of lithium production is based South America, focused mostly on the Lithium Triangle.
Clearly South America's Lithium Triangle is the place for an up and coming lithium company to place its bets.
NRG METAL'S RIGHT PLACE, RIGHT TIME SCENARIO
NRG is a Canadian mining company that has located its lithium interests located in Argentina. The company is comprised of Canadian mining know how combined with experienced in-country management that originates in Argentina.
This relatively young company has positioned itself right at the perfect spot for lithium.
It has two core projects: The Salar Escondido lithium project, a well-developed project heading into drilling, and the Hombre Muerto North lithium project in the province of Salta, now under exploration.
The region is also host to the Hombre Muerto Salar. That's where giant FMC is producing approximately 20,000 tonnes of lithium carbonate equivalent per year. It is also home to Galaxy Resources' large development stage Sal de Vida project.
NRG Metals recently released news of its "Vertical Electrical Sounding (VES) geophysical survey that has identified a highly conductive horizon that is interpreted to represent a brine target with potential to host lithium."
In a nutshell, the survey outlined a kind of salt lake roughly 4 kilometers by 6 kilometers in size located at depths from 70 to 300 meters below the surface. This is what could be interpreted as a major brine deposit.
NRG Metals is approved to drill the property and proceeding to further detail the potential lithium resources with the expectation of moving to production.
At this point, the opportunities for lithium are being blown wide open.
With relatively even unknown innovators, such as Sir Dyson jumping in the electric vehicle ring, the demands are getting heady. Add to those the already hungry markets such as smartphones and energy storage, and you have a potential for soaring lithium prices that drive growth.
The producers and near-term producers of lithium are getting a lot of attention right now, and with good reason.
Among the big players in lithium, a few new entries to South American lithium development, are standouts. NRG Metals is one to follow with its rapidly advancing lithium projects. NRG is focused on significant resources in the world's richest lithium region and poised to reach the production stage with its peer lithium producers there.
POTENTIAL COMPARABLES
Sociedad Quimica y Minera de Chile (NYSE: SQM)
Sociedad Quimica y Minera de Chile S.A., is a producer of potassium nitrate and iodine. The Company produces specialty plant nutrients, iodine derivatives, lithium and its derivatives, potassium chloride, potassium sulfate and certain industrial chemicals. Its segments include specialty plant nutrients, industrial chemicals, iodine and derivatives, lithium and derivatives, potassium, and other products and services Lithium and its derivatives are used in batteries, greases and frits for production of ceramics. Potassium chloride is a commodity fertilizer that is produced and sold by the Company across the world.
Nemaska Lithium Inc. (TSX: NMX.TO) (OTCQX: NMKEF)
Nemaska Lithium Inc. intends to become a lithium hydroxide supplier and lithium carbonate supplier to the emerging lithium battery market that is largely driven by electric vehicles. On August 01st, the company released diamond drilling results from the 2017 drill program at its 100-per-cent-owned Whabouchi lithium mine project. The 4,361-metre drill program combines definition drilling to a depth of 50 metres in the five-year starter pit between sections 200E and 700E as well as expansion drilling in the Doris zone located immediately to the southwest of the main Whabouchi deposit.
Lithium X Energy Corp. (TSX-V: LIX.V) (OTCQX: LIXXF)
Lithium X Energy Corp. is a lithium exploration and development company with a goal of becoming a low-cost supplier for the burgeoning lithium battery industry. On July 11th, the company announced that further to its news release of June 29th, 2017, the Company has closed the definitive agreement with Aberdeen International Inc. for the purchase of Aberdeen's remaining 50% interest in Potasio y Litio de Argentina S.A., which controls 100% of the Sal de los Angeles Project. The project consists of 8,154 hectares covering 95% of Salar de Diablillos, and has an NI 43-101 mineral resource estimate of 1.037 million tonnes of lithium carbonate equivalent in the indicated category and 1.007 million tonnes of lithium carbonate equivalent in the inferred category.
For a more in-depth look into NGZ you can view the in-depth report at American News Group: http://usanewsgroup.com/2017/10/23/how-south-americas-lithium-triangle-is-gearing-up-to-feed-our-battery-addiction-3-2
Article Source: USA News Group http://usanewsgroup.com info@usanewsgroup.com
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