Lithium Mining Focus Moves to the United States
The majority of the world’s lithium is produced in mines located in Chile, Argentina and Australia, but almost all of the lithium mined there winds up in Asia to be used in manufacturing batteries. The United States currently has only one active lithium mine, located at Silver Peak, Nevada, about 200 miles northwest of Las Vegas, although there are exploratory companies poking around other locations (http://nnw.fm/1i1IF). Clearly there’s a real need to develop additional lithium resources and processing methods, according to Robert Mintak, the CEO and director of Standard Lithium Ltd. (TSX.V: SLL) (FRA: S5L) (OTCQX: STLHF).
As a junior mining company, Standard Lithium is building one of the largest portfolios of high quality, domestic U.S. lithium brine assets. The company just announced its entry into an option agreement with TETRA Technologies Inc. (NYSE: TTI) to acquire the rights to conduct exploration, production and lithium extraction activities on up to 33,000 acres of brine leases located in a highly productive area of Southern Arkansas’ Smackover Formation.
“In our search for opportunities of significance, this is one that could really move the needle,” Mintak said in a January 2018 news release about the agreement (http://nnw.fm/8QUsp). “We believe the Smackover may be one of the lithium industry’s most promising regions to develop, given the potential resource size and large-scale brine-handling infrastructure in the region.”
Global Lithium Demand Rise Being Fueled by Increase in Electric Vehicle Production
Zion Market Research reports the global lithium-ion battery market was valued at around $31.17 billion in 2016 and is expected to generate revenue of $67.70 billion by 2022, growing at a CAGR of slightly above 13.7 percent between 2017 and 2022 (http://nnw.fm/Xer7W). By 2040, 54 percent of new car sales and 33 percent of the global car fleet will be electric, Bloomberg New Energy Finance reports in its 2017 Electric Vehicle Outlook (http://nnw.fm/WFmt2).
China, the United States and Europe will be the primary drivers, picking up 60 percent of the global EV market in 2040. It’s predicted that fossil fuel demand will be displaced by the growing fleet of electric vehicles, Bloomberg’s report states, estimating that up to 530 million electric vehicles on the road will mean up to 8 million fewer barrels of transportation fuel per day will be needed.
A spike in the market for electric vehicles about two years ago hasn’t slowed in the months since, and sales may even be heading for a bigger boost, according to industry experts. Annual global electric vehicle sales are forecast to hit 24.4 million by 2030 – an increase of more than thirtyfold, according to a study by Bloomberg New Energy Finance (http://nnw.fm/s5iCX).
Plans by governments around the world to phase out the combustion engine mean lithium miners will need to step up production in order to meet demand, the report states. Cutting CO2 emissions will create a surge for vital minerals like lithium used in renewable batteries, leading some to believe that lithium could become “the new oil,” according to Forbes (http://nnw.fm/NgI8Z).
Standard Lithium Advances American Projects in California
The recently acquired Smackover acreage is not the only project that Standard Lithium Ltd. (TSX.V: SLL) (FRA: S5L) (OTCQX: STLHF) is looking to advance. Standard Lithium also has a significant lithium exploration project under way in Southern California’s Mojave Desert. (http://nnw.fm/GgYd7). The Bristol Dry Lake project encompasses an area spanning more than 35,000 acres, including both patented and placer mineral claims and private property. Standard Lithium has forged agreements with two of the established brine producers in this region, to explore and develop the area for potential lithium production. Under the agreements, the company can conduct exploration, brine sampling, extraction, evaporation and process testing.
Geophysical data that was recently acquired indicates the basin is deep and expansive, and historical drill samples have shown lithium contents of more than 100mg/l over the drilled interval. Bristol Dry Lake is an established mining area with world-class infrastructure at the project as well as paved road and rail access and water and electricity.
The aim is for Bristol Lake to become the second lithium producing operation in the U.S. Everything about the project fits nicely into the company’s criteria, Mintak says, pointing out the area has seen almost a century of industrial mineral production from brines. Test results from a new geophysical survey of the 35,000-acre total Bristol Lake site indicate that high concentrations of lithium-bearing brines are present throughout the company’s mineral lease agreement claims.
The company announced on Dec. 11, 2017, that it had installed six new separate evaporation ponds at the property to take advantage of the region’s record-high evaporation rates. The ponds will be used to pre-concentrate brines produced from the project. The pre-concentrated brine will then be shipped to the company’s testing and processing facilities located at three campuses across North America (http://nnw.fm/UTc8y).
Standard Lithium, which has established a world-class Scientific Advisory Council of lithium extraction scientists and process engineers to be in charge of the testing work, has brought an enviable amount of extremely valuable experience in the resource development and processing side of the lithium space. The company’s drive to provide battery-grade lithium materials is buoyed by a belief in the transformative state of the world’s energy marketplace.
“I’ve been working in the lithium sector for the better part of the last decade and the team that’s joined me has been working extensively in the lithium space as well, at the cutting-edge of new lithium processing technologies,” Mintak said in an October 2017 interview (http://nnw.fm/2YIHj). “We’ve been at the forefront of applying new technologies and new processing applications to really look at resources that haven’t been viewed through the right lens.”
Potential Industry Comparables
Another lithium exploration company eager to tap into this energy transition is Liberty One Lithium Corp. (TSX.V: LBY) (OTCQB: LRTTF) (FRANKFURT: L1T), a Canadian mineral exploration company engaged in the acquisition and development of high-grade lithium brine deposits. Company CEO Brad Nichol said plans are under way to examine a short-list of prospective lithium properties in both Latin America and Utah during the first quarter of 2018.
“We have had exploration plans for our Utah property in the works for some time, and our extremely favorable $10MM in working capital provides us the opportunity to advance those efforts as well as broadening our reach in search of undiscovered or undervalued projects in order to deliver on our strategic goals for measured growth,” Nichol said in a December 2017 news release (http://nnw.fm/35lXG). “Our desire to build a global portfolio of lithium holdings is based on our assessment of supply chain trends that we believe requires positive and decisive action as the economics of the lithium market continues to evolve.”
Nemaska Lithium Inc. (TSX: NMX) (OTCQX: NMKEF) (FRANKFURT: N0T) is an exploration-stage lithium mining company invested in evaluating lithium properties and processing spodumene into lithium compounds in Quebec, Canada. The company supplies lithium hydroxide and lithium carbonate to the lithium battery industry used in electric vehicles, cell phones, tablets and other consumer products.
“Our lithium hydroxide compares very favorably to that of our peers in the industry and is well within the acceptable specification limits of cathode producers globally,” Bourassa said in a news release announcing the company produced 2 tons of battery grade lithium hydroxide solution for a customer (http://nnw.fm/qiO0e). “Following discussions with multiple cathode makers, I believe ours is one of the best lithium hydroxide products available today.”
Also headquartered in Canada is eCobalt Solutions (TSX: ECS) (OTCQX: ECSIF), a company engaged in exploring mineral properties. Its primary asset is the Idaho Cobalt Project, which will produce environmentally sound battery-grade cobalt salts. The company recently announced (http://nnw.fm/P02cj) the shipment of 3 tons of a bulk mineralized sample of Idaho Cobalt Project resource slated for pilot level metallurgical testing at the Dundee Sustainable Technologies’ facilities in Quebec, Canada. The testing will further confirm the successful removal of arsenic on a pilot level to less than 1 percent, producing a clean cobalt concentrate, the company states.
Far from Canada and the United States, Sociedad Quimica y Minera S.A. (NYSE: SQM) of Chile is a worldwide producer of lithium, iodine (for X-ray contrast media) and specialty potassium fertilizers (http://nnw.fm/Xe9Ew). The company extracts these materials through its high-quality caliche ore and salt brine deposits. As the world’s largest lithium producer, SQM is committed to the development and sustainability of the lithium industry.
Lithium’s Future
Recent breakthroughs in battery technology are expected to continue to generate interest in lithium and its potential uses (http://nnw.fm/Tgs5b). The huge uptake in demand for electric vehicles and other devices dependent on batteries, like smartphones and laptops, should only accelerate the world’s demand for lithium.
For more information on Standard Lithium, visit Standard Lithium Ltd. (OTCQX: STLHF) (TSX.V: SLL) (FRA: S5L)
For a more in-depth look into Standard Lithium (TSXV: SLL) (FRA: S5L) (OTCQX: STLHF) you can view the full report on Streetsignals.com.
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