Electric vehicles (EVs) were supposed to supercharge demand for metals such as lithium, nickel and cobalt. Yet prices for all three EV battery inputs have fallen to such bombed-out levels that producers are curtailing output and deferring new projects.
This is partly a problem of oversupply. Explosive price rallies in 2021 and 2022 resulted in too much new production capacity being brought online too quickly. But it is also a problem of demand.
Shares in Lithium Americas (TSX: LAC; NYSE: LAC) jumped by 20.2% on Wednesday after it announced anew, US$625-million joint venture agreement with General Motors for its Thacker Pass project in northern Nevada.
Under the deal that the developer calls the largest ever by a U.S. original equipment manufacturer in a lithium project, GM is to acquire a 38% stake in Thacker Pass for US$625 million in cash and letters of credit. The JV deal replaces the US$330 million in second tranche equity investment from GM announced in January 2023, and is in addition to the US$2.3 billion loan from the U.S. Department of Energy (DOE).
Australian lithium stocks are just one deal away from a resurgence as investors face a shrinking pool of miners to invest in after Rio Tinto’s $9.9 billion takeover of Arcadium, according to E&P Financial.
The broker said Rio’s landmark deal, which capitalised on the collapse in lithium prices, could trigger a wave of institutional money into the stocks as investors speculate on the next takeover target. “Rio’s acquisition of Arcadium feels like bottom of the cycle M&A,” wrote E&P analyst Adam Martin in a report to clients.
Rio Tinto’s $6.7 billion buyout of Arcadium will give it a suite of lithium filtration technologies that are poised to revolutionize how the metal is produced for the electronics and electric vehicle industries.
Arcadium’s expertise in so-called direct lithium extraction (DLE) is the real prize for Rio, analysts said, and vaults it into contention with Eramet, Sunresin, Exxon Mobil and others aiming to make the technology commonplace in coming years.
Federal minister says Canada must pick up the pace of critical minerals development, without cutting environmental corners
Canada needs to speed up the pace of mining-related development if it wants to be a critical minerals leader on the global stage. That was the message from federal Energy and Natural Resources Minister Jonathan Wilkinson during an Oct. 9 appearance in Sudbury.
Speaking at the 2024 Conference of Mining Regions and Cities, hosted by the Organisation for Economic Co-operation and Development (OECD), Wilkinson noted Canada’s global ranking in the top five producing countries for 13 major minerals and metals, including palladium, gold, platinum and nickel.
https://www.theglobeandmail.com/
Rio Tinto PLC is buying lithium producer Arcadium Lithium PLC in a big bet on the electric-vehicle battery metal in the midst of a vicious bear market.
The Anglo-Australian major is paying US$5.85 a share for U.S.-based Arcadium, a premium of 90 per cent to Friday’s close, in an all-cash transaction worth US$6.7-billion. The boards of both companies are in favour of the deal. Lithium prices have crashed in recent years owing to China flooding the market and a slowdown in electric-vehicle sales.
https://www.canadianminingjournal.com/
Rio Tinto has made an approach for Arcadium Lithium, the two sides confirmed on Monday, following market speculation over the weekend, and as the sector begins turning its attention back to growth.
The move would position Rio as one of the world’s largest lithium miners, behind only US-based Albemarle and Chile’s. This would happen because the acquisition would hand Rio Tinto lithium mines in Argentina and Australia, as well as processing facilities in the US, China, Japan and the UK.
https://www.northernontariobusiness.com/
Four northwestern Ontario mining proponents snag funding for road, transmission line and engineering work
Four copper and lithium mine developers in northwestern Ontario, collectively, will be pocketing almost $14 million in federal funding to build access roads and power lines into their future mine sites.
Federal Energy and Natural Resources Minister Jonathan Wilkinson delivered the news in Thunder Bay, Oct. 7, that $13.8 million is earmarked for five mining-related projects – including two with Sudbury’s Frontier Lithium – that will facilitate the mining and movement of these critical minerals for processing and eventually to the electric vehicle supply market.
Oliver McPherson-Smith, Ph.D., is the director of the Center for Energy & Environment at the America First Policy Institute.
America’s vast mineral wealth has underwritten our nation’s evolution into an economic and military superpower. From the gold rush that fueled the race westward almost 200 years ago to the iron ore and coal miners that powered the construction of bridges, skyscrapers, rail lines and military vessels, mining has been central to American prosperity.
Sadly, America’s commitment to mining its resources has fallen victim to progressive dogma. Now, Beijing’s vast influence over global mineral supply chains poses an economic threat to the United States. While the Biden-Harris administration is hamstringing American mining projects in red tape, Chinese miners are preemptively flooding the global market to keep American minerals in the ground.
https://www.theglobeandmail.com/
Indonesia already accounts for 55 per cent of the world’s nickel production, and that output is only expected to grow. But locals fear losing precious farmland over a commodity that might soon lose its lustre
Atop a hill overlooking Loeha Raya, a cluster of villages on the shores of Lake Towuti, on the Indonesian island of Sulawesi, all that can be seen is green. For kilometres around, the hills are covered in leafy pepper plants, roughly two metres high, growing in neat rows reminiscent of a vineyard, their tiny fruit slowly ripening and turning red, at which point thousands of workers will harvest them, laying the peppercorns out to dry in the hot Southeast Asian sun.
Down at the lakeside, where lumbering ferries dock from the town of Sorowako, across the water, the idyllic calm of the pepper fields is nowhere to be found, however. Large posters greet arrivals with angry slogans: “Reject mining,” “Save our village” and “Defend agricultural land!”
Rio Tinto is boosting efforts to win public support for its $2.4 billion Jadar lithium project in Serbia, which has been halted since 2022 because of stern opposition due to environmental concerns.
The world’s second largest miner has been pushing since to resume work on the project, expected to be Europe’s biggest mine of the battery metal. With projected production of 58,000 tonnes of refined battery-grade lithium carbonate per year, Jadar could supply enough lithium to power one million electric vehicles and meet 90% of Europe’s current lithium needs.
SINGAPORE, Sept 25 (Reuters) – Mining investment conferences have a great track record of pointing to the next growth area for commodities, as they bring together early stage investors and junior miners seeking to get projects off the ground.
A decade ago lithium was the popular metal, five years ago it was the turn of gold and more recently copper has been the flavour of the month at these events across Asia. But at the 121 Mining and Energy Investment conference this week in Singapore there was no clear choice, and no real consensus on where the best opportunities lie.
A junior resource company’s place in the food chain is to acquire projects, make discoveries and hopefully advance them to the point when a larger mining company takes it over. Discoveries won’t be made if juniors don’t have boots on the ground, if they aren’t out in the bush poking around and breaking rocks.
Few exploration companies have the money or technical expertise to “go mining”. For many, the goal is to find a deposit that’s good enough to attract a major who will acquire the asset. Another pathway is for the junior to partner with a larger company. An option or joint venture (JV) agreement is a way for juniors to gain access to the financial and technical resources needed to build the mine.
Manufacturers and investors should beware the reputational and operational risks of dealing in Indonesian nickel
Earlier this month, the US government sounded the alarm over the use of forced labor in the nickel mines of Indonesia.
The finding has major implications for the energy transition because large amounts of nickel are needed to produce electric vehicle (EV) batteries and other low-carbon energy technologies.
The Department of Labor’s recent forced labor determination could push Jakarta into further dependence on China and Chinese firms.
On September 10, the United States Department of Labor (DOL) added Indonesian nickel to its list of goods produced by child or forced labor. Nickel is a critical mineral with applications in steelmaking, aircraft engines and turbines, and perhaps most prominently in renewable energy and vehicles, where it is one of the key components of nickel-manganese-cobalt (NMC) lithium-ion batteries.
This listing highlights the dominance of Indonesia’s nickel sector by Chinese firms and deals yet another blow to the country’s aspirations to secure a critical minerals-specific free trade agreement (CMS-FTA) with the United States.
