Consumer Electronic Devices Fueling Steady Demand for Lithium and Cobalt
Palm Beach, FL – August 19, 2020 – The global lithium-ion battery market size has been growing over the last few years and is expected to continue for several years in the future. Lithium-Ion, or Li-Ion batteries are a type of rechargeable battery that’s used in many applications, but most commonly in the electronics industry. Li-Ion batteries provide portable electricity, powering electronic gadgets such as mobile phones, laptops and tablets. A recent report from Grand View Research said that the global lithium-ion battery market size was valued at USD $32.9 billion in 2019 and is expected to grow at a compound annual growth rate (CAGR) of 13.0% from 2020 to 2027. The report said: “The growth of the market is attributed to the growing demand for the lithium-ion battery in Electric Vehicles (EVs) and grid storage as it offers high-energy density solutions and lightweight. The subsequent increase in the registration of EVs and a decrease in the price of the lithium-ion battery is estimated to expand market size over the forecast period. Also, a surge in sales of EVs and change in user preferences is likely to drive the market. The mounting number of photovoltaic installations and nuclear power plants, along with the beginning of the wind energy projects, is projected to propel market growth over the estimated period. Expanding off-grid installations in the U.S., India, China, and Germany, along with the growing acceptance of Li-ion batteries in equipment used in the medical sector, is expected to encourage the market for lithium-ion battery over the forecast period.” Active stocks mentioned in today’s commentary include: Fuse Cobalt Inc. (OTCQB: FUSEF) (TSX-V: FUSE), American Lithium Corp. (TSXV: LI) (OTCQB: LIACF), Albemarle Corporation (NYSE: ALB), Ivanhoe Mines (TSX: IVN) (OTCQX: IVPAF), Sherritt International Corporation (TSX: S) (OTCPK: SHERF).
The report added: “The lithium-ion battery is used in electronic devices such as smartphones, power tools, and digital cameras. Hence, the demand for the battery in the railway industries, manufacturing sectors, and solar power is likely to surge with the rising need for storage and power backup. Long life span, reduction in battery prices, and high density will drive the market for lithium-ion batteries over the forecast period. Growing demand for other kinds of batteries such as lithium-air, flow battery, sodium nickel chloride, and lead-acid batteries in energy storage, consumer electronics, and electric vehicles is projected to restrain the market over the estimated period. Also, inclination towards renewable energy for generating power was driven by growing apprehensions related to favorable government incentives, climate change, decreasing batteries cost, and the falling price of solar photovoltaic cells.”
Fuse Cobalt Inc. (TSXV: FUSE) (OTCQB: FUSEF) BREAKING NEWS – Fuse Cobalt Update – Ontario Cobalt Properties and Nevada Lithium Project – Fuse Cobalt (“the Company“ or “Fuse”) is pleased to provide an update on the Company properties located in Cobalt Ontario, Canada and in Mineral County Nevada, USA. There are two reports expected soon on the Teledyne and Glencore Bucke cobalt properties located in Ontario Canada which include an updated NI 43-101 Technical Report (including some previously unreleased drill results) and a Scope of Work Study for the de-watering and reclamation of the important Teledyne ramp.
Robert Setter, President and CEO commented that “The entire team at Fuse is eagerly anticipating this update from our geological team because it will detail our understanding of the extent of cobalt mineralization and the logical next steps to continue to create shareholder value.” The Scope of Work Study is specific to the de-watering and reclamation of the Teledyne ramp where a high degree of cobalt mineralized material is believed to exist by our geological team and as indicated by past exploration results. Robert Setter notes, “the Teledyne ramp was built in 1980 for the purpose of accessing what was thought to be a highly mineralized ore body and we are fortunate to have found one of these key individuals that worked on that ramp in 1980 to do this Scoping of Work Study. His pre-existing knowledge of the ramp construction is proving to be beneficial in the preparation of the study and evaluation of the exploration area around the ramp. This will end up saving the Company an incredible amount of both time and money.”
As well, in late July, an initial site visit was conducted at the Teels Marsh lithium project in Nevada. Our lead geologist, Alan Morris, visited the site to verify the location of the recently staked claims, look for potential lithium rich clay deposits and inspect the gravel pads previously constructed by Dajin for use in a potential deep drilling program. Mr. Morris collected several soil samples around the claims and states “The comparison of the trace element geochemical patterns will help us identify the source of the ash beds encountered in the drilling at Teels and let us know more about how best to explore and develop this property”
Cobalt continues to be in the news as this important metal gains prominence within EV battery production. Reuters reported on August 5th that “African Supply Bottlenecks Fuel Cobalt Price Surge” due to transport delays in conjunction with COVID-19 lockdowns just as Chinese demand for cobalt hydroxide used in EV batteries is expected to increase. PRC-based cobalt refiners are now increasing their cobalt hydroxide feedstock in preparation for a rebound in demand as coronavirus lockdowns are easing in China. “This will undoubtedly lead to an increase in demand and price for the metal in the short-term, something we are seeing right now in the global commodity markets” comments Mr. Setter.
Other positive cobalt news includes the Canadian exploration activity of Kobold Metals. They have recently announced they had acquired a property in northern Quebec near Glencore’s Raglan nickel mine. Mr. Setter states “As you recall, KoBold Metals is a start up company backed by Bill Gates, Jeff Bezos and other billionaires looking to advance clean energy initiatives. The company plans to scour for cobalt in Canada using advanced mapping technology.” Mr. Setter concludes, “The need for and search for “clean” cobalt sources is no longer up for debate. Cobalt is too important for the EV battery as it enhances range and stability both of which are critical for consumers as the forecast mass global EV adoption continues to unfold.” Read this full release and more news for FUSE by visiting: https://fusecobalt.com/category/2020-news-releases/
In other market news of note:
American Lithium Corp. (TSXV: LI) (OTCQB: LIACF), a leading lithium exploration and development operator, recently announced the signing of a letter of intent to acquire a 100% interest in certain privately held lands and the accompanying 1,176 acre-feet of water rights (the “LOI”). The acquisition of the water rights will allow American Lithium to continue advancing its flagship TLC project, near Tonopah, Nevada, by guaranteeing a supply of water for any planned future development.
The water rights come from a 326-acre farm whose water rights are part of the same hydrographic basin as the TLC Project, Basin 137-a, or ‘Big Smoky Valley – Tonopah Flat’. The purchase of the farm is a critical step in securing the required makeup water for the innovative patent-pending lithium recovery process for TLC’s unique lithium bearing claystones. Work to date has identified a pit-constrained resource (at 400 ppm cut-off) of 1.107 billion tonnes measured and indicated (“M+I”) plus 362 Mt inferred containing 5.37 million tonnes lithium carbonate equivalent (“LCE”) M+I and 1.76 million tonnes LCE inferred (see American Lithium news release dated May 20, 2020).
Albemarle Corporation (NYSE: ALB) recently announced its results for the second quarter ended June 30, 2020. Second Quarter 2020 Highlights Were: Net income of $86 million , or $0.80 per diluted share; Adjusted diluted EPS of $0.86; Net sales of $764 million decreased by 14%, in-line with Q2 2020 outlook; Adjusted EBITDA of $185 million decreased by 29%, in-line with Q2 2020 outlook; Our plants continue to operate without material impact from the COVID-19 pandemic; Maintained our quarterly dividend of $0.385 per share, an increase of approximately 5% over the quarterly dividend paid in 2019; Continued actions to bolster our balance sheet and enhance financial flexibility include the previously announced covenant amendment; and Cost savings initiatives remain on track: realization of between $50 and $70 million of sustainable cost savings in 2020; implementation of short-term cash management actions to save between $25 and $40 million per quarter; and deferral of 2020 capital spending by about $150 million from plan.
“We are pleased that our net sales and adjusted EBITDA were at the upper range of our outlook this quarter. These results are due in no small part to the diligence of our global teams who continue to operate our businesses safely and efficiently,” said Albemarle CEO Kent Masters . “We remain confident that we have the right strategy in place to deliver value to our stakeholders by investing in and growing our Lithium business. While our strategy has not materially changed, the environment in which we operate has changed dramatically. Our response must be to focus on operational discipline in terms of manufacturing, business, and capital project excellence.”
Ivanhoe Mines (TSX: IVN) (OTCQX: IVPAF) recently announced that the company has entered into a strategic partnership agreement with China Nonferrous Metal Mining (Group) Co., Ltd. (CNMC), one of China’s leading mining companies, to jointly examine exploration, development and acquisition of mineral projects, as well as production, smelting and logistics opportunities, on the African continent.
CNMC, headquartered in Beijing China, is a world leader in the development of nonferrous metal projects; with exploration, construction and engineering, mining, smelting and logistical operations spanning more than 80 countries and covering more than 40 nonferrous metals, including copper, nickel, cobalt, gold, silver, tantalum, niobium, beryllium, zinc and lead.
More than 20 years ago, China Nonferrous Metal Industry’s Foreign Engineering and Construction Corp., the predecessor of CNMC, made the first international acquisition by a Chinese mining company with the purchase of the Chambishi Copper Mine in Zambia; an investment that was facilitated by Mr. Friedland. CNMC’s continued development of the project led to the commencement of operations at the Chambishi Copper Smelter in 2009. Copper production from the Chambishi South East Ore Body began in 2018.
Sherritt International Corporation (TSX: S) (OTCPK: SHERF), a world leader in the mining and hydrometallurgical refining of nickel and cobalt from lateritic ores, recently reported its financial results for the three- and six-month periods ended June 30, 2020. All amounts are in Canadian currency unless otherwise noted. “As a result of additional health and safety practices and new work processes implemented in early March, our mine operations at Moa and at our refinery in Fort Saskatchewan were largely unaffected by the spread of COVID-19 and delivered strong finished nickel and cobalt production results in Q2,” said David Pathe, President and CEO of Sherritt International. “We expect to build on this momentum through the end of the year and forecast producing between 32,000 and 33,000 tonnes of finished nickel and between 3,300 and 3,400 tonnes of finished cobalt on a 100% basis for 2020 in line with our original guidance for the year.”
Mr. Pathe added, “Also in Q2, we implemented further austerity measures designed to reduce costs, preserve liquidity and defer budgeted expenditures for 2020 in the face of uncertainty caused by the global pandemic to near-term economic and market conditions and, more particularly, on our ability to collect on overdue amounts owed to us by our Cuban energy partners.
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